Crisis returned Hard currency in Egypt It reappeared during the past two weeks, after a number of banks stopped opening new letters of credit or collection documents for importers, due to the scarcity of the dollar in the largest market in the region in terms of the number of consumers.
It was Egyptian Central Bank Last October, he “gradually” canceled the instructions for using documentary credits in import financing operations, leading to their complete abolition in December, and returning to the old system through “collection documents.”
This coincided with the liberalization of the exchange rate, and banks began to provide dollars to importers. However, the situation changed during the past two weeks amid a severe shortage of hard currency, which was reflected in an almost complete halt to import operations, with the exception of fuel and food.
One of the major importers of household appliances in Egypt told Al-Sharq, on condition of anonymity, that “the (import) process has been completely stopped for two weeks, as there is no hard currency, and the banks are satisfied with agreeing verbally, but it is not implemented, to return and claim that it is proceeding according to priorities.” In parallel with the sharp rise in the price of the dollar in the parallel market.. and we do not know what to do.
Al-Sharq sent a text message to the Central Bank of Egypt to find out its opinion about the availability of hard currency for importers, but it did not get an immediate response.
funding gap
Egypt did not succeed in reaching an agreement with International Monetary Fund To obtain direct financing worth $3 billion, within credit facilities exceeding $9 billion, in attracting foreign investments to the country, especially to the stock market, from which more than $20 billion of hot foreign money has exited since the Russian-Ukrainian war, according to statements by Finance Minister Mohamed Maait. .
Egypt needs $28 billion until the end of 2023 in order to refinance its outstanding debts, pay debt interest and finance the current account deficit, according to Deutsche Bank, in addition to an additional $20 billion required in the following year. Egypt’s net international monetary reserves, which are just over $33 billion, cannot bear this burden. This has caused fears that Egypt will continue to need to tap the debt markets.