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Egypt is faced with a foreign exchange crisis that has affected businesses, Financial Times is reporting.
Importers have been adversely affected by the country’s foreign exchange shortage, according to the report.
Egypt uses a flexible exchange rate regime where the FX rate is dependent upon the supply and demand of money in the market.
The first three weeks of Russia’s invasion of Ukraine in February led to $20 billion of outflows from the country as foreign portfolio investors rushed to safe havens.
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Despite $13 billion in deposits from the United Arab Emirates (UAE), Saudi Arabia, and Qatar, and another $3.3 billion in asset sales to the UAE in 2022, foreign currency has remained in desperately short supply for the import-dependent country, the report noted.
