Established black market for foreign exchange, when the Government intervenes in the market exchange rate and its currency has a price higher than market price, in other words, you set the ceiling price of foreign currencies against the local currency (see the form of arrest of the currency rate). Assumed that the forces of supply and demand equal, when the exchange rate of the local currency against the U.S. dollar amount equal to So and Mo. Assumed that the government set the exchange rate to be S, which is less than So, ie the local currency has become more expensive than the price, which tie him to supply and demand. This, in turn, lead to the creation of the request is higher than the supply, provided by the government of the U.S. dollar, which is the emergence of a black market for that currency, where the evaluation of the U.S. dollar higher than the Government's assessment, and the difference between the price the government and the black market rate is the S - So.
By pursuing policies of economic reform in Egypt, I found a black market for everything, almost, under the control of the government. Perhaps the most prominent of these forms is the black market for foreign exchange, which included a large number of dealers, who were deployed throughout all Egypt, as they deal with all kinds of foreign currencies, particularly the U.S. dollar. It was the black market for foreign exchange activities of the largest in Egypt, as well as the most profitable. More than that, despite the illegal character of the market, they have been working under reasonable conditions, in terms of degree of security surrounding the dealers in the market, because of the low degree of control, as well as the difficulty in monitoring such transactions illegal by the authorities. Have begun to criticize the black market for foreign policy in the wake of the adoption of controls on foreign exchange, after the Second World War. We have represented major urban areas, as well as areas of the main attractions at the outset, the main centers where there are dealers, foreign currency on the black market for foreign exchange in Egypt. However, by the mid-seventies, the large-scale migration to the Arab oil states, which included immigrants from all regions of Egypt, and from different ages, and levels of professional and functional. We have taken these migrants pumping huge amounts of foreign exchange in all geographic regions, leading to a widening of the market significantly.
In response to this growth in the volume of transactions on the black market for foreign exchange, the Government has taken a series of actions are:
1. The abolition of the freedom of possession, dealing in foreign exchange.
2. Increase the penalties for dealing in black market.
3. The use of appropriate economic policy instruments to reduce foreign exchange dealing.
In 1968, there have been some shifts in economic policy, in terms of allowing individuals and business needs to import from abroad, within certain limits by using their own foreign exchange, without a commitment by the government to provide foreign exchange for the import process, which has subsequently , the system of import without currency conversion. When the States adopted a policy of economic openness, have been restored the right of possession and dealing in foreign exchange, the banks allowed through it. In 1973, construction of a parallel market for foreign exchange, to attract remittances of Egyptians working abroad, as well as direct tourism expenditure towards the official channels of foreign exchange, through the granting of such a transaction incentive exchange rates, through the addition of an incentive in addition to the official exchange rate. However, the process of managing the exchange rate on the parallel market for foreign exchange, and following the same pattern of management of the official exchange rate in the past; and therefore failed to mobilize the black market in foreign exchange resources available to the Egyptians working abroad, and also failed to attract tourists to use the formal market, in conversion of their foreign exchange. The rate of exchange at the parallel market, almost constant, and failed to match the movements of the exchange rate on the black market. If we look at the sources of supply of foreign exchange in the black market, we find that the spending of tourists was the main source of foreign exchange resources in the black market, in response to the differences between the official exchange rates and the rate of exchange on the black market. Has also accounted for counterfeiting bills of foreign trade, whether through the overvaluation of the value of imports, or through Iboukhas imports, exports show no less than its true value, a steady source of foreign exchange inflows on the black market, if we exclude the period of the sixties, decreasing the importance of this source; because of the government monopoly of foreign trade in this period. However, with the adoption of a policy of economic openness, the government to loosen the monopoly of foreign trade transactions in sequence, leading to the return of counterfeiting operations more than ever. To become the most important problems faced by the control of exports and imports. Since the mid-seventies, the remittances of Egyptians working abroad, the most important sources of foreign exchange, which is estimated at about 30 billion pounds annually, the flow of which only 10% on average, through the official channels. As for the rest of it found its way to the black market for foreign exchange. However, with the adoption of economic reform policies, in particular, with regard to the rate of foreign exchange and interest rates on the Egyptian pound, the remittances of Egyptians working abroad have been increasing, reaching 11 billion pounds.
With regard to sources of demand for foreign currency on the black market, the main source of demand is the financing of the commodity importation from abroad, both for the financing of smuggling the commodity, or what was previously known as the luggage trade, or for the financing of the import, without a currency conversion. According to the import regime, without the transfer of currency, the granting of import licenses to importers, who can demonstrate that they have sufficient quantities of foreign exchange, without accountability for the sources of these funds.
