CBE cov­ered dol­lar needs worth $49bn since flota­tion

The Daily News Egypt - - Front Page -

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.

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