The Central Bank announced a surprising number regarding remittances from Egyptians abroad. I wonder how much remittances from Egyptians abroad have reached now… What are the reasons for the return of the large increases in remittances from Egyptians working abroad?
Over a long period, the Egyptian economy suffered greatly from a shortage of foreign currencies, especially the dollar. This was due to the unusual activity of the black market in currency trade, which was a threat to the Egyptian economy. All foreign currencies in the Egyptian market were going to the black market, especially since the selling price there was higher. A little lower than the official bank rate.
The state of confusion that the Egyptian economy was in, which continued for fairly long periods, until the government took more than one measure to revive the Egyptian economy. The first steps were the signing of the tourism investment deal in Ras al-Hikma, which brought $34 billion into Egypt directly to the Central Bank, and this was a tool for the government to save the dollar. For suppliers and importers to provide all the needs that the Egyptian market wants, especially since suppliers and importers were an important tool for those in charge of the black market in playing with prices. Especially since the suppliers were buying the dollar from the black market at a higher price than the official price in the banks in order to provide the needs that we import from abroad, and at the moment they were collecting the dollar from citizens at a slightly lower price and selling it back to the suppliers, importers and people who need the dollar at the highest price, and therefore they had the market that Especially for them in currency trading.
Ok, what did the government do to eliminate the existence of the black market in dollar trade?
After the government signed the tourism investment deal in Ras Al-Hikma, here came the important decision that the state took at the beginning of March of this year, which was to liberalize the dollar exchange rate in a flexible manner against foreign currencies. This decision stipulates the free rise and fall of the foreign exchange rate in banks. Without restricting the official price as it existed before, especially since restricting the exchange rate to a specific number was the main reason for the existence of a black market in Egypt.
After this decision, all the dollars that were present in the Egyptian market were returned to the banks, especially the dollars that were present in homes, most of which came from remittances from Egyptians abroad, which the state currently considers to be an important source of dollar income for Egypt from abroad, and currently they are number one after a decline. Suez Canal revenues after the events in the Middle East.
Yesterday, the Central Bank announced an important decision, which was to increase remittances from Egyptians working abroad, which reached $2.7 billion, compared to about $1.3 billion last September.
The Central Bank also said that remittances from Egyptians working abroad in the first quarter of the fiscal year 2024/2025 for the months of July, August and September amounted to $8.3 billion, compared to about $4.5 billion in the same period in 2023, and the rate of remittances from Egyptians abroad from the beginning of 2024 until now reached 20. 8 billion dollars compared to about 14.6 billion dollars.
