Problems relating to Trade and Investment on Egypt

12. Exchange controls
Issue	Issue details	Requests	Reference

(1) Restricted Withdrawal of Foreign Currency and External Remittance

- GOE restricts withdrawal of foreign currency (USD20,000 maximum per day). In addition, external remittance is also subject to restrictions under the terms and conditions of individual banks.

- It is requested that GOE either repeals or deregulates the restrictions.

(2) Rigorous Foreign Exchange Control

- Due to the Central Bank's foreign exchange control, outflow of U.S. Dollars is restricted. It makes extremely difficult to settle in US$ with the domestic import firm, or to open letters of credit for imports.

- It is requested that GOE deregulates foreign exchange control to enable settlement in US$ freely.

(3) Radical Exchange Fluctuations Prevail

- As it stands, member firm's subsidiary (MFS) benefits from exchange gain on a direct export transaction in yen. Nevertheless, negotiation for raise in price is difficult. In a transaction with its parent company, the prevailing Yen depreciation enables MFS to offer special prices to its customers. However, MFS runs on a thin margin, so that if the exchange rate swings toward appreciation of Yen, it will instantly show operational loss: such is the severity of the fluctuation band.

- It is requested that GOE takes step to:
-- stablise foreign exchange fluctuations, and
-- holds the fluctuation band within a few percents in 6-months.

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