Egypt - Civil Aerospace: Passenger and trade volumes driving growth (Strategy, Performance and Risk Analysis)
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In Egypt, the civil aviation ministry is in charge of all the matters pertaining to civil aviation. The government announced the launch of the airport city initiative, under which an airport will be built in Cairo. Egypt's nominal GDP declined by at an annual growth rate of -15.6%, from US$315 billion in 2015 to US$266 billion in 2016 due to currency devaluation and a fall in fuel prices. Despite its proximity to the European market, Egypt lags behind Saudi Arabia in terms of economic growth and performance.
Rising disposable income to drive traffic
In Egypt, passenger volume recorded a rate of 11.7%, from 11.1 million in 2015 to 12.4 million in 2016 and is expected to post a CAGR of 5.9%, from 13.1 million in 2017 to 16.5 million in 2021. Growth will primarily be attributed to an increase in the volume of international and domestic tourists due to graeter levels of disposable income.
Decline in capital expenditure on single-aisle aircraft to decline
Capital expenditure on aircraft rose from US$160 million in 2015 to US$372.4 million in 2016. However, due to a decline in capital expenditure on single-aisle aircraft, expenditure is expected to decline at a CAGR of -3.9%, from US$385 million in 2017 to US$325 million in 2021.
Deliveries to increase over the forecast period
The total number of deliveries rose from one in 2015 to two in 2016. Deliveries will post a CAGR of 18.9%, from two deliveries in 2017 to four in 2021. Growth will be supported by the procurement of wide-bodied aircraft due to an increased in passenger demand.
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