Egypt's Central Bank excludes grain, beans from new import rules

The Central Bank of Egypt has excluded essential goods such as grain commodities and medicines from new import payment rules aimed at protecting local industry and reducing foreign currency spending, sources told Agricensus Thursday.

An amendment to the new rules, seen by Agricensus, excludes strategic and essential commodities such as wheat, corn, beans, poultry, and other goods such as tea, and meat from a list of imported goods to which the new payment rules apply, namely the insistance on letter of credit (LC) payment terms rather than cash against documents (CAD).

The grain market will therefore not be affected by the new rules.

"This way, there is no problem for our industry," a broker said. "They have excluded wheat, corn, oil, lentils, beans, milk powder, chemicals and medicine...It’s mainly for non-essential goods."

Earlier this week, Egypt's Central Bank changed the payment methods to be used when paying for imports.

This led to Egyptian trade industry lobbies to appeal to the government to revoke the hastily made decision, which they believed would drive up costs for Egyptian industry, have a negative impact on economic activity and cause a lot of difficulties for traders.

Wheat and corn imports were the biggest concern, as Egypt depends on them and most of the trade is done on CAD terms, apart from GASC tenders, where most of the contracts are paid via LC.