Hisham Okasha, Chairman of the Board of Directors for the National Bank of Egypt (NBE) expressed optimism regarding the future of the economy and its potential for growth within the coming months.
Okasha said the country possessed a number of strong economic indicators, including improved infrastructure, the construction of new tourist facilities and a well-trained work force capable of achieving high levels of production.
The biggest problems have always been political, he said, adding that the country’s previous negative economic indicators, in particular that of international credit downgrades, were all the result of the polarised state of politics. This was the opposite of Greece, he said, whose problems were purely economic since the initial outbreak of its crisis.
In a statement made to state-run MENA, Okasha emphasised that all available domestic data showed that Egypt was on course to enter a new, positive stage in its economic development, a fact which would once again attract foreign investment.
He stated, however, that for such development to occur, protests and sit-ins would need to stop, along with exclusionary demands made by some sectors of society which do not put the country’s national interest first, and that steps would need to be taken to improve the country’s security situation, in addition to working to better implement the law.
Okasha was recently appointed Chairman of the Board of Directors of NBE following the resignation of his predecessor, Tariq Amr in January.
He said even the country’s black market currency exchange, which flourished under the rule of the Muslim Brotherhood, and, despite’s its fragile state, was able to have a large negative effect on the country’s economy.
He feels that the economy began to stabilise since the appointment of the new interim government. The price of the dollar on the black market, he said, began to decrease and match that of official exchange rates.
He also discussed previous problems regarding monetary transfers made by Egyptians living abroad, who would withdraw money in the same currency in which it was initially deposited. This led banks to claim low foreign currency reserves, saying that NBE’s daily collection rates of foreign currency transfers while the Brotherhood was in power was just between $3m and $5m per day.
Since the removal of President Mohamed Morsi, he said, such numbers have once again returned to their normal rates, fluctuating between $10m and $15m per day. As a result, banks have been able to begin buying larger amounts of foreign currency in Egyptian pounds, increasing their total foreign currency reserves.
He mentioned additional positive economic indicators, including $12bn in aid recently received from Arab countries, a result he said of their newfound confidence in Egypt’s current government. Acceptance of such aid, he said, has helped increase confidence in the overall economy.
He stated that while the world had previously viewed Egypt’s economy in a negative light, pointing out that the country’s credit default swap rate prior to 30 June had reached 8.5% on the dollar, that this number later dropped to 6% after international credit rating agencies took to reassessing the country’s economy after the events of the 30June.