The overall balance has not entirely lived up to the promise of its parts, however. The $7,523 million trade deficit, although only marginally worse than the same period in 2002/03, continues to weigh heavily on the government’s accounts. The flotation of the local currency in January last year heralded a marked improvement in the competitiveness of exporters, while exports have also been bolstered by the ongoing development of the local gas sector. However, the import bill continues to mount, reaching $17,975 million by the end of June this year, up from $14,820 million in 2002/03.

The signs of recovery in the current account have yet to filter through to the capital account, which continues to deteriorate. Direct investment in Egypt has slowed to a trickle, while the net investment deficit has widened by 104 per cent year-on-year to reach $6,076 million, contributing to an overall deficit in the balance of payments (BoP) of $158 million. The government can only trust in the saying that it is usually darkest before the dawn.