Arab Finance: The Egyptian authorities have agreed to stop borrowing billions of dollars directly from the Central Bank of Egypt (CBE), bypassing the finance ministry, Reuters reported, citing a staff report prepared by the International Monetary Fund (IMF) for a board meeting in March.

"The authorities are committed to prohibiting new development lending to public agencies excluding the ministry of finance," the report read.

As of February 23^rd, the CBE had lent up to EGP 765 billion to state bodies other than the finance ministry, violating the banking law of 2020, it added.

This kind of borrowing could drag the economy down by increasing the money supply, which would trigger inflation and led to weaker currency exchange rate, economists said, as reported by the news outlet.

The CBE has not yet disclosed which agencies financed the borrowing, the report revealed, adding that around EGP 104 billion had been repaid, and the agencies were making regular interest payments on outstanding loans.

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