Egyptian teller in an exchange company. Reuters.
Egypt's remittances dropped to $28.3 billion in 2022, a 10 percent decline from $31.5 billion in 2021, the report's data showed.
Egypt still topped recipients of remittances among countries in the Middle East and North Africa (MENA) in 2022.
The report expected Egypt’s remittances to increase in 2023 and 2024, but did not specify by how much.
The recovery is expected to drive remittance growth in MENA to 1.7 percent to reach $65 billion in 2023, before increasing by 1.8 percent in 2024 to reach a record $67 billion.
The growth in remittances is contingent on a set of factors including inflation rates and financial volatility, the report warned.
Egypt’s annual headline inflation bounced up again to hit 33.7 percent in May in comparison to 15.3 percent in May 2022, announced the Central Agency for Public Mobilisation and Statistics (CAPMAS).
The World Bank's report highlighted that MENA's remittances declined by 3.8 percent to $64 billion in 2022 from $67 billion in 2021, driven by the 10 percent decline in Egyptian transfers.
The World Bank attributed such decline to "Egyptians selling their foreign exchange on the black market due to the rising gap between the parallel market and official exchange rates or holding on to it amid concerns around a devaluation of the pound."
Since March 2022, the Egyptian pound has lost almost 50 percent of its value. The official exchange stands at around EGP 31 against the US dollar.
Remittances by Egyptians working abroad plunged by 23 percent during the first half (H1) of the fiscal year 2022/2023, declining to $12 billion from $15.6 billion in the same period a year earlier, according to data from the Central Bank of Egypt (CBE) in May.
Remittances are Egypt's main source of foreign currency, surpassing even the Suez Canal and tourism revenues. During H1 FY2022/23, the Suez Canal generated $4 billion while tourism brought in $7.3 billion.
Egypt depends on remittances for 7.8 percent of its GDP, according to 2021 figures from the World Bank.