(MENAFN - Arab Times) The Central Bank of Egypt says the country's foreign currency reserves stand at 15.014 billion, enough to cover just three months' worth of imports.
The central bank said last month that current reserve levels represent a "critical minimum." Reserves were down slightly, 26 million, from November, according to the bank's website on Sunday.
The nation's foreign currency reserves have dropped by more than half from 36 billion before the January 2011 uprising. The main factors are significant cuts in foreign investments and tourism.
Egypt foreign reserves edged down to 15.015 billion at end of December from 15.036 billion at the end of November despite a currency crisis, the central bank said on Sunday.
The central bank implemented a new regime for buying ans selling foreign currency of auctions and currency controls last week after saying foreign reserves had fallen to a critical level. It sold 150 million on the final two days of December.
Earlier in December the finance minister said Qatar had deposited a loan of 500 million with Egypt's central bank as budgetary support.
Auctions
The Egyptian central bank reduced the total of US dollars it is offering on Sunday in a new system of daily currency auctions designed to stave off a financial crisis triggered by a rush to buy foreign currencies.
Political turmoil over the last month led many investors and private citizens to dump Egyptian pounds, pushing the country's foreign reserves to a precariously low level and prompting the central bank to introduce a system of daily auctions and currency controls.
The central bank had sold 75 million in each of its four auctions since the system was put in place on Dec 30, but on Sunday it is only offering 60 million.
"It means that the central bank wants other banks to begin making a market in foreign currency," said a Cairo-based analyst.
"The goal is a normally functioning interbank FX market in which the CBE does not need to intervene. By offering less FX, the central bank is encouraging banks to buy and sell FX to each other."
The Egyptian pound has weakened by about 3.7 percent on the interbank market since the new system was introduced on Dec 30. Foreign reserves stood at 15 billion at the end of November, less than three months of import cover.
The central bank is expected to release figures for December this week.
Meanwhile, Egypt's President Mohamed Morsi reshuffled his cabinet on Sunday, reports said, in the face of an economic crisis and ahead of fresh talks with the International Monetary Fund for a 4.8-billion loan.
Ten new ministers were sworn in, including Finance Minister Al-Morsi al-Sayyed Hegazi, whose predecessor Mumtaz al-Said headed the IMF loan negotiations which stalled during political unrest in December.
Hegazi, a specialist in Islamic finance, will report to Prime Minister Hisham Qandil, who remains in his post.
The Muslim Brotherhood, which backed Morsi for the presidency, had criticised Said as being too close to the army, which held power during the transition after the overthrow of president Hosni Mubarak in 2011.
Mohammed Ibrahim, a former police general, replaced Ahmed Gamal al-Din as interior minister, and eight other portfolios - all related to the economy - changed hands.
Ibrahim had been one of Gamal al-Din's deputies in charge of prison administration.
The ministers for transport, electricity, domestic development, civil aviation, the environment, communications, supply and domestic trade, and parliamentary affairs were all replaced.
Morsi announced the reshuffle on Dec 26, after the ratification by popular vote of a controversial new constitution drafted by an Islamist-dominated panel allied to the president. He said he wanted a cabinet more suited to the economic crisis the country faces.
Egypt's loan request to the IMF, made last August, was suspended for a month on December 11, with Cairo saying the postponement was "because of the political situation in the country."
The IMF and Egyptian authorities had reached a provisional agreement on Nov 20 on the 22-month loan - aimed at helping the government bridge financial shortfalls through fiscal 2013-2014.
A top IMF official will visit Cairo on Monday for fresh talks expected to focus on the loan.
The trip by Masood Ahmed, director of the IMF's Middle East and Central Asia department, comes at the invitation of Egyptian authorities, the Washington-based lender said on Saturday.
Discussions will focus on "the most recent economic developments, their policy plans for addressing Egypt's economic and financial challenges, and possible IMF support for Egypt in facing these challenges," the Fund said.
Egypt is reported to have extensively used its foreign currency reserves to support the pound and to ensure vital imports such as wheat and fuel.
Egypt's central bank acknowledged on Saturday that its foreign currency reserves, which fell to 15 billion from 36 billion in two years, were at a "critical minimum".
The Egyptian economy has been facing serious economic repercussions from the upheaval since Mubarak's overthrow in February 2011, particularly a decline in tourism receipts and a collapse in foreign investment
The Egyptian pound fell to its lowest level since 2004 of 6.42 against the dollar early last week before rallying slightly to 6.40.
Egypt is committed to completing negotiations with the International Monetary Fund to secure a 4.8 billion loan, its new finance minister said on Sunday, a day before an IMF visit to discuss a deal vital to the country's economy.
A senior IMF official is due in Cairo on Monday to meet Egyptian leaders over the deal, which was postponed last month to give Egypt more time to defuse political tensions before introducing unpopular austerity measures.
Cabinet sources said on Saturday that President Mohamed Morsi had fired his finance and interior ministers after promising a government reshuffle to assuage public anger at an economic crisis.
New finance minister Al-Morsi Al-Sayed Hegazy, who was be sworn in by Morsi on Sunday, told journalists he was "completely ready to complete discussions with the International Monetary Fund".
Hegazy, who made his remarks after meeting Prime Minister Hisham Kandil, is a little-known economist based at Alexandria University and a specialist in Islamic finance.
He is not a member of Morsi's Muslim Brotherhood, though Egyptian media described him as close to the group.
State news agency MENA said a total of 10 new ministers would be sworn in on Sunday for portfolios including electricity, environment, communications and transport.
