Will Egypt float the pound post "Ras El Hekma" deal?

By Gamal Khattab February 27, 2024 1988

Egypt might be making some changes to its currency soon. People are talking about the possibility of the Egyptian pound being "floated" in the coming days. This basically means that the value of the currency could change compared to the US dollar. Some experts think this could help Egypt's economy by closing the gap between official and unofficial market prices.

The Big Deal

Last week, the Egyptian Prime Minister announced a huge investment project called "New Ras Al-Hikma." This project is expected to bring $35 billion for Egypt. It's part of Egypt's plan to develop its cities and attract more tourists. The United Arab Emirates (UAE) is also investing a lot of money in this project, which could help Egypt's economy grow.

What's the IMF Saying?

The International Monetary Fund (IMF) thinks the Ras El Hekma project is a good thing for Egypt's economy. They're having discussions with Egypt about how to improve economic stability and growth. The IMF believes that having a flexible exchange rate for the local currency is important for Egypt's economic reform.

Rising Prices and Inflation

Some people in Egypt are worried about rising prices, especially with Ramadan coming up. The government is working on providing enough foreign exchange to make sure essential goods like food and medicine are available. Experts think that the recent changes in the currency could affect prices in the short term, but things might stabilize in the long run.

Overall, Egypt is going through some changes with its currency and economy. It's important for everyone to keep an eye on how these changes will impact daily life and the country's future.