People, Travel

Egypt Posts Massive Losses

Egypt Posts Massive LossesEgypt Posts Massive Losses

Egypt’s tourism revenue has declined by roughly $1.3 billion since a Russian plane was allegedly brought down by terrorists in the Sinai last year, Prime Minister Sherif Ismail said in a televised interview on Monday.

Egypt’s President Abdel Fatteh el-Sisi said last week that a Russian plane that crashed in Sinai last October, killing all 224 people on board, had been downed by terrorists seeking to damage its tourism industry and ties with Russia, echoing a position already taken by western countries and Moscow, Reuters reported.

“After the plane crash, over the past three or four months, we lost around $1.2 billion to $1.3 billion in revenues,” Ismail said.

Last week, Egypt announced that it would cut its economic growth forecast for the current fiscal year due to its battered tourism.

The revision to a range of 4% to 4.25% from a previous estimate of 5% underlines the challenges Egypt has faced trying to rally an economy that has struggled since the 2011 uprising that toppled the former dictator Hosni Mubarak.

Egypt has largely relied on Persian Gulf Arab allies that have pumped tens of billions of dollars in aid, grants and investments since the ouster of president Mohammed Mursi in July 2013, Bloomberg reported.

The negative impact of the Metrojet passenger plane crash in October near the Red Sea resort of Sharm El-Sheikh has been amplified by a foreign currency crunch that has crippled some companies.

The crash “has had an impact on tourism,” Egyptian Finance Minister Hany Kadry Dimian said last week. “Tourism is one of the major sectors, not just as a driver of growth and one of the biggest sources of current-account receipts but because it has a higher multiplier impact on other industries,” he said.