The Central Bank of Egypt (CBE) removed caps on foreign exchange deposits and withdrawals for companies importing essential goods on Wednesday to increase liquidity in the dollar-starved economy.
The decision came a day after the CBE lifted caps on withdrawals by individuals. “The initial [reactions] of the bank’s decisions started to show today, as the currency market appeared calm after [people] realized that they can withdraw and deposit at anytime,” said CBE Governor Tarek Amer. He also said on Tuesday that removing caps on individuals would help the CBE increase Egypt’s foreign reserves to $25 billion by the end of 2016. The CBE also held a meeting with foreign exchange bureaus in an effort to keep black market rates under control. Exchange bureau sources said the meeting resulted in putting a limit on the black market’s dollar value. “The agreement was not to exceed the 9.25 pounds to the dollar price on the parallel market in return for the central bank not interfering with exchange bureaus,” a source said. [Bloomberg, Reuters, 3/9/2016]
Saudi Arabia’s Prince Sultan bin Salman said Tuesday the kingdom has focused on job creation. The Prince said the fall in oil prices has prompted Saudi Arabia to rethink its economic and spending policies. “I think it’s good to go into a mode in Saudi where we begin to re-eye the economy,” he said. When oil prices were higher, he said, the government did not do enough to diversify the economy. “I have been in fact criticizing, if you like, the government’s funding of so many sectors that have not yet produced the jobs, so many sectors that have not really added value to the economy,” he said. The Prince, who heads the Saudi Commission for Tourism and National Heritage, said the kingdom’s tourism industry can create such jobs for Saudis. In an effort to provide more jobs to Saudi citizens, the Ministry of Labor also said Tuesday that it will ban foreign workers from the mobile phone industry. [AP, 3/8/2016]
Saudi Arabia is seeking a bank loan of between $6 billion and $8 billion in what would be the first significant foreign borrowing by the Saudi government in over a decade. Riyadh has asked lenders to submit proposals to extend it a five-year US dollar loan, sources said. Last week, Saudi Arabia had asked banks to discuss the idea of an international loan, but details were not specified. London-based advisory firm Verus Partners, set up by former Citigroup bankers, is advising the Saudi government on the loan, sources said. The firm has sent requests for proposals to a small group of banks on behalf of the Saudi Ministry of Finance. [Reuters, 3/9/2016]
The world’s largest oil exporters both in and outside the Organization of the Petroleum Exporting Countries (OPEC) plan to meet in Moscow on March 20 to discuss an output freeze, Iraq’s Deputy Oil Minister Fayadh al-Nema said. “[Iraq] is prepared to cooperate to discuss a plan to freeze production levels with the most prominent oil producers in the world and to guarantee that Russia and Saudi Arabia, the biggest oil producers and exporters, will sit at the negotiating table.” Russia’s Energy Ministry spokeswoman said Wednesday that no date has been set for a possible meeting between OPEC and non-OPEC nations. Russian Energy Minister Alexander Novak said last week that a meeting between OPEC and other leading oil producers could take place between March 20 and April 1, possibly in Russia, Vienna, or Doha. On Tuesday, Kuwait’s acting Oil Minister Anas al-Saleh said Kuwait will commit to a potential global oil production freeze if major oil producers join the pact. [Reuters, 3/9/2016]
London-based Standard Chartered Plc is in talks with Iraq’s Finance Ministry to take part in a $2 billion bond sale this year. The bank is also holding talks with other government institutions about their financing needs, Chief Executive Officer in Iraq Andreas Meletiou said Tuesday. “We also want to partner with the [Iraqi] government in their efforts to rebuild Iraq and assist in the modernization of the banking sector,” Meletiou said. “We have been in discussions with the Ministry of Finance on its $2 billion bond issuance, anticipated to take place in 2016.” Meletiou said the bank’s main focus in Iraq is to serve international clients operating in the country’s power, water, oil, gas, telecoms, and infrastructure industries. [Bloomberg, 3/9/2016]
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Egypt further eases restrictions on foreign currency
