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Economic situation of Egypt

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  1. The internal analysis of Michelin
    1. The ethics of Michelin.
    2. Competitive financial, technical and commercial aspects
    3. Segmentation
    4. Portfolio of products and 4Ps of Michelin
    5. Strengths / Weaknesses of Michelin
  2. The external analysis of Michelin
    1. Microenvironment: Michelin's partners
    2. Market opportunities and threats by the PESTEL method
    3. Competitive analysis and Porter's five forces
  3. SWOT analysis
  4. Strategic decisions undertaken by Michelin on SBA
    1. Passenger Vehicles
    2. Heavy Load
    3. Specialty tires
    4. Other group activities

The Egyptian pound is the official currency of Egypt, although a large number of currencies including the US dollar, the pound sterling and the euro were in circulation in the territory. A large share of the economic activity of the country is linked to international tourism. Egypt's relations with other developing economies are based primarily on Africa, Asia and the Middle East. While in the past their exports were only of antiques (relics, statues, mummies etc), now they have turned to gas, agriculture (with fruits and vegetables), ore (granite, iron), oil, textiles and handicrafts. In the field of electricity production, this is clearly not sufficient.

In 1945, every Egyptian had ten times less electricity than every Frenchman, and twenty times less than every Englishman. In addition, much was absorbed by industry, irrigation and drainage. Only the cities were almost electrified in 1950, with 50 towns and villages. Consumption in Egypt was recently limited by low purchasing power of a portion of the population before the war. Two thirds of the inhabitants of Cairo consumed absolutely no electricity, except by the tramway and street lighting. It is noteworthy that Cairo produces and consumes about half the national total. To remedy this situation which is not conducive to the development, a diversion canal and hydroelectric plant were constructed in Aswan.

But it seems that the production of this set is huge dedicated to meet themost severe disabilities: The electrification of the other dams downstream have the advantage of producing a less variable, but, unfortunately, it is much lower.The problem of electrification of the dam will always have to face the focus on the needs of irrigation. Thus, the industry is subject to the requirements of agriculture. Thermal plants are therefore likely to continue and remain essentially thermal power plants. The war has only brought the replacement of coal by oil and gas, whose sources of production are nearest and at the lowest cost.

As one has seen previously, Egypt lacks everything, hence the huge rate of import. Because of its production it can not ensure its energy, raw materials, food and basic necessities such as even soap. It may seem paradoxical that Egypt exports products that it imports, but this is explained by the theory of David Ricardo's comparative advantages. It stipulates that all countries, even less competitive, have an interest to return to the game of international trade by specializing in the production where they have comparative advantage and the largest relative disadvantage with the least serious consequences. In reaching this conclusion, David Ricardo makes four assumptions: the value of labor is equal to the price multiplied by the amount of work, competition must be perfect, there must be immobility of factors of production at international level (only goods moving ) and finally the productivity should be constant.

To refine some of the growth indications, one can study the per capita GDP in PPP (Purchasing Power Parity). This indicator, although complex, is one of the most appropriate to compare saving them.
The correction of the PPP (purchasing power parity) takes into account differences in purchasing power between different currencies, and since it also takes into account the population, it allows for more wealth of a country.

Tags: Egypt; economic situation; import and export; purchasing power parity (PPP)

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