CAIRO, April 14 Egypt's central bank will hold
an exceptional foreign exchange auction for $600 million on
Sunday to cover strategic imports such as wheat, meat and
cooking oil, it said in a statement.
The auction is 15 times the size of the three $40 million
currency auctions the cash-strapped central bank has been
holding weekly in recent months.
The most populous Arab nation is grappling with an economic
crisis caused by more than two years of political instability.
Egypt's foreign currency reserves are at critically low levels
and the government is struggling with an unaffordable deficit.
Shortages of imported fuel are disrupting transport and
causing power cuts in the country of 84 million. The situation
is expected to worsen as summer approaches and Egyptians switch
on their air conditioning.
The world's biggest importer of wheat, Egypt has cut back on
international purchases this year in the hope of a bumper local
Sunday's auction was held for banks with clients importing
staple commodities such as wheat, cooking oil, tea, meat, fish,
beans, butter, corn and baby milk, components for drugs and
vaccines as well as spare parts, the statement said.
"Banks are required to apply with the amounts of their
client's outstanding import needs," it said.
The central bank auction coincides with the start of the
wheat harvest for which farmers urgently need fuel supplies to
run harvesters and transport the crop to storage centres.
The results of future special auctions would be announced on
the central bank website, it said, without saying when. It
extended the bidding time for Sunday's auction until 1230 GMT.
In a boost to Egypt's finances, Qatar this week agreed to
buy $3 billion in government bonds and to supply natural gas in
the summer when it is needed. Libya also agreed to deposit $2
billion with the Egyptian central bank.
The government is also in talks with the International
Monetary Fund on a $4.8 billion loan deal that would unlock
billions more in international support.