Plenty of options on the table
CBE looks at proposals to help shore up FX liquidity: The Central Bank of Egypt (CBE) is mulling a handful of options as part of its strategy to increase FX liquidity, after CBE Governor Hassan Abdalla met with the heads of the nation’s banks on Sunday, Bloomberg Asharq reports, citing sources it says attended the meeting.
The options reportedly on the table include:
- Offering service and funding incentives in exchange for tourism operators and hotels depositing their FX in local banks;
- Launching USD-denominated savings schemes for Egyptian expats;
- Easing banks’ regulatory requirements (including KYC regulations) for customers making USD deposits;
- Mulling the use of USD derivatives.
This week has seen extensive discussion on how to bring in more FX: Abdalla’s meeting with the country’s banking bigwigs appears to have coincided with discussion in the Senate of a report by the pro-government Mostaqbal Watan party that aims to overhaul how we approach foreign direct investment (FDI), with the ultimate goal of ramping up our USD inflows. Abdalla also met with Prime Minister Moustafa Madbouly on Sunday, where the pair stressed that they’re working to boost foreign reserves by drumming up FX, including by attracting more FDI, boosting tourism, and through the expat car import scheme.
ICYMI- Through December, we’re publishing a series of conversations with top CEOs on our five-step recipe to boost FDI and exports. Catch our discussion with Somabay’s Ibrahim El Missiri in today’s issue, above.
ALSO FROM THE MEETING-
More time for banks to ramp up MSME loan portfolios: Banks will reportedly get a one-year grace period to comply with a previous CBE directive to increase micro, small, and medium enterprises’ share of their loan portfolios to 25%, up from 20% previously, Masrawy reports, citing sources who attended the meeting. The deadline is now set for December 2023, the sources say.