EconSource: Egypt’s Central Bank Governor Says Pound Depreciation Not Worrying

Egyptian Central Bank Governor Hisham Ramez sought to calm local market nerves on Sunday following a surprise 2.5 percent weakening of the Egyptian pound against the US dollar. The central bank allowed the currency to depreciate by 20 piasters in its official foreign exchange auctions on Thursday and Sunday, driving it to its lowest level against the dollar since auctions began in 2012. However, in a television interview on Sunday, Ramez said the pound’s fall should not alarm anyone. The central bank set a cutoff rate of 7.73 Egyptian pounds per dollar in an auction that sold $39.6 million on Sunday, compared to a previous low of 7.63 on Thursday. Before that, the pound had held at 7.53 since February. [Reuters, 7/6/2015]

Egypt debt to foreign oil companies at $3.5 billion
Egypt’s debts to foreign oil companies stood at $3.5 billion dollars at the end of June, a 6.1 percent increase from March, an official at state-owned Egyptian General Petroleum Corporation (EGPC) said on Sunday. The country’s payments to oil and gas companies have been delayed by economic instability since 2011. Egypt’s oil ministry said in March that it aimed to fully repay its debts to energy companies by mid-2016, about a year later than previously indicated. [Reuters, 7/5/2015]

Iraq, Kurdistan oil deal close to collapse
An oil-sales deal between Iraq and the semiautonomous Kurdistan Regional Government (KRG) is close to collapse about six months after it was signed, as Iraq struggles to fight the Islamic State (ISIS or ISIL) and contain an escalating financial crisis. Months of acrimony between Baghdad and Erbil came to a head in June when the KRG reduced the amount of oil it sold through Iraq’s state-owned Oil Marketing Company (SOMO) and began ramping up its independent sales of oil through the Turkish port at Ceyhan. The situation underscores the uncertainty surrounding Iraq’s oil industry as it pumps record amounts of crude. With oil trading at prices 45 percent below last year’s highs, Iraq’s government coffers rely on its ability to fight for buyers in the export market with rivals like Saudi Arabia and Kuwait. [Wall Street Journal, 7/3/2015]

Saudi June non-oil business growth at record low
An indicator of growth in Saudi Arabia’s non-oil industries fell in June to the lowest level in six years as the biggest Arab economy loses momentum. The Emirates NBD Purchasing Managers’ Index (PMI) dropped to 56.1 from 57 in May, driven by a weak increase in new orders and slower output growth, the Dubai-based bank said in a report released Sunday. The index remained well above the 50-point mark that separates growth from contraction. The same measure for the United Arab Emirates (UAE) fell to 54.7 in June, the lowest in 22 months. Saudi Arabia’s PMI index has dropped in four of the first six months this year as the world’s biggest oil exporter grapples with the plunge in crude prices. [Reuters, Bloomberg, 7/5/2015]

Tunisia’s trade deficit drops 8.9 percent in first half of 2015
Tunisia’s trade deficit decreased 8.9 percent in the first half of 2015, about 596 million Tunisian dinars (MTD). The country’s deficit had increased 21.1 percent in the same period in 2014. Special Adviser to the Ministry of Trade Lotfi Khedhir told Tunis Afrique Presse that this decline in the deficit is the most significant since 1993. [TAP/All Africa, 7/5/2015]

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