Egypt's net foreign reserves fell to $15.119 billion at the end of March, Egypt's central bank announced on its website on Monday.

Reserves have fallen around $660.6 million over the last month, down from $15.72 billion at the end of February. This is a 50 per cent drop below the March 2011 level, when reserves stood at $30 billion.

"Until now, we’re still on the safe side," said Hany Genena, chief economist at Pharos Holding.

He explains that if this depletion rate carries on until June, Egypt could be faced with a crisis, if the country doesn’t acquire extra financing.

Egypt is to sign a $3.2 billion loan deal with the IMF for budgetary support in June, Bloomberg reported on Monday.

"If we secure the loan, and a new president enters office without problems, Egypt's balance of payment (BOP) deficit will be controllable," Genena added, indicating that he projects a BOP deficit of six to seven billion dollars in 2012, less than 2011's deficit of $18 billion.

Last week, a senior army financial report expected Egypt's foreign reserves to fall by over $5 billion to $10.4 billion by the end of June.

Such a level, which roughly translates into three months worth of Egypt's imports, would be extremely critical for the country.

"Egypt could face a rapid uncontrollable depreciation of the currency, which would lay tremendous pressure on Egypt's population and government," Genena argues. "Now we have a petroleum authority that is deeply sunk in debt and fewer sources of foreign currency."

He added that the electing a president by the end of June would play a great role in the return of economic activity to normalcy, which would help Egypt dodge a major crisis.

"We're okay as long politics is okay."

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