CAIRO, Oct 31 (Aswat Masriya) – Egypt’s Prime Minister Sherif Ismail told the parliament on Monday that the government is working with the central bank to unify the dollar exchange rate.
The gap between Egypt's official and unofficial dollar rates continue to increase as the central bank's official rate stands at EGP 8.78 to the dollar, while, according to several news outlets, it exceeds EGP 17 on the black market.
Ismail said that actions regarding the currency crisis should be taken at a time that “reflects the real value of the Egyptian pound”, stressing that the central bank will unify the dollar exchange rate soon.
He said the previous adjustment to the pound exchange rate led to negative outcomes because it took place in the absence of “proper instruments”.
Egypt devalued the pound by 13 percent in March in an effort to close the gap between the official and parallel rates but the move failed to boost dollar liquidity or close the gap.
The cash-strapped government is close to finalising a deal with the IMF over a three-year $12 billion funding facility meant to plug the funding gap, restore market confidence and encourage investment. In return, Egypt is expected to carry out several economic reforms, with the currency devaluation reportedly being one of them.
Egypt's foreign reserves are currently estimated at $19.5 billion, still less than half its reserves held before the 2011 uprising that ended President Hosni Mubarak's 30-year rule.