...Evaluate Efficient Market Hypothesis in Egypt in light of your studying of the hypothesis in class? Ref: www.egx.com.eg/pdf/the_performance_of_egyptian_stock_ The Performance of the Egyptian Stock Market Emerging markets are generally characterised by being “informationally inefficient”, which might indicate the existence of mispricing opportunities that justify the activities of active fund management to achieve abnormal returns within these markets. The aims of this project were, first, to explore the effect of information on the performance of the stock market in Egypt in accordance with the Efficient Market Hypothesis, as suggested by Fama (1970) and others, and, then, to assess whether mutual funds in Egypt were able to adopt strategies that outperformed a passive strategy. To achieve these objectives, first, Event Studies were utilised to examine the behaviour of stock returns around the announcement date of a number of corporate actions including dividend distributions and acquisitions during the period 2000/2001. Then, CAPM based Performance Evaluation measures were utilised to assess the performance of a sample of mutual funds in the Egyptian market during the period from the beginning of 1998 until the end of 2001. The tests for market efficiency showed a departure from the “Semi-Strong from” efficient markets indicating that publicly available information might have not been “fully reflected” in securities prices and suggesting the existence of mispricing opportunities...
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...THE GROWTH EFFECTS OF FINANCIAL LIBERALISATION PROGRAMME IN EGYPT: DEVELOPMENTS AND DRAWBACKS (Key Words: financial liberalisation, economic growth, Egypt) DR. Ayman M. Ebrahim Faculty of Commerce and Business Administration Helwan University Ein Helwan , Cairo E-mail: ahendy@ksu.edu.sa hendyayman@hotmail.com ABSTRACT The paper begins with a review of theory and recent empirical evidence relating to financial liberalisation and economic development. Among the countries that underwent financial liberalisation programmes in the 1990s, Egypt appears to have performed well. Although the internal and external shock to the economy and the associated drawbacks in the financial liberalisation programme, over the past decade, which brought the experience of financial liberalisation, the Egyptian economic performance improved. Its aggregate growth rate was positive and macroeconomic variables moved in a favourable direction in accordance with the predictions of the financial liberalisation paradigm. The econometric test specification follows the nonlinear least-squares estimations methodology to test the co-movement of the underlying variables. INTRODUCTION The financial liberalisation paradigm encourages nominal interest rate liberalisation, the reduction or abolition of reserve requirements, the elimination of inflationary finance, the removal of other forms of taxation on...
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...MONETARY POLICY- EGYPT Ankita PGDM-IB(Ist Year ) MONETARY POLICY Monetary policy is the process by which the monetary authority of a country controls the supply of money, often targeting a rate of interest for the purpose of promoting economic growth and stability. The official goals usually include relatively stable prices and low unemployment. Monetary theory provides insight into how to craft optimal monetary policy. It is referred to as either being expansionary or contractionary, where an expansionary policy increases the total supply of money in the economy more rapidly than usual, and contractionary policy expands the money supply more slowly than usual or even shrinks it. Expansionary policy is traditionally used to try to combat unemployment in a recession by lowering interest rates in the hope that easy credit will entice businesses into expanding. Contractionary policy is intended to slow inflation in hopes of avoiding the resulting distortions and deterioration of asset values. Monetary policy differs from fiscal policy, which refers to taxation, government spending, and associated borrowing. MONETARY POLICY-EGYPT What is the CBE’s Monetary Policy Objective? Law No. 88 of 2003 of the "Central Bank, Banking Sector and Monetary System" entrusts the Central Bank of Egypt (CBE) with the formulation and implementation of monetary policy, with price stability being the primary and overriding objective. The CBE is committed to achieving, over the medium...
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...Interest rates are considered to be the price of holding money and the opportunity cost of any investment. After analyzing interest rates in our course do you think that interest rate in Egypt reflects the real opportunity cost of holding money? Why or why not? Please support your answer with all the references you have searched. Interest Rate is: The amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets. Interest is charged by lenders as compensation for the loss of the asset's use. In the case of lending money, the lender could have invested the funds instead of lending them out. That’s why interest rate should cover the opportunity cost of lending the money to the borrower. Also, interest rate should cover the inflation rate in the economy, as by time the lender receives the principal again due to inflation, the money will be of less value than when first lent to the borrower. So, if the interest rate doesn’t cover both the opportunity cost and inflation, it’ll be irrational decision to lend the money. For example, if the lender can invest in some real estate and construction projects with an average return of 10% & if inflation is 10%, then the interest rate should be more than 20% to be rational choice for the lender to lend the money. Interest rate in Egypt: (Lending Interest Rate) So, The lending interest rate is now at 9.75% annually, so, does this rate covers the inflation rate & opportunity cost of investing...
