CAIRO: Egypt's central bank on Tuesday tightened trade financing regulations to support local manufacturing and ease the ballooning trade deficit that has worsened an acute foreign exchange shortage.
Egypt, which depends on imports, has faced a decline in foreign currency receipts since a 2011 uprising against autocrat Hosni Mubarak scared off foreign investors and tourists.
Its forex reserves have more than halved to $16.4 billion, enough for just three months worth of imports.
Earlier this year the central bank attempted to put a stop to the foreign exchange crisis by restricting the amount of dollars a company could deposit in banks. But the measure caused imports to pile up at ports and has been widely criticized as a blunt instrument.
In a statement on Tuesday, the central bank said local banks would have to obtain import documents directly from foreign banks, instead of from the clients, as is the current practice.
In a separate statement, Egypt's customs authority said the move was aimed at preventing importers from manipulating receipts.
In addition, importers will have to provide 100 percent cash deposits on letters of credit for imports instead of the current 50 percent, the central bank said.
Medicine and food as well as manufacturing components and machinery are excluded from this rule.
Egyptian manufacturers have long complained that unscrupulous importers put artificially low values on customs bills to avoid duties. The practice, which merchants say is widespread, robs the government of tax revenues and makes it difficult for local produce to compete on price.
"They are just fine-tuning the present regulations amid the foreign currency shortage. This definitely could increase the pressure on importers," Beltone Financial economist Ziad Waleed told Reuters.
"The central bank is trying to use all available measures to try to limit imports and this could limit the import of luxury goods, but it is not the key to solving the foreign currency shortage," he said.
In 2014, Egypt imported goods worth $60.8 billion compared with exports worth $22.1 billion.
It was not clear if the new regulations announced on Tuesday were a prelude to lifting the deposit caps, which had made it difficult for companies to open letters of credit to pay for imports, which piled up at ports.
Goods were finally released in November after state banks supplied $1.8 billion to clear the backlog and process new letters of credit.
Egypt's central bank tightens import controls
Egypt's central bank tightens import controls
Saudi-French cooperation to localize veterinary vaccine manufacturing
RIYADH: In the presence of sector leaders, the National Livestock and Fisheries Development Program signed a memorandum of understanding with French company Ceva under the patronage of Minister of Environment, Water and Agriculture Abdulrahman bin Abdulmohsen Al-Fadhli, who also chairs the program’s board.
The agreement aims to localize vaccine manufacturing, transfer technology and technical expertise, and expand the industrial and commercial production of veterinary vaccines across the Kingdom.
According to the MoU, the two parties will work to achieve high efficiency in mass production scale-up and establish a clear path for sustainable commercial operation that meets the needs of the local and national market, as well as strengthen the biosecurity and food security system.
The MoU also includes the development and modernization of messenger RNA vaccine technologies, along with joint research and development of a Middle East Respiratory Syndrome vaccine for camels. This involves designing, evaluating, and developing vaccines specifically tailored to combat the virus.
The agreement also covers the development of a rabies vaccine and related solutions, as well as supporting national efforts to control the disease through vaccine provision, capacity building, and the implementation of integrated prevention strategies.
The collaboration between the program and Ceva aims to meet the needs of the poultry vaccine market in the Kingdom, currently estimated at around SR750 million ($199 million).
The company will work to cover approximately 30 percent of this market with an initial investment of around SR250 million.
With continued government support for poultry projects and increased production in the sector, the market is expected to grow at a rate exceeding 10 percent annually, reaching approximately SR1.25 billion by 2030.
The addition of the world’s leading poultry vaccine manufacturer to Biotech Park highlights the program’s key role in developing new industries within the livestock and fisheries sector.
It also highlights the program’s commitment to building international partnerships with global companies, organizations, research centers, and universities to support advanced biotechnology industries and attract high-quality investments. It also seeks to create new economic sectors based on biotechnology, enhance veterinary health security, and support the sustainable economic development of the livestock sector, as well as empower national and emerging companies and provide advanced research and industrial infrastructure.
This will solidify the Kingdom’s position as a global hub for biotechnology industries and the development of national capabilities.
Ceva is the first international partner to join Biotech Park, the future veterinary biotechnology city launched by the program in Dhurma Governorate. The city is the world’s first specialized and fully integrated hub for veterinary biotechnology, serving as a benchmark for sector development and a platform supporting markets across the Kingdom, the Gulf, the Middle East, Africa and beyond.
The signing of Ceva is a significant step, given its position as the world’s leading manufacturer of poultry vaccines and medicines, and one of the most prominent international companies in the field of biotechnology.
The MoU aims to localize the veterinary vaccine industry, ensuring its compatibility with the strains of poultry diseases prevalent in Saudi Arabia. This includes the transfer of technology and technical expertise from Ceva, along with the implementation of specialized training programs to guarantee that manufacturing facilities comply with international Good Manufacturing Practice standards.
