RPT - Egypt Hopes To Increase Gold Reserves With Abolition Of Customs Duties - Ministry Adviser

MOSCOW (UrduPoint News / Sputnik - 17th May, 2023) The cancellation of customs duties on gold for a period of six months announced by the Egyptian government has brought its price down, catering to Cairo's goal to replenish national gold reserves, Nagy Farag Baki, a gold supply adviser with the Egyptian Ministry of Supply and Internal Trade, told Sputnik.

The temporary tax exemption for gold was adopted by the Egyptian parliament and approved by the cabinet last week, waiving the 5% customs duty in addition to 14% VAT.

"The announcement alone of the abolition of customs duties on the import of gold from abroad contributed to a decrease in its price by 300 Egyptian Pounds ($10)... � from 2,650 pounds to 2,350 pounds per gram of the most common 21-karat gold," Farag Baki said.

He believes that the price of gold was likely to fall by another 50 pounds, after which it might either fall further or begin to rise, depending on the situation on the world market.

The official said that the temporary tax exemption applied to gold of all forms � jewelry, coins and ingots � and all places of origin, as "foreign gold has no nationality." Cairo's goal is to attract solid Currency, given that the "unjustified and serious increase in gold prices in the previous period was caused by an increase in demand with a small amount of strategic gold reserves in Egypt," with foreign imports suspended since 2022, he said.

Gold has been in a rally since November 2022. The revival of growth was facilitated by noticeable purchases of the precious metal by the central banks around the world, which wanted to balance their dependence on the US Dollar. Demand for gold by the banking sector in 2022 was a record for the entire history of observations and amounted to 1,136 tonnes.