Egypt’s net foreign assets deficit contracted by $586 million in April to $3.68 billion, revealed the latest data from the central bank. This significant decline follows the International Monetary Fund’s $820 million loan instalment to the country early in the month.
In April, Egypt’s net foreign assets deficit shrank to EGP174 billion from EGP200 billion pounds at the end of March, marking the third month of decline.
This slight improvement is due to a decline in the gap between Egypt’s foreign assets and its foreign liabilities. The Central Bank of Egypt (CBE) reported holding EGP1.883 trillion in foreign assets at the end of April, while commercial banks held EGP1.195 trillion. Meanwhile, total foreign liabilities held by the CBE and commercial banks reached EGP32.523 trillion.
On March 6, Egypt signed an $8 billion financial support package with the IMF after floating its currency. Egypt received the first tranche totaling $820 million in April 2024, which triggered a flood of investments and remittances to the country.
In addition, remittances, portfolio investments and a $24 billion real estate investment from the UAE led to a $17.8 billion decline in Egypt’s net foreign assets deficit in March and $7.04 billion in February.
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Egypt received a $5 billion payment from the UAE for the development rights to Ras El Hekma in February, another $5 billion in early March, and a final $14 billion in early May.
Before the IMF agreement and the UAE’s investment, Egypt had been using its net foreign assets for more than two and a half years to help support its currency. In September 2021, net foreign assets stood at $3.9 billion.
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