Egypt's C.Bank extends two initiatives in support of tourism sector

The Central Bank of Egypt (CBE) has extended two initiatives supporting companies working in the tourism sector that were initially set to expire at the end of the year through March 2023, the bank announced on Sunday.

The CBE made the announcement in a circular sent to all banks operating in the local market.

The first initiative, which allows companies to obtain loans with a decreasing eight percent interest rate, within which the banks will accept the beneficiaries’ requests to delay dues repayment to the banks.

The initiative was first launched in 2013 and amended in 2021 to support the sector amid the severe impacts of the COVID-19 pandemic.

Under the amendment, the Ministry of Finance offered EGP 3 billion insurance credit for the CBE to give to national banks to provide three-year loans to hotels and tourist facilities with a discounted interest rate of five percent.

The CBE also extended a second initiative meant to provide retail loans to the sector’s workers.

During the three-month period, the banks will be required to carry forward the dues on the initiative’s beneficiaries, particularly for loans obtained by workers for consumption and personal housing.

This action will benefit only those who were punctual in repayments according to their financial standing by end of September 2022, according to the circular.

In line with the measures set by the International Monetary Fund (IMF) under its new economic reform programme with Egypt, which allows Egypt to receive $3 billion in loan, CBE handed off the management of the low-interest initiatives for agriculture, industry and construction sectors to the finance ministry with no intention to accept new clients.

As a result of the pandemic and the repercussions of the war in Ukraine, Egypt lost EGP 440 billion (about $23.4 billion) over the past two years, with tourism and civil aviation have been the most affected, according to the finance ministry.