Egyptians walk past a poster depicting U.S. dollars and other currencies outside an exchange office in Cairo, Egypt, Thursday, Jan. 12, 2023. (AP Photo/Amr Nabil, File)
Egyptian President Abdel Fattah al-Sisi said on March 5 his country was in an economic "state of near-emergency" as a result of the Middle East war, warning of runaway inflation.
The Arab world's most populous nation has not been physically impacted by the U.S. and Israeli war with Iran.
But by the close of business on March 5, the Egyptian pound had fallen to an eight-month low against the U.S. dollar, trading at 50.2 to the dollar amid reports of short-term investment outflows.
Egypt's import-dependent economy has proven highly sensitive to fluctuations in the currency, which has lost two-thirds of its value since 2022.
At a military academy event, Sisi said "the current crisis might have some repercussions on prices,” warning that price-gouging traders could be tried "in military courts," according to a statement from his spokesman.
Over the weekend, Sisi had warned the war could spell trouble for the Suez Canal, the region's other vital waterway besides the Strait of Hormuz and a key source of foreign currency for Egypt.
Major shipping companies have already directed traffic away from the region, rerouting around the Cape of Good Hope off the tip of southern Africa.
