Remittances from expatriate Egyptians rise after pound float

Cairo: Remittances from expatriate Egyptians rose 11.8 per cent in the fourth quarter of 2016, the central bank said on Monday, with most of the increase coming after it floated the pound in a dramatic bid to unlock foreign currency inflows.
The central bank said in a statement remittances had risen 15.4 per cent to $1.6 billion in December 2016 from $1.4 billion in December 2015. Total remittances amounted to $4.6 billion in the fourth quarter of 2016, up from $4.1 billion in the same period of 2015.
Around 72 per cent, $3.3 billion, of fourth-quarter remittances were sent after the float, the bank added.
Egyptians working abroad send back billions of dollars a year in remittances, an important source of hard currency for a country that has seen tourism, foreign investment and exports dwindle in the political turmoil that followed the 2011 revolt.
The central bank floated the Egyptian pound on November 3, aiming to unlock foreign currency inflows and crush a black market for dollars that had discouraged people from channelling foreign currency through the banking system.
Expatriates had turned to the black market as the spread between the official pound to dollar exchange rate and the parallel rate widened.
The uptick in remittances suggests that the flotation, and subsequent steep depreciation in the pound, has succeeded in encouraging Egyptians to send more money home through the formal economy.