Remittances from UAE to Egypt come to a halt
Egyptian expatriates in the UAE are finding it difficult to remit funds to their homeland due to closure of country’s banks following anti-government protests.
UAE houses one of the largest population of Egyptian expatriates in the Gulf region. The UAE is the region’s third largest concentration of Egyptian expatriates, estimated at around 100,000 at the end of 2009. They remitted around $1.38 billion to Egypt during 2008-2009.
Egypt, racked by political unrest as demonstrators bid to end President Hosni Mubarak's 30-year rule, is heavily reliant on remittances from expatriates living in the UAE and other Gulf states.
"We couldn't make a single transfer to Egypt," Mohammed Al Ansari, chairman and managing director of the Al Ansari Exchange, was quoted as saying by Reuters. "On Sunday, we got a lot of interest but we cannot do anything for now. Usually, we have big volumes at the first of the month, when salaries are paid.”
Al Ansari, who said Egypt accounts for about 4 to 5 per cent of volumes at his firm, said he expected customers to switch to US dollars from Egyptian pounds once banks reopened. The Egyptian currency has hit six-year lows amid the unrest.
Banks will remain shut on Wednesday and the central bank said it is still assessing whether they will remain shut again on Thursday.
According to World Bank estimates, Egyptians remitted about $7.6 billion to their country in 2010.
"As soon as it will open, we expect big volumes, mostly for family needs, not even for investments. Seventy-five per cent of transfers were in Egyptian pounds because it was a stable currency. But we expect that to change."
Assistant Foreign Affairs Minister Mohamed Abdel Hakam said 70 per cent of the approximately six million Egyptians working abroad live in Gulf states although the lion's share of remittances came from US expatriates, who sent $2.2 billion last year.
Remittances from Kuwait came in second at $1.5 billion while Saudi-based Egyptians sent $1 billion.
"We haven't been sending money to Egypt for three days now," said a customer service agent at Kuwait's Muzaini Exchange.
More than a million Egyptian expatriates are thought to live in the Gulf, the lion's share in Saudi Arabia, where they rely on the stronger but autocratic Gulf economies to send home remittances worth billions of dollars.
"It's impossible, everything here is stopped," said Sayed, an employee at Al Fardan Exchange in Dubai which generates about 35 per cent of its business from Egyptian transfers.
"There are a lot of Egyptians in the Gulf and they can't send money.
(With inputs from Reuters)
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