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Wednesday, 28 September 2022

Import issues could be resolved within two months, El Sisi signals

El Sisi wants import woes fixed within two months: Import challenges facing manufacturers will be solved within two months, President Abdel Fattah El Sisi said yesterday (watch, runtime 8:37). “The state is serious about solving the problems of investors, including the issue related to production inputs and their shortage in the markets during the past two or three months,” he said, speaking during the inauguration of several projects. The president said that he’d spoken to Central Bank of Egypt (CBE) Governor Hassan Abdalla about resolving the crisis. “I imagine within a month or two, all the obstacles will be resolved.”

Importers are having a rough time right now: Many businesses are unable to source the foreign exchange they need to import production inputs — let alone to bring in finished goods. This has caused shortages of industrial and consumer goods, forcing manufacturers and assemblers in some sectors to slow or even suspend production and some to lose “tens of mns of USD” a day. The CBE last week eased restrictions to allow importers to use some of their FX balances to pay for imports, but they remain unable to use any FX that entered their accounts after 19 September. And the pace at which letters of credit are being issued? Still very slow.

The economic conference is coming next month: These issues will come up during the Madbouly government’s economic conference, which will take place next month, El Sisi said. The conference will give the business community a chance to voice their concerns to the government on the problems and obstacles they face, he said. The final draft of the state ownership document, trade policy, and industrialization will also be on the agenda for the conference, which was originally expected to happen at the end of this month.

All of this is geared towards increasing exports: The government is looking to increase exports to USD 100 bn a year by 2025, partially through a new focus on localizing manufacturing and increasing revenues from gas exports, which it hopes to double to USD 1 bn a month. Export revenues climbed 58% to USD 32.5 bn in 9M 2021-2022 from the same period the year prior.

On a related note: El Sisi wants private sector employers to set up more vocational schools to help train up the labor force, ensuring that employers have access to skilled laborers and that workers have the skills they need to land good jobs. The president also emphasized the important role of research and development facilities in identifying and developing solutions to pressing issues facing businessmen and industrials.

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