Global shipping continues to suffer from the glut of vessels ordered during the pre-downturn boom years, BMI said in "Egypt Freight Transport Report Q3 2011". With demand still struggling to hit pre-recession levels, the three shipping sectors – container, dry and liquid bulk – are all struggling to maintain healthy rates in the face of overcapacity in the global fleet. Indexes are falling and ships are increasingly being forced to operate below break even rates. Huge geopolitical black swan events - the Arab spring and the Japanese disaster - have further complicated the market dynamics in the shipping sector. Egypt has felt the full brunt of the first of these events, as the second Middle Eastern country, after Tunisia, to depose its long-standing president. The turmoil leading up to – and following - this event disrupted shipping in the country hugely. February throughput figures are yet to be released, but BMI expects levels at the country's ports to have fallen. In terms of airfreight, the Middle East is the fastest growing region in the world according to IATA data, which provides a boon to Egypt's airfreight sector, although its road-haulage industry continues to be hindered by industrial disputes. According to the Egyptian Trade Minister Samiha Fawzi Ibrahim, there was a 6 percent year-on-year (y-o-y) fall in Egyptian exports in January, which was attributed to the curfew and strikes. The net effect of these same factors on February's exports will surely be even greater, and there must have been a fall in throughput at Egypt's ports. East Port Said's throughput was 240,890 in January 2011, up 7.12 percent on January 2010's 224,858. However, the February throughput figures may yet show a decline. Meanwhile, Egypt's central bank left its key overnight deposit and lending rates unchanged, a step expected by analysts in an economy locked in recession for the last six months. The bank's Monetary Policy Committee (MPC) kept its key lending rate unchanged at 9.75 percent and the deposit rate at 8.25 percent after its regular meeting Thursday, it said on its website. Central Bank of Egypt Governor Dr. Farouk El-Okdah has said the total foreign investments that were withdrawn from the Egyptian bond and treasury bills market during the period from January 20 to March 31, amounted to $7.5 billion. He said, in remarks to Egyptian press recently, that this amount is not huge and easily can be recovered in case of resumption of normal economic activity. Investors and tourists retreated from Egypt after the uprising that led president Hosni Mubarak to resign in February. Growth is projected to remain weak in the second half of the year. Urban consumer price inflation edged down to 11.8 percent in the year to end-June from 11.87 percent in May. Core inflation, which strips out subsidized goods and volatile items including fruit and vegetables, rose to an annual 8.94 percent from 8.81 percent in May.
