The net foreign assets deficit in Egypt's banking sector decreased to $4.2bn in March 2024, down from $21.9bn in February, marking a significant reduction of approximately $17.7bn. This change is attributed to the varying dollar selling prices: EGP 30.94 in February and EGP 47.26 at March's end. This positive shift, the first in two years, was bolstered by the influx of dollars from the Ras Al-Hikma project and the liberalization of the exchange rate. The Central Bank of Egypt (CBE) reports that Egypt secured $10bn from Abu Dhabi Holding in two instalments at February's close and March's start. Additionally, a $5bn Emirati deposit was settled, part of the extensive $35bn Ras Al-Hikma development agreement, the largest investment in Egypt's history. The banking sector's net foreign assets have been on a decline since October 2021, turning negative in February 2022—when foreign currency liabilities surpassed local currency assets—coinciding with the onset of the Russo-Ukrainian conflict. As per the CBE's latest report, the banking sector's total foreign assets (including central and commercial banks) reached EGP 2.959trn at March's conclusion, a substantial increase from EGP 1.574trn in February. Conversely, the sector's liabilities stood at EGP 3.159trn, up from EGP 2.253trn.
