Saudi Deposit Promotes Stability of Egypt’s Foreign Exchange Market

The Saudi move comes following the recent devaluation of the Egyptian pound. (Photo: AFP)
The Saudi move comes following the recent devaluation of the Egyptian pound. (Photo: AFP)
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Saudi Deposit Promotes Stability of Egypt’s Foreign Exchange Market

The Saudi move comes following the recent devaluation of the Egyptian pound. (Photo: AFP)
The Saudi move comes following the recent devaluation of the Egyptian pound. (Photo: AFP)

With Saudi Arabia’s announcement of a $5 billion deposit with the Central Bank of Egypt on Wednesday, sources told Asharq Al-Awsat that this move would enhance the stability of the foreign exchange market and consolidate the Egyptian economy amid severe pressure on the Egyptian pound.

In a statement published by the Saudi Press Agency (SPA), Riyadh said that the deposit comes as “an extension of the well-established historical ties and close bonds of cooperation between the Kingdom of Saudi Arabia and the sisterly Arab Republic of Egypt, and an affirmation of the depth of the deep-rooted relations.”

The SPA added that the Kingdom - in implementation of the directives of Custodian of the Two Holy Mosques King Salman bin Abdulaziz and Crown Prince Mohammed bin Salman - deposited $5 billion with the Central Bank of Egypt, confirming the distinguished bilateral ties at all levels.

Meanwhile, Egyptian Prime Minister Mostafa Madbouly held a meeting on Wednesday with Dr. Essam bin Saeed, Saudi Minister of State for Shura Council Affairs, and his accompanying delegation.

The Cabinet said in a statement that the governments of Egypt and Saudi Arabia had signed an agreement for the Saudi Public Investment Fund to invest in Egypt.

According to the statement, the agreement aims to encourage the Saudi PIF to invest in Egypt and contribute to achieving the country’s goals in attracting investments in foreign currencies. The total volume of trade exchange between Saudi Arabia and Egypt in 2020 exceeded about $5.5 billion, and rose to $7.5 billion this year.

Bin Saeed pointed to large investment opportunities that would be presented to the Egyptian market through Egypt’s sovereign fund or partnership with the private sector.

Observers told Asharq Al-Awsat that the Saudi move came following the recent devaluation of the Egyptian pound against the US dollar and other challenges, including fears of shortage and increasing prices of basic commodities, especially wheat and grain, as well as high oil prices that affect the state budget.



Saudi Council of Economic and Development Affairs Reviews Local, Global Economic Developments

The Saudi flag. Asharq Al-Awsat
The Saudi flag. Asharq Al-Awsat
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Saudi Council of Economic and Development Affairs Reviews Local, Global Economic Developments

The Saudi flag. Asharq Al-Awsat
The Saudi flag. Asharq Al-Awsat

The Saudi Council of Economic and Development Affairs has convened via video conference to review reports and agenda items, including a monthly update on local and global economic developments for October 2024.

The update provided an overview of the global economy, analyzed developments in major economies, identified key challenges, and assessed their potential impact on the national economy.

The council reviewed the Kingdom's significant strides in the cybersecurity sector. The nation's classification as a 'Role-modelling' in the UN Global Cybersecurity Index 2024 reflects the unwavering support of the wise leadership for the sector and in implementing Saudi Vision 2030's programs, it said.

The council also reviewed a report on the implementation of its decisions and recommendations from the third quarter of 2024. The report detailed the council's outputs. It highlighted a notable increase in entities achieving over 98% in performance indicators.

The council was briefed on the outcomes of the Saudi delegation's participation in the first Saudi-Brazilian Aviation Conference, including the signing of agreements and memoranda of cooperation that will further solidify the Kingdom's leading role in the aviation sector, aligning with the plans and strategies of Vision 2030.

The council discussed other topics and reports, including those related to the Local Content and Government Procurement Authority and the national program for leadership development.

It also reviewed the economic outlook report for the first quarter of 2024. It examined the executive summary of foreign trade for July, the summary of the wholesale price index report for August, and the summary of the consumer price index report for August.

It made necessary decisions and recommendations on these matters.