المستخلص: |
The rise of excessive external imbalances has been at the heart of academic research as well as policymaking decisions in Egypt especially after Egyptian Revolution in 2011, in order to determine the main tools that may help in decreasing external deficit. So, This research Target to determine the impact of exchange rate on external economic equilibrium (especially current account of balance of payment) which will affect overall balance of payment and international reserves in the Egyptian economy. First by listing the theories of external economic balance, and then analyze the evolution of both the exchange rate and the current account balance of payments in Egypt from 1977 to 2017, and analysis the relationship between them throughout the time period. The research found that the Egyptian economy exchange rate (devaluation of the local currency) has led to improve of current account balance in most years except the period after the revolution- as a result of the political turmoil that we have seen which led to the disruption of economic conditions-will lead to improvement of overall balance of payment and increasing in international reserves. In the beginning of November 2016 and start Egypt second economic reform program with the IMF, which included several stipulations including deregulation of exchange rate, we find that this has led to a decrease in the current account balance deficit by about 61% in 2017 from what it was in 2016 and led to an increase in international reserves and improved the reserve index in terms of imports months from 3.6 in 2016 to 5.7 in 2017, which is consistent with the theory in most years of the study
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