Economists have forecast that the Egyptian economy will recover once the security situation in Egypt returns to normal. “Restoring security and stability brings back confidence in the Egyptian economy,” said Hisham Ramez, vice president of the Commercial International Bank on Monday. “The economy is backed by the banking system, not driven by it.” Ramez, who was also deputy governor of the Central Bank for four years, predicted that foreign investment would return with political stability. Ramez said that the Central Bank took the right decisions during the uprising, namely keeping banks open despite the crisis, maintaining the exchange rate of the pound against the dollar so as to control the inflation rate, and allowing foreign investors to pull their capital safely from the market. “We lost US$16 billion in foreign investment during the global financial crisis of 2008,” he said. “But investment returned the next year, thanks to the Central Bank's management of the crisis at the time.” “The foreign reserves lost $18 billion after the revolution, or 50 percent,” he said. “But we can overcome the crisis, especially as the infrastructure is still in place efficiently, and the banking system can contribute to growth and development.” “Egypt's external debt is not more than 16 percent of the gross domestic product, most of which is long-term,” he added. “But although I am not against borrowing from the International Monetary Fund, I still see that Egypt needs to depend on its own resources.” For his part, Hisham Ezz al-Arab, chairman of Commercial International Bank, said that tourists are not concerned with the pound falling against the dollar. “They want security,” he said.
