FILE- Central Bank of Egypt
CAIRO – 9 May 2018: Foreign currencies’ balance in Egypt’s international reserves increased to $40.5 billion in April, up from $39 billion in March, increasing by LE 23 billion in one month, according to data from the Central Bank of Egypt (CBE).
Egypt’s foreign reserves reached $44.03 billion in April 2018 for the first time in history, compared to $42.61 billion at the end of March, according to the CBE.
The reserves are expected to further grow over the coming two years to reach $50 billion, banking sources said Wednesday.
They said that the reserves will be buoyed by tourism revenues, Egypt’s Eurobonds issuance, foreign direct investments and the savings from natural gas imports.
Egypt imports goods with an average of $5 billion monthly, meaning that the current reserves will cover around eight months of imports.
The international reserves in Egypt consist of a basket of five main currencies, namely, U.S. Dollar, Pound Sterling, Euro, Japanese Yen and Chinese Yuan.
Egypt embarked on a bold economic reform program in 2014 that includes cutting energy subsidies and introducing new taxes to cut the budget deficit.
It floated its local currency in November 2016, after which it clinched a $12 billion loan from the International Monetary Fund (IMF). Foreign reserves have been increasing since then. Reserves were only $19.041 billion at the end of October 2016.
A delegation from the IMF is currently visiting Egypt to review progress on economic reforms. The review is necessary before the fund disperses the fourth tranche of the $12 billion loan deal.
In December 2017, Cairo received the third tranche of the loan, worth $2 billion. The fourth disbursement will bring the total Egypt has received so far to $8 billion.