Data Insight 📊 : "Among emerging markets, Egypt's rank in terms of country risk premium (CRP)"

According to the Stern NYU database as of January 5, 2023, Egypt was ranked fourth among emerging countries - after Argentina, Russia and Turkey - with the highest country risk premiums, with a rate of 9.49%. This indicates that investors demand a return of 9.49% above and beyond the risk-free rate of return and equity risk premium to invest in Egypt.

Such a high-country risk premium can be attributed to several factors, including political instability, economic uncertainty, and other risks that may impact the investment's return. Investors will carefully evaluate these factors before making investment decisions in Egypt or other countries with similarly high-country risk premiums.

According to 2021 statistics, across MENA countries, households in Egypt spent the largest portion of their income only to afford buying food, the food expenditure as a percentage of total consumption was about 38% (more than Iraq and Lebanon).

It indicates that individuals in Egypt bear a greater financial burden and lack of resources to cover other expenses such as housing, transportation and health care, as well as they are more affected by core inflation and higher commodity prices.

Data obtained from ourworldindata.org