There is no doubt that the financing of the drug trade, are essentially based on the black market for foreign exchange. Also, there is strong demand for foreign exchange by individuals, who wish to buy financial assets denominated in foreign currencies, where the increased demand for foreign exchange; for the purpose of investment in portfolio securities, in the periods in which interest rates on the Egyptian pound fixed and negative in real terms, as a strategy to diversify financial risk to investors Egyptians. Similarly, the demand for foreign exchange; for the purpose of smuggling of funds, has increased clearly in the wake of the opening, estimated at 500 million dollars annually.
By pursuing policies of economic reform in Egypt, I found a black market for everything, almost, under the control of the government. Perhaps the most prominent of these forms is the black market for foreign exchange, which included a large number of dealers, who were deployed throughout all Egypt, as they deal with all kinds of foreign currencies, particularly the U.S. dollar. It was the black market for foreign exchange activities of the largest in Egypt, as well as the most profitable. More than that, despite the illegal character of the market, they have been working under reasonable conditions, in terms of degree of security surrounding the dealers in the market, because of the low degree of control, as well as the difficulty in monitoring such transactions illegal by the authorities. Have begun to criticize the black market for foreign policy in the wake of the adoption of controls on foreign exchange, after the Second World War. We have represented major urban areas, as well as areas of the main attractions at the outset, the main centers where there are dealers, foreign currency on the black market for foreign exchange in Egypt. However, by the mid-seventies, the large-scale migration to the Arab oil states, which included immigrants from all regions of Egypt, and from different ages, and levels of professional and functional. We have taken these migrants pumping huge amounts of foreign exchange in all geographic regions, leading to a widening of the market significantly.
In response to this growth in the volume of transactions on the black market for foreign exchange, the Government has taken a series of actions are:
1. The abolition of the freedom of possession, dealing in foreign exchange.
2. Increase the penalties for dealing in black market.
3. The use of appropriate economic policy instruments to reduce foreign exchange dealing.
In 1968, there have been some shifts in economic policy, in terms of allowing individuals and business needs to import from abroad, within certain limits by using their own foreign exchange, without a commitment by the government to provide foreign exchange for the import process, which has subsequently , the system of import without currency conversion. When the States adopted a policy of economic openness, have been restored the right of possession and dealing in foreign exchange, the banks allowed through it. In 1973, construction of a parallel market for foreign exchange, to attract remittances of Egyptians working abroad, as well as direct tourism expenditure towards the official channels of foreign exchange, through the granting of such a transaction incentive exchange rates, through the addition of an incentive in addition to the official exchange rate. However, the process of managing the exchange rate on the parallel market for foreign exchange, and following the same pattern of management of the official exchange rate in the past; and therefore failed to mobilize the black market in foreign exchange resources available to the Egyptians working abroad, and also failed to attract tourists to use the formal market, in conversion of their foreign exchange. The rate of exchange at the parallel market, almost constant, and failed to match the movements of the exchange rate on the black market. If we look at the sources of supply of foreign exchange in the black market, we find that the spending of tourists was the main source of foreign exchange resources in the black market, in response to the differences between the official exchange rates and the rate of exchange on the black market. Has also accounted for counterfeiting bills of foreign trade, whether through the overvaluation of the value of imports, or through Iboukhas imports, exports show no less than its true value, a steady source of foreign exchange inflows on the black market, if we exclude the period of the sixties, decreasing the importance of this source; because of the government monopoly of foreign trade in this period. However, with the adoption of a policy of economic openness, the government to loosen the monopoly of foreign trade transactions in sequence, leading to the return of counterfeiting operations more than ever. To become the most important problems faced by the control of exports and imports. Since the mid-seventies, the remittances of Egyptians working abroad, the most important sources of foreign exchange, which is estimated at about 30 billion pounds annually, the flow of which only 10% on average, through the official channels. As for the rest of it found its way to the black market for foreign exchange. However, with the adoption of economic reform policies, in particular, with regard to the rate of foreign exchange and interest rates on the Egyptian pound, the remittances of Egyptians working abroad have been increasing, reaching 11 billion pounds.
With regard to sources of demand for foreign currency on the black market, the main source of demand is the financing of the commodity importation from abroad, both for the financing of smuggling the commodity, or what was previously known as the luggage trade, or for the financing of the import, without a currency conversion. According to the import regime, without the transfer of currency, the granting of import licenses to importers, who can demonstrate that they have sufficient quantities of foreign exchange, without accountability for the sources of these funds.
There is no doubt that the financing of the drug trade, are essentially based on the black market for foreign exchange. Also, there is strong demand for foreign exchange by individuals, who wish to buy financial assets denominated in foreign currencies, where the increased demand for foreign exchange; for the purpose of investment in portfolio securities, in the periods in which interest rates on the Egyptian pound fixed and negative in real terms, as a strategy to diversify financial risk to investors Egyptians. Similarly, the demand for foreign exchange; for the purpose of smuggling of funds, has increased clearly in the wake of the opening, estimated at 500 million dollars annually.
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