Support the Egyptian economy THE CENTRAL Bank of Egypt announced this week it has created an account under the name of "Contributions to support the Egyptian economy", to accept deposits and donations from citizens for the purpose of supporting the Egyptian economy in the aftermath of the revolution. The number of the account is 2512011 as of the date of the revolution. Aziz El-Jebali, Cairo branch manager in the Central Bank of Egypt (CBE), told Al-Ahram Weekly that the management of the Central Bank has created that account to accept deposits and contributions of citizens and legal persons without a minimum or maximum limit to the donations. The account will be accepting Egyptian pound as well as foreign currency donations. El-Jebali added that the contributions to this account are not limited to a certain period. He said that donors can donate from any bank across the country which will in turn deposit these donations in the specified account at the CBE without collecting any fees or extra charges on the value of the donations. He said that as soon as the account was opened, it received large amounts of donations and he expects more as many Egyptians want to share in the rehabilitation of the economy. These donations will be at the disposal of the Egyptian government. Telecommunications win EGYPT'S current political instability has had a positive effect on the telecommunications market, a recent report published by Pyramid Research (PR) says. "Telecommunications use increased heavily during the recent political turmoil, driven mainly by its role in gathering the masses that led to toppling Hosni Mubarak's regime," says Hossam Barhoush, senior analyst at PR. The Egyptian telecommunications market generated $6.4 billion in service revenues in 2010, and is expected to grow at 4.2 per cent compound annual growth rate by the year 2015, Barhoush stated in the report. The largest contributor to the total revenue, according to the report, is mobile voice with $4.2 billion, followed by fixed voice which has generated $1.1 billion. The cellular phone sector remains the most lucrative and revenue generating front in the market with mobile revenue share at 77 per cent, says Barhoush, adding that mobile penetration rate of only 60 per cent makes Egypt yet far from its peak of user penetration. Barhoush also declared that the upcoming presidential elections in September 2011 will hopefully bring to power a strong government willing to implement economic and policy reforms, which would eventually lead the telecommunications market to liberalisation, increased competition and strong growth. Imminent bourse reopening EGYPTIAN minister of finance, Samir Radwan, asked businessmen to join efforts with the government to reach better economic developments in the coming period. Radwan stressed on the importance of the private sector's role in pushing economic developments forward, saying all Egyptians should work together during this tough time Egypt is going through. The minister also said during a conference organised by the American Chamber of Commerce (AmCham) on Tuesday that he is looking into allocating more money for subsidising basic foods in order to prevent an expected increase any time soon. Moreover, Radwan declared that he hopes the stock exchange market would open next week, and that the Ministry of Finance is trying to allocate more money for the bourse aside from the LE250 million already given out to support small investors and brokerage companies. "It is dangerous to approach 28 March without reopening the stock market," said Radwan, fearing the market being excluded from the MSCI's index which is prepared by Morgan Stanley to track the emerging markets. The minister expressed his refusal to factional demonstrations that swept the country, saying all the demands will be met but not at once. Weekly repos STARTING Tuesday 22 March, the Central Bank of Egypt (CBE) will launch weekly repurchase agreements (repos) in the money market as a means to stabilise the market amid the political and economic turmoil that Egypt is currently facing. Repos are a way for central banks to lend funds into the market in exchange for temporary custody of securities. The party that buys the securities effectively acts as a lender. The seller acts as a borrower, using the security as a collateral for a secured cash loan at a fixed rate. Through those weekly purchasing agreements, the central bank will buy securities at an interest rate of 9.25 per cent. "Market liquidity conditions have come under pressure and in order to ensure that the prevailing short- term market rates are consistent with the MPC's (Monetary Policy Committee) policy rate, the CBE has decided to introduce repos," said the Central bank on its website. The bank did not elaborate on what securities it would accept in its repo operations, but market observers believe it would be treasury bills.
