10 main tasks before CBE’s new board

Hossam Mounir
17 Min Read

The Central Bank of Egypt’s (CBE) board will hold on Sunday its first meeting after President Abdel Fattah Al-Sisi reformed it last Wednesday for the next four years.

The presidential decree No. 678 of 2019 stipulated the appointment of Gamal Negm and Rami Abul Naga as deputy governors, along with a representative from the Ministry of Finance. The decision also included appointing Mohamed Omran, the head of the Financial Regulatory Authority (FRA), and Ali Faramawi, a banking expert, Naglaa El-Ahwany as an economic expert, Ashraf El-Araby as an economist, and Tamer El-Dakkak as a legal expert.

The decision indicated that the appointment of members with experience is 4 years, starting from 27 Noveber 2019. This formation resulted in the departure of Lobna Helal, Deputy Governor of the CBE, Kamal Abu Elkhair, Laila Al Khawaga, Khaled Abdel Rahman, Yahia Al-Dakrouri, and Fakhry Elfiky, while Gamal Negm remained deputy governor and Mohamed Omra remained as head of the FRA.

Al-Sisi issued a decision in November to renew Tarek Amer’s term as Governor of the CBE for another 4 years, to continue until November 2023.

Gamal Negm

Gamal Negm, CBE’s dynamo

Gamal Negm, who was kept as deputy governor of the CBE, in considered the “dynamo” of the CBE. He is also tasked with the banknote printing and risk management department.

Negm is a board member of the FRA, a member of the Board of Trustees of the Anti-Money Laundering Unit in Egypt, and a non-executive chairperson of the Arab International Bank.

From February 2008 until November 2011, Negm held the position of Sub Governor of the CBE for the Supervision Sector, where he supervised various departments, the office, banking affairs, cash control, credit risks, issues, overall risks, supervisory instructions, and Basel applications, until he was appointed deputy to the CBE governor.

Since joining the CBE in July 2004, Negm was responsible for the bank’s development, overseeing the implementation of the Egyptian banking sector’s development plan, which is to address the problem of non-performing debt in banks, the administrative and financial restructuring of public sector banks, and support and development of the monitoring and supervision sector in the CBE.

Prior to joining the CBE, Negm had 25 years of experience in the banking field, during which he held several positions in the top management of international and local banking institutions that enriched his experience in the field of credit and risk management, internal audit, and financial supervision.

Rami Abul Naga

Rami Abul Naga: Young experience in reserve management

Rami Abul Naga was appointed CBE deputy governor. He previously held the position of CBE’s sub governor for the money market sector and the cash reserve management. Abul Naga took charge of supervising and managing the international investment portfolio and management of foreign exchange reserves, negotiating with international financial institutions to attract more foreign investments, discussing various financing methods, communicating with credit rating institutions, and supervising the implementation of monetary policy through the management of local liquidity and open market operations. He was also responsible for the follow-up of developments in domestic and international money money markets, and also participated in negotiations with the International Monetary Fund (IMF), and was responsible for regulating the fund’s programme and its compatibility with the requirements of the CBE and the Egyptian economy.

Abu El Naga joined the CBE in 2005 as a manager of the short-term investment portfolio in the cash reserve management. In 2014, he was appointed as head of the reserve management, treasury, and trading department. In 2016, Abu El Naga was promoted to assistant sub governor for the markets sector, then the sub governor for markets.

He is a graduate of the American University in Cairo with a major in Business Administration and Economics and holds a master’s degree in finance from City University in the United Kingdom. He had also obtained many training courses and certifications approved by various international institutions, such as the World Bank, the US Federal Reserve, the German Central Bank, and others.

Ashraf El-Araby

Ashraf El-Araby: economic experience in the field of planning

Ashraf El-Araby, the former Minister of Planning, has been appointed as a member of the CBE’s new board.

He is an economic expert specialised in planning and economic development, having almost 20 years of experience in the field.

He had taken the position of Minister of Planning, Follow-up and Administrative Reform in 5 successive ministerial portfolios, where he held this position in Ibrahim Mahlab’s cabinet during his first term, the cabinet of Ibrahim Mahlab for his second term, the cabinet of Hazem Beblawi, and the cabinet of Hisham Kandil. El-Araby combines both theoretical knowledge and practical experience, where he  published many research papers in prestigious local, regional, and international periodicals and taught at Kansas State University, Cairo University, and the French University in Cairo.

He was born on 14 December 1970 and holds a Bachelor’s Degree in Economics from the Faculty of Economics and Political Science at Cairo University in 1992, then a master’s degree in economics from the same college in 1997, and received a doctorate from the University of Kansas in America in 2004, which gave him the award for the best graduate student in Department of Economics at the university.

Ali Faramawy

Ali Faramawy: representative of the technology sector

Ali Faramawy was also appointed member of the CBE’s new board to represent the technology sector, a sector that plays a major role in achieving the goals of the state and the CBE for disseminating financial inclusion and electronic payments.

Faramawy was previously appointed as a member of the advisory council of President Abdel-Fattah Al-Sisi.

Faramawy was born in Alexandria Governorate in 1964, and obtained a Bachelor’s of Engineering from Alexandria University in 1986, a diploma in Computer Science in 1992, and a Master of Business Administration “Strategic Marketing” from the British University of Hull in 1998. Faramawy joined Microsoft in 1997 and started in his capacity as general manager of the company in Egypt, and held many high-level positions, most notably the position of the regional director of the company for sales, marketing, and services in the Middle East and Africa in 2002. He also held the position of Vice President of the company in Europe, Middle East and Africa in 2004, and has been vice president of the company since 2011.

