There has been a “breakthrough” in foreign currency reserves needed to import raw materials, factory components and basic commodities, said Federation of Egyptian Chambers of Commerce (FEDCOC) Head Ahmed El-Wakil.
In a statement, El-Wakil said the General Division of Importers within the federation has confirmed the development in foreign currency availability. He attributed the improvement to the recent Central Bank of Egypt (CBE) instructions regarding prices of exchange.
The US dollar’s value is expected to continue rising, according to the expectations of the Federation of Egyptian Industries (FEI) head, Mohamed El-Sewedy, announced during a press conference last month. He added that the rise of dollar’s value will reach EGP 8 before the Economic Summit in March.
After maintaining the same value at EGP 7.14 over the past six months, the CBE announced last December that it will raise the number of weekly dollar bids.
The devaluation of the Egyptian pound started on 18 January, when $1 was equivalent to EGP 7.19, as it fell the following day to reach EGP 7.32. This devaluation is believed by economists to be a reassurance to foreign investors who would like to invest in Egypt using dollars. Others argued that prices of consumer goods such as medicine, oil and some food products will only get higher.
Since the end of the transition period with the election of former president Mohamed Morsi, the value of Egyptian pound has continued to depreciate against US dollar, from EGP 6.07 to EGP 7.59.