In a bid to bolster foreign currency reserves, Egypt is contemplating a collaborative initiative with the private sector to sell real estate units in US dollars to foreigners and expatriates, as per a statement released by the Cabinet on Thursday.
Prime Minister Mostafa Madbouly chaired an extensive meeting with top finance and housing officials to delve into this proposed real estate initiative. The potential benefits, including the initiative’s capacity to fortify the Egyptian Exchange’s performance and invigorate domestic real estate demand, were among the key points discussed during the session.
An agreement on the initiative’s terms was drafted, aiming to echo previous endeavors undertaken by the Egyptian government. Past initiatives, priory launched in 2022 and 2023, paved the way for foreigners to acquire real estate without constraints and facilitated duty-free importation of vehicles for expatriates.
Egypt’s pursuit of this real estate strategy comes amidst a severe US dollar liquidity crunch, with approximately USD 20 billion exiting the local market in search of higher interest rates offered elsewhere due to tightened monetary policies.
To counterbalance this exodus of funds, the government announced a comprehensive plan to generate USD 191 billion by 2026. This plan involves expanding the initial public offering (IPO) program progressively and introducing incentives such as tax exemptions and specialized licenses for foreign investors.
It is important to note that Egypt remains committed to fulfilling its obligations under a USD 12 billion loan program with the International Monetary Fund (IMF), with USD 3 billion as the first tranche of the loan, which has already been disbursed. This commitment includes adopting flexible regimes for exchange and interest rates, enhancing the private sector’s role in the economy, and accelerating IPO processes.