Egypt lifts limit on foreign currency transfers

Markets Associated Press

Egypt has lifted a $100,000 annual cap for foreign currency transfers abroad in a move that signals progress toward easing a dollar shortage and potentially strengthening investor confidence.

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The decision, announced Wednesday, applies to individual bank transactions.

Egypt set the cap in early 2011, after a popular uprising forced longtime autocrat Hosni Mubarak to step down. Years of unrest since then have crippled the local economy, including the vital tourism sector, and weakened the Egyptian pound.

Central Bank Governor Tarek Amer said in a statement that the move, which comes as part of an economic reform plan, would contribute to attracting foreign investment and increase dollar inflows.

Egypt floated its currency in November to meet a key demand from the International Monetary Fund, which provided Cairo with a $12 billion loan to support the government's reform program. Other austerity measures included lifting some fuel subsidies and imposing a value added tax.