(AFP Photo)
Importers commented on the recent decision of Central Bank of Egypt (CBE), reducing commissions of opening letters of credit from 2.5% to 1.5%.
The importers said the decision, which was announced by Minister of Industry and Foreign Trade Mounir Fakhry Abdel Nour, is positive but the availability of the dollar is more important.
Egyptian importers are facing shortage in the dollar needed to discharge their imports, which resulted in hampering a big number of containers in ports. Some importers estimated the value of shipments to be at $1bn because of the inability of importers to pay the fees of transport in addition to the incoming shipments.
Abdel Nour declared that reducing commission comes within the mechanisms the government settled in order to guarantee availability of food commodities during the month of Ramadan. The announcement came on Thursday, during “Eshtaghal” exhibition, organised by Egyptian Junior Business Association (EJB).
Abdel Nour added that he met with the Governor of the CBE and minister of supply where they stressed on the necessity of giving food commodities the priority in opening bank credits, especially for meat, dairies, oils, legumes and grain products.
He mentioned that he found positive response from Governor of CBE, which guarantees the availability of these products during Ramadan at convenient prices.
“The decision of reducing commissions of letters of credits of importers in banks is positive, but it is not enough; what is more important now is providing the dollar to meet importers’ needs and facilitate their works,” said Ahmed Shiha, Chief of Importers Division at Chamber of Commerce.
Shiha added: “Importing in Egypt is going through a stumble and is suffering from dollar shortage; solving the crisis will not be achieved except through increasing dollar supply and eliminating the long queues demanding dollar, in banks, in order to discharge their imports.”
Hamdy El-Naggar, representative for the General Division of Importers at the Federation of Egyptian Chambers of Commerce (FEDCOC), said importers are currently facing some issues. The most significant of these, he said, is the difficulty of opening letters of credit.
Egypt’s bill of imports amounts to $60bn annually, distributed between wheat, oil, gas, food items, dairies, meats, and many other commodities and products. The government seeks to reduce these in order to decrease the budget deficit through activating the local industry.
El-Naggar said imports are at a complete standstill, and are affected by the shortage in dollar supply, adding that banks have to quickly provide the currency. He concluded that it is a positive point, but they demand that banks quickly manage needs of importers.
