Egypt’s foreign asset deficit edges lower for 1st time in 11 months

Ahram Online , Wednesday 1 Nov 2023

Foreign assets deficit at the Egyptian banking system declined for the first time in 11 months to reach EGP 812.41 billion ($26.29 billion) in July 2023, 2.66 percent lower than the previous month, according to data released by the Central Bank of Egypt (CBE) on Wednesday.

An employee counts U.S. dollars in a foreign exchange office in central Cairo, Egypt,
An employee counts U.S. dollars in a foreign exchange office in central Cairo, Egypt,

 

The released figure includes a deficit at both the CBE and banks in Egypt.

The foreign assets deficit at the CBE increased to EGP 312.94 billion in July 2023 from EGP 304.86 billion in June.

At banks in Egypt, foreign assets deficit edged lower to EGP 499.47 billion in July from EGP 529.74 billion in the previous month.

The net foreign asset deficit is the net total value of foreign assets owned by the country's banks, minus their foreign liabilities.

Egypt is actively seeking additional funding to close a $17 billion financing gap by 2026, which is projected to be between $6-8 billion for FY2023/2024.

The country must also procure more hard currency to honour its commitment to the International Monetary Fund (IMF).

Egypt is currently involved in a four-year $3 billion loan programme with the IMF that necessitates a series of economic reforms, including adopting a flexible exchange rate.

The country seeks to collect $191 billion in annual US dollar liquidity by 2026.

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