CBE manages to increase Egypt’s foreign reserves for 5th month in a row

The foreign reserves of the Central Bank of Egypt have been witnessing continuous increases since last September, thanks to the bank’s continuous efforts in this file led by Hassan Abdullah, Governor of the Central Bank.

The reserves increased by about $221 million during January, recording $34.224 billion by the end of January 2023 compared to $34.002 billion by the end of December 2022.

Due to the diversity and improvement of Egypt's foreign exchange resources, especially from tourism revenues and the proceeds of commodity exports (oil and non-oil), in addition to the escalation of the Suez Canal transit fees .

Furthermore, the measures taken by the Central Bank to restore balance in the foreign exchange market and reduce pressure on the currency, most notably its directives  towards the control of the supply of gold export proceeds; to be within 7 working days from the date of shipment, instead of 180 days. In addition, the restrictions the CBE has put on the use of credit and debit cards abroad.

Despite the fact that Egypt paid dues related to foreign indebtedness during last December, which reached $1 billion, while it had paid $1.5 billion last November. Thus the total payment of external obligations has recorded 2.5 billion dollars within two months, according to last January statement to a responsible banking source.

Since assuming his position at the helm of CBE; Abdullah has been aiming to double Egypt’s foreign reserves within 4 years, as he previously stated. CBE seeks to rebuild international reserves in a gradual and sustainable manner in accordance with the Monetary Fund reform program after ensuring that the funding gap is bridged in the upcoming 4 years.

 The International Monetary Fund expected that the total international foreign exchange reserves of the Central Bank of Egypt would rise to about $80 billion within five fiscal years.

According to the Fund’s estimates, foreign reserves will reach $47.2 billion by the end of 2023-2024, then $51.4 billion by the end of June 2025, then $63.9 billion in June 2026, to rise to $77.8 billion by the end of June 2027, then $79.9 billion by the end of June 2028.

It is worth noting that Egypt and IMF reached an agreement that provides Egypt with $3 billion in financing for 48 months and enables it to attract $14 billion in financing from international partners and agreements to sell assets with Gulf countries, in addition to $1 billion from the IMF's Sustainability Fund.