CBE approves tourism ministry request for currency exchange with Russia: Official

Abdel Razek Al-Shuwekhi
4 Min Read
Central Bank of Egypt
The Central Bank of Egypt (CBE) will approve the Ministry of Tourism’s request for a currency exchange system with Russian companies
(DNE Photo)

The Central Bank of Egypt (CBE) will approve the Ministry of Tourism’s request for a currency exchange system with Russian companies, according to a Tourism Ministry official.

The approval will be given in tandem with the Ministries of Industry, Foreign Affairs, and Supply and Internal Trade.

Egypt has been facing a reduction in Russian tourism following the rouble’s devaluation against the US dollar, after the Crimea crisis and the EU economic sanctions against Russia.

The number of Russian tourists to Egypt increased by 600,000 visitors during 2014, to reach 3 million tourists, compared to 2.4 million in 2013.

Tourism income reached $7.5bn last year, with a growth of $1.6bn compared to the previous year.

The ministry targets a 20% growth in the number of tourists to reach 12 million by the end of this year compared to 10 million tourists during 2014.

The official said that “under the difficult circumstances of the Egyptian pound exchange rate against the US dollar, and the reduction’s impact on the travel movement, we have to make our transactions using the Russian rouble”.

The dollar’s exchange rate increased during the last two weeks to reach EGP 7.63.

Foreign tourism companies in Egypt lost 50% of their sales in Russia following the decrease of the rouble exchange rate during the last two months of 2014, according to the official.

The Ministry of Tourism hopes that the rouble collapse will not affect tourist flow for the next two months, using the incentives policy with tour organisers in this market.

The government exempted Russian tourists from entrance charges costing $25 from mid-January until the end of April.

The European Union extended sanctions against Russia until September, to pressure it to resolve the Ukraine crisis in the Crimean Peninsula.

“Of course the extension of economic sanctions against Russia will affect the tourism flow to Egypt as long as the problem is ongoing. The sector cannot solve this issue because we deal with the global changes and work on reducing their impacts as per the capabilities we have,” said the official.

Minister of Tourism Hisham Zaazou is studying a proposal to encourage charter flights again with the vacant seats system, according to the official. This will be instead of the offered incentives in accordance with the system of occupied seats.

Chairman of the Tourism Development Authority told Daily News Egypt last Thursday that the authority will focus on intensifying publicity in Eastern Europe and South and East Asian countries. This will overcome the Russian flow reduction.

According to the official, in case the European sanctions against Russia extend, its tourism flow will decrease with rates ranging between 20% and 30% at the very least.

Egypt has very low chances to target visitors from new markets, especially from East and South Asia, where there are no airlines, and EgyptAir would be the only airline to rely upon, according to the official.

He noted that the targeted rate from new markets would not exceed 10% in all cases, and this is a very low rate in light of the growth of an individual’s income in these markets.

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