!_StoryDek_! Remittances fell 38% y-o-y during 1H 2023

Another argument in favor of a float: Remittances to Egypt are expected to see a 15% y-o-y drop this year to USD 24.2 bn, largely due to the major gap between the official and unofficial exchange rate pushing Egyptians abroad to send in their remittances through unofficial channels, according to a World Bank report (pdf). The bank initially saw remittances picking up for the year, penciling in a 3.1% increase in its June report.

This comes as no surprise: Money coming in from Egyptians abroad fell 38% y-o-y during the first half of the year to USD 10 bn, the report added.

Not helping our ongoing FX crunch: The shortage of hard currency has caused a wide gap between the official and black market exchange rates and pushed the Madbouly government to take a series of measures aimed at drumming hard currency.

We dragged down the entire region with us: The bank now sees remittance flows to the MENA dropping 5.3% y-o-y in 2023 to USD 61 bn, largely driven by Egypt's sharp drop in remittance flows. The report also pointed to the slowdown in remittances coming in from Saudi Arabia and the UAE for the decline, which it partially blames on “some correction from the pandemic-related distortions.”

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