CAIRO: Egypt's Suez Canal posted a single day revenue of LE 117 million ($19.4 million) on Wednesday, according to head of the canal authority. These were the highest recorded revenues since the authority increased toll fees by 3 percent this year, after keeping them the same for three years. About 61 vessels from various countries had access to the waterway on Wednesday transporting a record 3.5 million tons of goods, Ahmed Ali Fadel, head of the Suez Canal Authority said in a report the official MENA news agency. Despite arguments that the hike in toll fees might discourage ships from using the causeway, revenues have proven otherwise. Along with remittances coming into the country from Egyptians working abroad, the Suez Canal is a vital source of revenue and foreign currency for the country, despite the economic turmoil of the past year. However, while "there is money coming in, we still do not have adequate revenues to plug up the deficit," said Magda Kandil, executive director of the Egyptian Center for Economic Studies (ECES). Egypt's finance minister denied earlier this week reports that the government had raised its budget deficit forecast for this fiscal year to LE 150 billion. The size of the deficit was not expected to exceed LE 144 billion ($24 billion), he said. Last fiscal year, Egypt reported about $12 billion worth of remittances, and according to Kandil, this amount remains "viable." Although the rise in oil prices and the growth of the Canal revenues have helped Egypt over the past months, the country still needs to focus on the plummeting tourism numbers and foreign direct investments which have almost stagnated over the past year. Foreign reserves are currently at $15.7 billion, which are expected to last through only three months worth of imports. "There have been some improvements on the account of the rise in oil prices, remittances, and Suez Canal revenues, but all of this is not fitting into the bigger picture," Kandil added. For the past year, the ruling Supreme Council of the Armed Forces has blamed the ongoing economic turmoil on the continuing protests, which have mostly called for a quicker transition to democracy. On the other hand, analysts and economists have blamed the prolonged and mismanaged transition process. Kandil said this excuse from the government has become a burnt card. "I don't think you can blame the revolution anymore at the stage we are in," she underlined. "Only in the first quarter of 2011 was this valid, but we have had ample time to put in policies that could stabilize the economy." With the weakening sentiment of recovery, Kandil pointed out that the country has also seen a surge in "hot" money flowing out of the country by Egyptians and local investors. Recent reform measures taken by the government to get the deficit under control had succeeded, according to a statement on the finance ministry's website, and the government is closely watching government expenditures as well as working to find new sources of revenue, including better collection of taxes. Egypt is also seeking a $3.2 billion dollar loan from the International Monetary Fund, which is expected to visit Cairo next week.
