According to banking experts, The recent extension of deposit deadlines by the UAE and Kuwait until 2024 and 2026, highlights the significant role played by Arab countries in supporting the Egyptian economy, especially during challenging global economic conditions.
The move is expected to support the cash reserves of the Central Bank of Egypt.
One banking expert, Ahmed Shawky, commented that the renewal of the two deposits is a positive indication of the strength of confidence in the Egyptian economy. Cash reserves are considered the last line of defence and are usually resorted to in a crisis.
Shawky further explained that before the outbreak of the coronavirus pandemic, Egypt had a foreign currency reserve of around $45 billion. However, it declined due to the pressures of basic needs to confront the pandemic. But, gradually, it has started to rise again.
He added that Egypt has many resources to increase its cash reserves, including tourism and remittances from Egyptians abroad.
Another banking source said that the volume of GCC deposits in Egypt, according to the latest available estimates, amounts to about $28.2 billion, divided into short-term deposits amounting to $13 billion and medium and long-term deposits totalling $14.9 billion.
Of these deposits, the UAE’s share is $10.7 billion, Saudi Arabia’s share is $10.3 billion, Kuwait’s is four billion, Qatar’s is three billion, and Libya’s about $900 million.
