ministry has put in place a package of measures to clear a backlog of goods
piled up in port, a ministry statement said on Tuesday 30 August.
A severe shortage
of foreign currency in Egypt over the last six months has sent banks and
importers scrambling to pay for the letters of credit needed to get their cargo
released from customs. Factories and retailers complain that production and
sales have been hurt due to a lack of inputs.
The foreign exchange crisis
was triggered by the Ukrainian war and interest rate hikes by the U.S. Federal
The package, to be
implemented “in the coming days”, is designed to help reduce commodity prices
paid by Egyptian citizens, Finance Minister Mohamed Maait said in the
One measures will
allow cargoes that have completed their customs procedures and are awaiting the
“Model 4” financing to leave ports within “the next few days”, the statement
Model 4 is a pledge issued by
commercial banks to pay the foreign exporter, according to a
2017 central bank directive. Banks over the last six months have often lacked
the foreign currency needed to issue the pledge. Fines imposed on importers and
investors for being late in completing customs procedures will also be
suspended if caused by a lack of documents from concerned authorities.
This measure will reduce the
financial burden on importers and discourage them from passing on higher prices
to consumers. In addition, shipping agents will be allowed to remove cargo from
customs zones and place it in outside warehouses provided they pledge not to
release it before they have received permission. This is to relieve investors
and importers from the additional cost of storing cargo inside port warehouses.