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**Box 4**

# **Egypt's Largest Three-Digit Regional Exports: 1970-72, 1980-82 and 1990-92**

What is Egypt exporting to the region and how has the product composition of this exchange been changing. The following tabulations show that crude petroleum accounts for over 50 percent of Egypt's intra-regional exports -- up from approximately 2 percent in the early 1970s (the share of petroleum may be even higher given the Egyptian practice of not including foreign company exports in official trade data). Approximately 97 percen; of the petroleum exports go to Israel, with small amounts destined for Turkey and the UAE. Foodstuffs play an important role in Egypt's intra-regional trade as these products comprise four of Egypt's eight largest three-digit exports. In 1992, 55 percent of Egypt's total intra-regional food exports went to Saudi Arabia, 12 percent to Libya and 15 percent to Syria and Lebanon combined.

||Valu|e of Exports|($000)|Percent|of Total Ex|ports (%)|
|---|---|---|---|---|---|---|
|Description (SITC)|1970-72|1980-82|1990-92|1970-72|1980-82|1990-92|
|Crude Petroleum (331)|705|395,830|268,777|1.9|78.7|53.5|
|Fresh Vegetables (054)|1,611|16.518|36,282|4.4|3.3|7.2|
|Rice (042)|7,778|5,048|24,864|21.2|1.0|4.9|
|Textile Yarn (651)|2,487|1,146|19,061|6.8|0.2|3.8|
|Fresh Fruit and Nuts (051)|774|16,051|14,581|2.1|3.2|2.9|
|Aluminum (684)|0|7,012|14,401|0.0|1.4|2.9|
|Live Animals (001)|1,550|21,155|14,259|4.2|4.0|2.8|
|Nonfur Clothing (841)|323|677|13,837|0.9|0.1|2.8|
|Medicinal Products (541)|721|4,443|11,140|2.0|0.9|2.2|
|Iron and Steel Shapes (673)|27|121|9,957|0.1|-|2.0|
|Cotton Fabrics (652)|3,373|4,443|9,643|9.2|0.9|1.9|
|Chemicals nes (599)|5|70|6,877|||1.4|
|Footwear (821)|10|256|6,208||0.1|1.2|
|Natural Gas (341)|4|0|5,970||0.0|1.2|
|Petroleum Products (332)|325|0|5,100|0.9|0.0|1.0|
|Furniture (821)|288|649|5,046|0.8|0.1|1.0|
|Cereal Preparations (048)|84|113|4,796|0.2||1.0|
|Base Metal Household Equipment (697)|67|142|4,583|0.2||0.9|
|Glassware (665)|11|1|4,576|||0.9|
|Metal Manufactures (698)|151|121|4,520|0.4||0.9|

Several of the products listed above (textile yarn, nonfur clothing, cotton fabrics and footwear) are normally manufactured by labor intensive production processes so their appearance is something of a surprise. The direction of this exchange conforms to what would be predicted by factor proportions theory as over 50 percent of the shipments of these products go to Saudi Arabia and Libya -- both relatively high income and high wage cost countries.

In terms of total intra-regional exports Israel is curr ntly the largest single destination receiving 41 percent of Egypt's exports, followed by Saudi Arabia (28 percent) and Syria (5 percent). I'hese shares, however, are highly affected by oil exports. When petroleum is excluded Saudi Arabia is the largest destination receiving 48 percent of Egypt's exports followed by Libya with 14 percent. In contrast, Israel only receives under 3 percent on non-energy goods exported by Egypt.

In 1990 Egyptian exports to Iraq were only $31 million so the gulf war has not had a major impact on the structure of intra-regional exports. Four two-digit SITC products: plastics (SITC 58); iron and steel (SITC 67); metal manufactures (SITC 69); and plumbing equipment (SITC 81) accounted for over two-thirds of Egypt's exports to Iraq.