Egypt appoints central bank caretaker chief amid crisis

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CAIRO (AP) — Egypt’s president on Thursday appointed a caretaker governor of the central bank, the president’s office said, a day after the bank’s chief resigned amid a grinding economic crisis triggered by Russia’s war on Ukraine.

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According to a statement, President Abdel Fattah el-Sissi named Hassan Abdullah to succeed Tarek Amer, who had held the post since 2015. The appointment still needs to be ratified by the state-controlled parliament, which is in recess until October.

In a meeting with the new appointee, el-Sissi stressed the importance of upgrading the country’s monetary policies to cope with global economic changes and to diversify Egypt’s sources of foreign currency, the statement also said.

Abduallah, 62, had worked as a banker for almost four decades in Egypt until he became the CEO of the Arab African International Bank in 2004. In May 2021, he was appointed the chairman of United Media Services, a state-controlled media conglomerate.

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On Wednesday, el-Sissi accepted Amer’s resignation and named the outgoing governor a presidential adviser. The president’s office offered no explanation for Amer’s resignation.

Amer had traditionally been seen as in the camp that supported the pound’s depreciation as a way to secure a new loan from the International Monetary Fund in order to address the growing budget deficit.

His resignation came after key ministries were reshuffled on Saturday, a Cabinet shake-up approved by parliament in an emergency session. A total of 13 ministries were affected, including health, education, culture, local development and irrigation. The country’s minister of tourism and antiquities also was replaced.

The Egyptian currency has slid to more than 19 Egyptian pounds to the dollar. That followed a central bank decision allowing the currency to depreciate by around 16% in March to try to stem a growing trade deficit.

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Russia’s war in Ukraine has been deeply felt in other ways in Egypt. The Arab world’s most populous country is also the world’s largest wheat importer that sources around 80% of it from the Black Sea region.

Following Russia’s invasion in late February, the price of wheat and other grains skyrocketed, as did the price of fuel. Although prices have come down somewhat, the cost of grains remains at least 50% higher than before the pandemic in early 2020. Furthermore, the cost of shipping to export those grains through the Black Sea is high.

Inflation in the country of 103 million people reached 14.6% in July, increasing pressure on lower-income households and everyday necessities. Around a third of Egyptians live in poverty, according to government figures.