Egypt's banking sector's net external assets deficit decreased to $4.2 billion in March 2024, down from $21.9 billion in February, a significant decrease of approximately $17.7 billion. This change is due to the change in the dollar sales price, which was 30.94 Egyptian pounds in February and 47.26 Egyptian pounds at the end of March.
This first positive change in two years was driven by dollar inflows from the Ras Al Hikmah project and exchange rate liberalization.
Egypt secured $10 billion from Abu Dhabi Holding in two installments, at the close of February and at the beginning of March, according to a report from the Central Bank of Egypt (CBE). Additionally, $5 billion in Emirati deposits were settled as part of the massive $35 billion Ras Al Hikmah development deal, the largest investment in Egypt's history.
The banking sector's net external assets have been on the decline since October 2021, turning negative in February 2022 when foreign currency liabilities exceeded local currency assets, coinciding with the outbreak of the Russia-Ukraine conflict.
According to the CBE's latest report, the banking sector's total external assets (including central banks and commercial banks) reached EGP 2.959 trillion at the end of March, up from EGP 1.574 trillion in February. increased to Conversely, the sector's debt was EGP 3.159 trillion, up from EGP 2.253 trillion.
