Central Bank maintains capital controls

The Central Bank of Egypt declared Tuesday that Egyptian banks could still only conduct money transfers of less than US$100,000 a year, maintaining current limits despite indications that controls would be loosened in the new year.

A letter sent from the Central Bank to other banks Tuesday maintained the limits imposed on capital transfers to prevent foreign currency from leaving the country in the wake of unrest following the removal of President Hosni Mubarak in early 2011.

At the beginning of December 2013, Deputy Prime Minister Ziad Bahaa Eddin said that the government would lift capital controls early in the new year.

Karim Helal, an analyst at ADIB Capital, also maintained that the Central Bank was considering extending the limit to $200,000, which he said would be a promising sign for the economy.

“I read it as a good sign, a message that things are getting back to normal. And whatever extraordinary circumstances the country was in are over,” he said.

Although increasing the limit could allow capital to leave Egypt more easily, Helal said he didn’t see any risk of capital flight.