Tamer Al Dakkak: a prominent legal personality

Tamer Al Dakkak, vice president of the State Council and legal adviser to the CBE is a prominent legal personality, due to his great experience. His role came out strongly with talk of the new banking law, which the CBE was preparing for in two years.

The choice of Al Dakkak in the formation of the Board of Directors of the CBE is an important and positive matter in light of approaching the application of the new banking law, which would establish governance and supervision in the CBE and legalise the introduction of digital technology, without prejudice to the achievement of the safety allocated for Egyptian banks.

Nagla El Ahwany
Nagla El Ahwany

Nagla El Ahwany: sole female member of the board

Nagla El Ahwany also has great economic experience due to her professorship at the Faculty of Economics and Political Science at Cairo University, and she also held the position of Minister of International Cooperation in the cabinet of Ibrahim Mahlab, the first government under President Abdel-Fattah Al-Sisi.

Nagla El Ahwany is an academic personality with many pieces of research in economics, and she held many academic positions, including executive director and chief economist at the Egyptian Centre for Economic Studies, and director of the Centre for European Studies at the Faculty of Economics and Political Science.

El Ahwany also held consulting positions in the American Chamber of Commerce in Cairo, the International Labour Organisation office in Cairo, and the Economic and Social Commission for Western Asia.

Mohamed Omran: voice of non-financial service providers

Mohamed Omran

Mohammed Omran, chairperson of the FRA, was reappointed to the CBE Board of Directors. He holds a Master’s Degree in Business Administration from Cairo University, and a Ph.D. in Finance from Plymouth University in the United Kingdom.

Omran previously was deputy chairperson of the Egyptian Exchange from 2006 to 2010 and then became head of the EGX from September 2011 up until right before the June 2013 revolution, then he refused to work under the umbrella of the Muslim Brotherhood’s rule.

He returned in August 2013 until June 2017, and served as chairperson of the Eurasian Stock Exchanges Association, Professor of Finance at the Arab Academy for Science and Technology, and also served as vice-chairperson of the Holding Insurance Company for operations for a year.

Mohamed Abdel Aal, banking expert

Mohamed Abdel Aal, a banking expert, and a member of the Suez Canal Bank Board of Directors said that the CBE board of directors, in its previous formation, succeeded in ferrying the Egyptian economy to safety and beyond, after its success in supervising and contributing to the implementation of the economic, monetary and financial reform programme, in cooperation with the IMF, bearing full responsibility for all its results.

He added that the new board is an extension of the previous one, as it includes experts among its members who have knowledge and experience, each in their field of specialisation, in addition to the executive members, who are the governor and his deputy.

Mohamed Abdel Aal

He pointed out that if the previous board succeeded in carrying out its mission, in difficult circumstances, along with the testimony of all global banking and economic circles. He is confident that the new board will achieve the same level of success in the next stage.

Abdel Aal pointed out that this stage may be more difficult in terms of challenges, burdens, and responsibilities, because it requires fixing, devoting and maintaining the gains achieved by the economic reform programme, and pushing and directing the banking sector towards demanding contemporary global technology.

Abdel Aal stressed that the Board of Directors of the CBE in its new formation is fully aware of its vital and important role defined in its strategic plans, laws, policies, and procedures. Everyone knows the high academic and practical level of its members, and that they are able to implement the CBE’s visions in accordance with the most sophisticated global technological transformations.

Maintaining the independence of the CBE

The first task on the agenda of the new board of directors of the CBE is to preserve its independence and its monetary policy. The CBE’s monetary policy is the main axis and cornerstone of the Egyptian economy since the CBE represents the Egyptian economy’s national security while setting up controls that prevent conflicts of interest.

He said that the new board of directors will also have to strengthen the supervisory role over banks in the next stage, which is one of the more dangerous tasks, given that 89% of Egyptian society’s savings are kept in bank accounts.

According to Abdel Aal, there is another important file before the new board of directors, which is to maintain price stability, a reasonable rate of inflation, within the limits set by the board of directors, and also maintain a balanced monetary policy, in relation to the interest rate, which reflects the balance between the requirements of economic growth, the reduction in the cost of public debt, and a positive real interest rate, helps to develop family savings.

He pointed out that the CBE in its new formation is also required to maintain the stability of the exchange rate in a way that reflects the mechanism of supply and demand, and achieve a balance between market forces, exporters, importers, and others.

He said, that there is another important task, which is overseeing a coordinated strategy with the relevant ministries in the country to encourage the national industry. This would enable the national industry to increase its contribution to the gross domestic product, and improve Egypt’s attractiveness in direct and indirect investments, pointing out that monetary policy will play a crucial role, along with the revitalisation initiative announced by the CBE.

Among the tasks entrusted to the new board of directors, according to Abdel-Aal, is overseeing the implementation, activation, and proper application of the initiatives that were launched to support industry, housing, and tourism, and work to renew previous initiatives related to financing low and middle-income housing.

Concluding a new agreement with the International Monetary Fund

He said one of the most dangerous and most important tasks is also the possibility of concluding a new agreement with the International Monetary Fund (IMF), and studying the dimensions and feasibility of this agreement, whether in terms of its objectives or areas, and whether the potential agreement with the fund will be limited to technical support and structural reform. These agreements will have to come after the success of the financial and monetary reform and may help in developing a contract for a credit preparedness programme or a new negotiated financing package with the fund.

Abdel Aal pointed out that among the tasks assigned to the new board of directors is also to maintain the level of cash reserves to preserve the adequacy of balances to cover Egypt’s import needs for a period of no less than 8 months. He pointed out that this goal is important as it helps stabilise the Egyptian currency and Egypt’s fulfilment of international obligations and continue import flows.

The tenth task before the CBE Board of Directors with its new formation is, according to Abdel Aal, to achieve financial inclusion via electronic payment transformation .

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