Raw materials and factors of production imported from abroad have been exempted by presidential order from new rules that require most Egyptian importers to use letters of credit (L/Cs), just weeks after the Central Bank of Egypt (CBE) introduced the rules.

Egypt imposed new rules requiring most importers to use L/Cs in March, despite fierce opposition from businesses (DC World News, 23 February 2022). Previously the rules allowed importers to buy on cash-against-documents terms that do not require traders to tie up their bank lines of credit.

Presidential order

"As per the president's directives, imports of production supplies and raw materials will be subject to the old system, which requires collection documents," according to a statement issued by presidential spokesman, Bassam Radi.

Egypt's President Abdel Fattah El Sisi issued the order following his meeting with the economic ministerial group to discuss measures for dealing with the international economic crisis the statement added.

Working group

In a move that appears to dilute the CBEs role in determining import rules, the president has also ordered the formation of a working group to monitor and evaluate import regulations.

It will be chaired by the prime minister and include the finance minister, trade and industry minister and representatives of other stakeholder bodies, as well as the CBE governor.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.