The Central Bank of Egypt (CBE) has succeeded in meeting the cumulative dollar demands of $49bn since the flotation of the pound in November 2016 until August 2017, according to a press release on Wednesday, indicating a breakthrough in the crisis of foreign exchange shortage suffered by Egypt recently.
According to a CBE official who spoke to Bloomberg, the dollar liquidity was directed to meet the needs of foreign trade importers and foreign companies repatriating their profits and paying the arrears owed by the state.
The funds secured by the CBE includes $522m to foreign companies repatriating their profits.
The CBE also covered a demand worth $2.1bn by importers and companies to settle temporary overdrafts they made before floating the pound.
The CBE noted earlier that it covered dollar demand worth $1.5bn to multinational companies that wanted to repatriate funds.
Senior economist at Arqaam Capital Reham al-Desouky said that these numbers point to the recovery of the economy and to the increase in the ability of the CBE to meet its foreign currency needs.
She added that the CBE’s transparency policy, in line with its pledges to the International Monetary Fund (IMF), has been widely accepted and will help reassure investors.
The official at the CBE said that the Egyptian General Petroleum Corporation (EGPC) has received provisions in foreign currency worth $6bn between November 2016 and July 2017 for new deals.
This is in addition to $2bn to pay part of the EGPC’s arrears to foreign oil companies, accumulated during the dollar crisis.
The foreign exchange reserves recorded $36bn in July 2017, recording its highest level since January 2011. Prime Minister Sherif Ismail said recently that the reserves will rise higher in the next few months.