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...The Index The Index | 1 | The Introduction | 2 | Financial Subprime Mortgage Crisis Causes | 3 | Introduction & Background to the Situation of the Egyptian Economy prior to the Global Financial crisis | 10 | Financial Subprime Mortgage Crisis Impacts on Egypt | 13 | The Egyptian Economy & the crisis | 21 | The Conclusion & Solutions | 23 | The References | 27 | The Introduction In the second half of 2008, the world economy went through a serious financial upheaval that sparked off in the United States and spread to Europe and the rest of the world. The negative consequences of this financial crisis had bitten the Egyptian economy in many fields. Egypt’s growth rate witnessed setbacks and may have posted its slowest annual growth in half a decade in 2008–2009 as the global crisis hit revenue from tourism, migrant labor remittances, the Suez Canal, export revenues, and investment. The severity of the crisis and its uncertainties demonstrated the need for urgent action to restore financial stability, lead the economic recovery and secure a sustainable future for the country. This paper therefore critically discusses the current global financial crisis and its impact on Egypt. It presents an overview of the Egyptian economy prior to the crisis, followed by an assessment of the depth and impact of the crisis on sectors of the Egyptian economy. Additionally, the paper highlights the actions taken by the Egyptian government to weather the effects...
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...Monetary policy in Egypt introduction Considers monetary policy a form of stabilization policies to produce state-of-order to fight economic imbalances various Therefore, monetary policy requires a degree from coordination with other policies and there reduces the effectiveness of monetary policy in cases of depression and the imbalance between demand and supply of goods and services, what is said about monetary policy does not stand in front of the effectiveness of pilgrimage Monetary policy is the process by which monetary authority of a country controls the supply of money, often targeting a rate of interest for the purpose of promoting economic growth and stability. The official goals usually include relatively stable prices and low unemployment. Monetary policy differs from fiscal policy, which refers to taxation, government spending, and associated borrowin Monetary policy is referred to expansionary or contractionary, expansionary policy increases the total supply of money in the economy more rapidly than usual contractionary policy expands the money supply more slowly than usual. Monetary policy types 1. The inflation target The inflation target is achieved through periodic adjustments to the Central Bank interest rate target. The interest rate used is generally the overnight rate at which banks lend to each other overnight for cash flow purposes. Depending on the country...
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...product today through their long history. Various distribution systems are utilized, including multiple-line exclusive agents, independent agents, third-party marketing organizations, career agents, and direct sales to the public. As of September 2011, American National Insurance Company’s (Nasdaq: ANAT) total revenue was $3.04 billion. RISK FACTORS American National, being a leading insurance company, is also exposed to the numerous risks that might affect their operations and eventually lead to major losses. Described below are the risks and exposures that I have identified as being the most significant to this company: * economic trends * catastrophic events * risk of litigation and regulatory investigations * interest rate changes * a downgrade in financial strength ratings Economic...
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...Doing Business Project, Egypt’s ranking in the ease of doing business had risen to 106 out of 183 countries, up from its 2008 ranking of 116, making it a World Bank “top ten reformer.” In addition, Egypt had made substantial progress in opening up its economy to global trade, with its rank in the Global Competitiveness Report 2009-2010, published by the World Economic Forum, moving up by 11 positions to 70 out of 133 countries. Despite its rise in the rankings, Egypt still has a relatively low level of openness, with exports/GDP at 25%. (Deutsche Bank, 9 Feb. 2010) As a result of its low level of integration with world markets, Egypt was not hit by the global recession to the extent that more “linked” economies were. However, this also means it is less likely to benefit from the recovery in global trade. Prior to the global recession, Egypt had hit its 7% official GDP growth target for 2 years in a row, with 2007 and 2008 growth at 7.1% and 7.2% respectively. This rate of growth had enabled it to reduce unemployment from 10.9% in 2005-06 to 8.1% in 2007-08. In 2008-09, however, unemployment rose to 8.8% and GDP growth slowed to 4.7%. (Figure 1) Although these numbers are not so bad compared to many Western countries, it could still potentially present some big issues for Egypt down the road because it is a country with a very young population. According to the World Bank, 32% of its population is between ages 0 and 14, 63% is between ages 15 and 64, and only 5% is...