The Central Bank of Egypt (CBE) removed caps on foreign exchange deposits and withdrawals for companies importing essential goods on Wednesday to increase liquidity in the dollar-starved economy. The decision came a day after the CBE lifted caps on withdrawals by individuals. “The initial [reactions] of the bank’s decisions started to show today, as the currency market appeared calm after [people] realized that they can withdraw and deposit at anytime,” said CBE Governor Tarek Amer. He also said on Tuesday that removing caps on individuals would help the CBE increase Egypt’s foreign reserves to $25 billion by the end of 2016. He said “greatly contribute” to that goal. The CBE also held a meeting with foreign exchange bureaus in an effort to keep black market rates under control. Exchange bureau sources said the meeting resulted in putting a limit on the black market’s dollar value. “The agreement was not to exceed the 9.25 pounds to the dollar price on the parallel market in return for the central bank not interfering with exchange bureaus,” a source said. [Bloomberg, Reuters, 3/9/2016]
Senior Saudi prince says jobs are top priority
Saudi Arabia’s Prince Sultan bin Salman said Tuesday the kingdom has focused on job creation. The Prince said the fall in oil prices has prompted Saudi Arabia to rethink its economic and spending policies. “I think it’s good to go into a mode in Saudi where we begin to re-eye the economy,” he said. When oil prices were higher, he said, the government did not do enough to diversify the economy. “I have been in fact criticizing, if you like, the government’s funding of so many sectors that have not yet produced the jobs, so many sectors that have not really added value to the economy,” he said. The Prince, who heads the Saudi Commission for Tourism and National Heritage, said the kingdom’s tourism industry can create such jobs for Saudis. In an effort to provide more jobs to Saudi citizens, the Ministry of Labor also said Tuesday that it will ban foreign workers from the mobile phone industry. [AP, 3/8/2016]
Saudi Arabia seeks $6-8 billion bank loan
Saudi Arabia is seeking a bank loan of between $6 billion and $8 billion in what would be the first significant foreign borrowing by the Saudi government in over a decade. Riyadh has asked lenders to submit proposals to extend it a five-year US dollar loan, sources said. Last week, Saudi Arabia had asked banks to discuss the idea of an international loan, but details were not specified. London-based advisory firm Verus Partners, set up by former Citigroup bankers, is advising the Saudi government on the loan, sources said. The firm has sent requests for proposals to a small group of banks on behalf of the Saudi Ministry of Finance. [Reuters, 3/9/2016]
Oil exporters to meet this month to discuss freeze
The world’s largest oil exporters both in and outside the Organization of the Petroleum Exporting Countries (OPEC) plan to meet in Moscow on March 20 to discuss an output freeze, Iraq’s Deputy Oil Minister Fayadh al-Nema said. “[Iraq] is prepared to cooperate to discuss a plan to freeze production levels with the most prominent oil producers in the world and to guarantee that Russia and Saudi Arabia, the biggest oil producers and exporters, will sit at the negotiating table.” Russia’s Energy Ministry spokeswoman said Wednesday that no date has been set for a possible meeting between OPEC and non-OPEC nations. Russian Energy Minister Alexander Novak said last week that a meeting between OPEC and other leading oil producers could take place between March 20 and April 1, possibly in Russia, Vienna, or Doha. On Tuesday, Kuwait’s acting Oil Minister Anas al-Saleh said Kuwait will commit to a potential global oil production freeze if major oil producers join the pact. [Reuters, 3/9/2016]
Standard Chartered in talks on $2 billion Iraq bond sale
London-based Standard Chartered Plc is in talks with Iraq’s Finance Ministry to take part in a $2 billion bond sale this year. The bank is also holding talks with other government institutions about their financing needs, Chief Executive Officer in Iraq Andreas Meletiou said Tuesday. “We also want to partner with the [Iraqi] government in their efforts to rebuild Iraq and assist in the modernization of the banking sector,” Meletiou said. “We have been in discussions with the Ministry of Finance on its $2 billion bond issuance, anticipated to take place in 2016.” Meletiou said the bank’s main focus in Iraq is to serve international clients operating in the country’s power, water, oil, gas, telecoms, and infrastructure industries. [Bloomberg, 3/9/2016]
Also of interest
Saudi Aramco to double gas production in ten years | Reuters
Saudi Electricity refinances $1.14 billion loan for gas power plant | Reuters
Saudi job creation dries up as oil price slump hits broader economy | Reuters
Kuwait in talks with advisers over potential bond issue | Reuters
UK inquiry says oil revenue collapse means ISIS reliant on Gulf funds | The Guardian
National Bank of Egypt raises rates on dollar certificates of deposit | Reuters, DNE
As Egypt’s dollar crisis deepens, push to cut imports casts shadow over economy | Reuters
Thomas Cook extends Sharm al-Sheikh holiday cancellations to October | Reuters
Morocco’s Attijariwafa Bank plans bid for Barclays’ Egypt business | Reuters
Iraqi Kurdish oil pipeline could reopen soon | Reuters
Algeria’s Sonatrach to invest $3.2 billion in pipelines | Reuters