Egypt’s PM, CBE Governor follow up on necessary FX reserves for importing basic commodities

PHOTO

Egypt’s Prime Minister Mostafa Madbouly met with Acting Governor of the Central Bank of Egypt (CBE) Hassan Abdalla on Sunday to follow up on the country’s foreign currency reserves and what is needed to procure basic commodities and production requirements.

The meeting comes within the framework of coordination between the government and the CBE to ensure the availability of sufficient stocks of basic commodities, the Cabinet said in a Sunday press statement.

Nader Saad — Official Cabinet Spokesperson — said that the meeting also stressed how increasing foreign exchange reserves is a top priority for both the government and the CBE.

Recently, the CBE undertook a package of bold decisions, on top of which was the complete liberalisation of the EGP and the adoption of a flexible exchange rate, raising interest rates by 2% at once and announcing the start of work on building a market for financial derivatives.

The CBE also promised the business community that it would gradually cancel the instructions issued on 13 November regarding using documentary credits in import operations.

Accordingly, these measures will be completely repealed by December and this measure will serve as an incentive to support economic activity in the medium term.

Saad added that in this context, work is underway to intensify joint efforts to develop USD resources by attracting more foreign direct investments.

Additionally, the government is also working on boosting the tourism sector and aims to increase USD sources through an initiative to facilitate customs procedures for Egyptian expat’s cars.

In October, the International Monetary Fund’s (IMF) staff and the Egyptian authorities reached a staff-level agreement on comprehensive economic policies and reforms to be supported by a 46-month Extended Fund Facility (EFF) Arrangement of $3bn.

The new EFF aims to safeguard macroeconomic stability and debt sustainability, improve Egypt’s resilience to external shocks, strengthen the social safety net, and step-up reforms that underpin higher private-sector-led growth and job creation.