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...Term Project: Currency Analysis Egypt International Finance The currency of Egypt is the Egyptian pound (EGP) and over the last 10 years its value against the US dollar has changed but not as much as people may have thought it to. In order to understand how and why the currency has changed over the past 10 years, we have to look at a number of factors that impact a country’s currency. The things that impact a country’s currency include economic factors such as the strengths and weaknesses and imports and exports, a country’s current financial status including the market and banking system, the exchange rate system, the country’s reserve and also the role and action of the central bank. The last factor that can help to predict a country’s future is the government; this includes GDP, taxes, and legislative changes. As stated above, over the last 10 years the EGP has undergone some fluctuation. As of December 10, 2002, the value of the EGP when compared to the US dollar was .21563. As of today when the EGP is compared to the US dollar the value is now .16385 (XE, 2012). However, the value was only up at .21563 for a brief period of time, it dropped sharply at the end of January from close to .22 by almost 3 points and continued to fall until the end of 2004 bottoming out at a low of .15852. Over the course of the next 4 years, the value of the EGP steadily grew until it topped out close to .19 in early August of 2008. Unfortunately, the value of the EGP...
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...Ahmed N. Kassem Block 45 El-Narges District ,5th settlement , New Cairo Tel:+222741013 Mobile: +201020444563 E-mail: ahmednabil51@gmail.com PERSONAL INFORMATION: Date of Birth : 01/06/1988. Gender : Male Marital Status : Single Nationality : Egyptian. Military Service: Exempted Undergoing studies: SCMG ”Supply Chain Management Diploma” ; The American University In Cairo Qualification: o B.Sc., Faculty of Commerce; June 2010. Kafr El Shekh University; Faculty of commerce English accounting department. Language: o English language: Fluent; not mother tongue. AUC, general English level 11 Current job: From March 2014 till now AL KHARAFI GROUP – EMAK FOR COMPUTER MANUFACTURING PROCUREMENT OPERATIONS EXECUTIVE Scope Of Work: • Interfaces with Product Line Planning Manager to plan and prioritize purchasing activities. • Reviews planned orders, creates requisitions for purchased items, and manages approval process. • Transmits and prioritizes approved purchase orders and supporting documents to supplier. • Tracks order acknowledgement, prepares and communicates shortage and backlog reports, and provides visibility of potential interruptions to internal customers. • Tracks orders and confirms system lead times, delivery dates, and costs. • Reviews, updates, and maintains purchase orders until they are...
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...Cairo University Faculty of Economics & Political Science Post graduate studies Economic Department Finance for Growth and Role of SMEs An Application to Egyptian Case Prepared by: 1- Amr Hassan Elkady 2- Nashwa Mohamed Hussein Presented to: Prof. Hala El-Saied 2010 In September 2004, the Financial Sector Reform Program was launched and endorsed by the Government of Egypt at the highest political level. The five pillars of the program are reforming the banking sector, restructuring the insurance sector, deepening the capital markets, developing a well functioning mortgage market, and activating other non-bank financial institutions and services. The program aims at improving the soundness of the financial sector and promoting an enabling environment for an efficient, competitive and agile financial system that serves Egypt’s development and growth objectives. The progress and pace of the Egyptian Financial Sector Reform Program have been commended at home and abroad. However, we still have some way to go to fully reform the sector and address its main challenges; one of which is ensuring better access to financial services which is imperative to economic growth and development. Improving access to finance allows businesses, especially small and medium...
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...since 1990s. The underlying reasons for such international flows of capital can be attributed to several factors. International investment, for example, allows capital to find the highest rate of return, helps the owner of capital to diversify his or her lending and therefore reduces the associated risk, contributes to further development and spread of best practices in corporate governance and accounting rules, and finally it prevents the government from pursuing poor policies. The aforementioned advantages of the free flow of capital across national borders can be realized through two primary kinds of international investment: (1) Foreign Portfolio Investment (FPI) and (2) Foreign Direct Investment (FDI). While FPI is defined as investment in a portfolio of foreign securities such as stocks and bonds, it does not entail the active management of foreign assets. In other words, FPI is “foreign indirect investment” in that it represents passive holdings of foreign securities not least because the investor does not have control over the securities’ issuer. Exchange rates, interest rates, and tax rates on interest or dividends are factors that directly impact on FPI. In contrast, foreign direct investment, commonly known as FDI, refers to an investment made to acquire lasting or long-term interest in enterprises operating outside of the economy of the investor. The investment is direct because the investor, which could be a foreign person, company or group of entities, is seeking...
