Foreign currency inflows to banks exceed $120B: Tarek Amer

CAIRO – 14 May 2018: Foreign currency inflows to banks operating in Egypt have risen to more than $120 billion since the flotation of the Egyptian currency in November 2016, Central Bank of Egypt (CBE) Governor Tarek Amer told local newspapers.

Amer announced targeting to pump LE 30 billion ($1.68 billion) in small enterprises to benefit 8-10 million citizens, adding that around LE 10 billion is going to facilitate medium enterprises.

He added that the government would pay a debt of $850 million to international oil companies.

“We enabled to attract around $25 billion from treasury bills and around $10 billion from the Egyptian Exchange (EGX), to raise the total foreign investments to $35 billion,” Amer said.

Egypt recorded the highest GDP among developing countries, ranking number six or seven in Morgan Stanley’s index for growth after China, Malaysia and India, he added.

Amer said earlier that all restrictions on foreign exchange in Egypt have been canceled, clarifying that investors now can manage their financial situations and get the foreign currency they want.

He pointed to the availability of liquidity necessary to finance projects, reaching all levels of society through financing small and medium enterprises.

The CBE also announced that Egypt’s foreign reserves stood at $44.03 billion at the end of April for the first time in history, with an increase of $1.42 billion, compared to $42.6 billion by the end of March.

The state’s foreign reserves rebounded after clinching the first tranche of the International Monetary Fund’s (IMF) loan.

The IMF’s executive board approved in November 2016 a three-year Extended Fund Facility (EFT) loan to Egypt worth $12 billion to support its economic reform program.

The current average of foreign reserves covers about eight months of Egypt's commodity imports, which is higher than the global average of about three months of commodity imports.

Egypt spends an average of $5 billion monthly on imports with an annual total of more than $60 billion.

Foreign currencies of Egypt’s foreign reserves include the U.S. dollar, euro, Australian dollar, Japanese yen and Chinese yuan.

The main function of the foreign exchange reserve, including its gold and various international currencies, is to provide commodities, repay the installments on interest rates of external debt, and to cope with economic crises.