Egypt Won’t Devalue Egyptian Pound Against US Dollar: El-Okdah
The Governor of the Central Bank of Egypt Farouk El-Okdah insisted that there is no plans to devalue gradually the Egyptian pound and denied what was said that the International Monetary Fund (IMF) has conditioned its loan to Egypt on devaluing the Egyptian pound, affirming that the value of the Egyptian pound is determined by the rules of supply and demand.
On the sidelines of launching the National Bank of Egypt (Khartoum), El-Okdah affirmed that CBE did not and will never intervene in determining the exchange rates. Such policy has resulted in stabilizing the value of the Egyptian pound and devaluing the dollar against the pound.
The CBE did not issue new local currency notes from about nine years, but it only replaces old ones with new ones. He added that CBE will not issue 500 pound notes, which was said to be launched soon, because of the economic unrest that faces the country.
Egypt’s foreign cash reserves retreated from US$ 36 billion before 2011’s revolution, to US$ 15.1 billion at the current period because of many reasons. Firstly, the CBE paid US$ 12 billion, the value of treasury bills due to foreigners in order not to shake the investors’ confidence in the Egyptian market. In addition, CBE provided the Cabinet with US$ 350 million monthly to import petroleum products and US$ 300 million to import strategic goods in the last 19 months. Consequently, the country’s foreign reserves fell by US$ 21 billion.
EL-Okdah affirmed that these are the main reasons behind the decline of foreign reserves, denying what was said about using the foreign reserves in supporting the Egyptian pound against the dollar. The country’s foreign reserves are currently stable, because no more foreign investments are exiting Egypt, El-Okdah stated, adding that the value of foreign investments in treasury bills reached US$ 10 million.