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...CENTRAL BANK OF EGYPT ECONOMIC REVIEW Vol. 51 No. 1 2010/2011 Research, Development and Publishing Sector The Economic Review is issued by the Research, Development and Publishing Sector at the Central Bank of Egypt (CBE) on a quarterly basis. It aims to make available to a broad readership of specialists and nonspecialists a wide range of information on the performance of the Egyptian economy during the reporting period. The CBE posts the Review on its website: www.cbe.org.eg. Contents Page Main Monetary and Financial Indicators The Leading Article - Output Gap and Its Determinants: The Experience of Egypt ………………………………………… 1- Macroeconomic Performance 1/1 1/2 1/3 1/4 Gross Domestic Product (GDP)……………………………... Employment and Unemployment……………………………. Inflation……………………………………………………… Tourism………………………………………………………. 21 27 28 33 1 2- Monetary and Banking Developments 2/1 2/1/12/1/22/1/32/1/42/1/52/2 2/2/12/2/22/2/32/2/42/2/52/2/6Monetary and Banking Policy and Monetary Aggregates…… Monetary Policy……………………………………………... Reserve Money (M0)………………………………………… Domestic Liquidity (M2) and Counterpart Assets…………... Payment Systems and Information Technology (IT)………... RTGS and SWIFT Local Services…………………………… Banking and Credit Developments…………………………... Banking Reform……………………………………………... Supervision Sector…………………………………………… Overview of Banks' Aggregate Financial Position………….. Interbank Transactions in Egypt……………………………... Deposits……………………………………………………… Lending Activity……………………………………………...
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...•Consumer •Business Recommendations Prepared By Ahmed Farouk Mohamed Ahmed Abdel Aty Saadeya Nour Adham Adel Osama Abdel Razek Amr Ibrahim Historical background of the company Etisalat is a leading international telecom company operating in 18 countries around the world. Egypt is one of the countries where operation was launched in May 2007 as the first 3.5G operator. Etisalat’s entry to the Egyptian market ushered in a new era for the telecom industry. Etisalat Misr introduced for the first time to the market a host of 3.5G services, such as video calling, mobile TV, mobile broadband internet and data services. In a bolder step, 3.75G was introduced and assumed absolute market leadership in providing the fastest broadband internet in the market through USB modems and 3G mobile handsets. Etisalat’s entry brought to the market an array of competitive and innovative rate plans that attracted one million subscribers in the first 50 days of operation. Thanks to the entry of Etisalat to the market, mobile users in Egypt now have wider options, higher service quality, more innovative services and better value for money. Mobile Telecommunication Market Players Vodafone Mobinil Telecom Egypt : Initiated...
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...BUSINESS AS USUAL? RECENT CHANGES IN THE ARAB WORLD IN HISTORICAL CONTEXT" By Michael B. Bishku* INTRODUCTION What began in Tunisia in December 2010 and continues most violently in Syria today has been labeled by observers of and experts on the Middle East as the "Arab Spring," but is that the correct term? (It should be noted that Lebanon engaged in the Cedar Revolution in 2005 - following the assassination of Sunni Prime Minister Rafiq Hariri by Hezbollah operativeswhich resulted in the withdrawal of Syrian froops after 30 years.) While Tunisia seems to be emulating Turkey as a historically secular country with mildly Islamist politicians exercising the greatest amount of influence in their country's respective foreign and domestic affairs, Egypt, the birthplace of the Muslim Brotherhood, appears to be at the center of a struggle between the Islamists and the military, which has dominated politics in that country since the early 1950s, while secularists and the minority Copts feel as if they have been sidelined. Majority Shi'a in Bahrain were quashed in their attempt to have a minority Sunni government recognize their rights, while Yemen's longtime leader was replaced by that country's vice president. Libya toppled an erratic dictator, but has no experience with representative government and like in Yemen the population possesses tribal identities. Syria is now engaged in a brutal civil war in which at least 20,000 people have lost their lives by the summer of 2012. Other countries...
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