Egyptian lawmakers recently welcomed parliament’s approval of an agreement allowing the country to join the New Development Bank, according to a report. According to the report, the lawmakers believe that joining the BRICS-backed institution will allow Egypt to reduce its demand for dollars and maintain its foreign exchange reserves.
Joining the BRICS
Following the Egyptian parliament’s approval of an agreement to join the New Development Bank, Mohamed Abdel Hamid, a member of parliament, reportedly said that the move would help reduce demand for U.S. dollars. The New Development Bank was created by the BRICS nations of Brazil, Russia, India, China, and South Africa and aims to support “public or private projects through loans, guarantees, equity participation, and other financial instruments.”
Abdel Hamid, vice chairman of the council’s economic committee, said that in addition to helping Egypt maintain its foreign exchange reserves, joining the institution will allow it to receive the bank’s support in areas such as health, infrastructure, and telecommunications.
“Egypt’s membership in the New Development Bank of the BRICS group will also relieve the national budget from pressure to find US dollars to meet the country’s imports, as members of the bank can use their own currency for trade,” the lawmaker reportedly said.
The Economic TimesreportsEgypt recently won a bailout package from the International Monetary Fund (IMF), becoming the third country to express interest in joining the group of five major emerging economies known as BRICS.
diminishing the dollar’s dominance
Meanwhile, Abdel Hamid shared the same view of Egypt’s prospects after joining the BRICS, as did another lawmaker, Marbat Mattar. In his remarks following the approval of the agreement, Mattar positioned BRICS as an institution that would also help weaken the dollar’s dominance.
“The BRICS group is an important forum that can move the international economy away from American domination and the US dollar,” Mattar reportedly said.
In support of her argument, Matar reportedly pointed to the war in Ukraine and the impact this will have on Egypt’s import bill.
Meanwhile, another lawmaker, Ahmed El Awadi, head of the parliamentary defense and national security committee, said the move would create new markets for Egyptian agricultural and industrial products.
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