Egypt bans gold exports, miner says not affected.
Mon Feb 28, 2011 6:06am GMT
( Source : Reuters )
An official from a gold mine in Egypt said he was confident it was not aimed at gold production but at individual exports.
A decree banning the export of gold in all its forms, including jewelry and ornaments, was issued by newly appointed Trade Minister Samir el-Sayyad. It takes effect immediately and continues until June 30, the official news agency MENA reported.
"This decision, which comes in light of the exceptional circumstances the country is passing through ..., is to preserve the country's wealth until the situation stabilises," MENA said.
The MENA statement made no mention of whether the ban included exports of gold from mining. But an official from the flagship Sukari gold mine of Centamin Egypt said he was confident the order did not affect the mine's operation.
"For Centamin this is not a problem ... I know 100 percent that this is not a problem for us," said Youssef el-Raghy, managing director for the Sukari gold mine, adding that the ruling appeared aimed at individuals taking gold out of Egypt not producers of gold like Centamin.
The Egyptian pound has come under pressure after some of the country's main sources of foreign currency, including tourism and foreign investment, collapsed after the protests that ousted President Hosni Mubarak erupted on January 25.
But bankers said the decision on gold exports seemed designed more to stop individuals from expatriating funds under the radar than to stem major capital outflows.
"It is most likely aimed at the big guys -- the top officials and businessmen who are under suspicion," said John Sfakianakis, a Riyadh-based economist with Bank Saudi Fransi. "They are blocking capital flight in a new asset class."
A banker in Cairo also said it seemed aimed at former officials or executives trying to smuggle gold or wealth out of the country.