Political turmoil in Egypt takes toll on its foreign reserves
Egyptian net foreign reserves dropped to $16.335 billion at the end of September, the central bank said on Wednesday. This marks a decrease by nearly $2 billion from $18.096 billion at the end of August.While the central bank did not cite any reasons behind the drop, tensions have been high in Egypt since President Mohammed Morsi was removed in July 2013, battling an insurgency that has recently gained pace.
Between March and April, Egypt received deposits worth a total $6 billion on April 22 from three oil- rich Gulf nations: Saudi Arabia, the United Arab Emirates and Kuwait, thereby increasing the available foreign reserves. These countries came to the aid of Egypt’s interim authorities, which removed the Muslim Brotherhood-affiliated former President Mohamed Mursi in 2013.
Egypt’s economy has been hit hard since a popular uprising toppled former President Hosni Mubarak in January 2011.
The political situation has taken its toll on the foreign reserves, which stood at almost $36 billion before 2011. While tension may have eased in recent months, there have been sporadic flare-ups often quelled with violence. the Iraq-originated Islamic State, or ISIS, this year, extended the sphere of their influence from Iraq and Syria to conflict-ridden Libya. There they have attacked foreigners and citizens, the most brazen of which were the assault on the Corinthian Hotel in Tripoli and the beheading of 21 Egyptian Christians in February. Also attacks mounted by Islamic State’s Egyptian affiliate, has killed hundreds of soldiers and police and has started to attack Western targets.
Last month Egyptian security forces mistakenly gunned down 12 Mexicans and Egyptians, leaving 10 injured.
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