Egypt progresses toward Central Bank Digital Currency (CBDC) Implementation by 2030

Recent reports indicate that Egypt, a North African country, is actively advancing its Central Bank Digital Currency (CBDC) project with plans for a launch around 2030. According to sources from an Egyptian press, the CBDC, known as the e-pound, is envisioned as a strategic move by the Central Bank of Egypt (CBE) to enhance the competitiveness of the national currency and optimise monetary policy efficiency.

CBDCs, a form of digital currency issued by a country’s central bank, differ from cryptocurrencies in that their value is pegged to the country’s fiat currency and regulated by the central bank. Notable examples include Nigeria’s eNaira, launched in October 2021, which experienced modest growth and a measured reception among the country’s populace.

The introduction of Egypt’s digital pound is reported to be an integral part of the country’s broader digitalisation program for financial services. The Information and Decision Support Center of the Egyptian Council of Ministers has reportedly undertaken a research project titled ‘The Document on the Most Important Strategic Directions of the Egyptian Economy for the New Presidential Period (2024-2030).’ This project outlines economic and social policies for the Egyptian economy until 2030.

The digital pound, set for implementation by 2030, aims to augment the competitiveness of Egypt’s national currency and enhance the efficiency of monetary policy. This strategic move aligns with Egypt’s commitment to leveraging digital transformation opportunities to propel its financial sector forward and optimize monetary policy effectiveness.

As part of its objectives, the Egyptian government is targeting an increase in the number of digital financial wallets to approximately 80 million by 2030. This initiative is in line with the broader goal of fostering digital financial inclusion and expanding the adoption of digital financial services throughout the country.

Abdel Moneim al-Sayed, Director of the Cairo Center for Economic and Strategic Studies, emphasized the significance of the digital pound in response to the recent announcement by the Central Bank of Egypt. Al-Sayed noted that the digital pound would serve as the electronic counterpart to the traditional paper pound and would be transacted through electronic payment systems. This move underscores the government’s commitment to embracing digital transformation and reducing reliance on paper currency transactions.

The adoption of Central Bank Digital Currencies (CBDCs) in Africa has been relatively slow, with Nigeria being a notable pioneer in implementing its digital currency, the eNaira. Despite the challenges faced by Nigeria, Egypt is positioned to follow suit and introduce its CBDC. The outcomes of Nigeria’s venture into digital currency are observed closely by other nations, and as confidence grows, more countries may explore CBDC implementation.

It is crucial, however, to approach the launch of CBDCs with careful consideration of their inherent value and benefits, rather than merely for the sake of trendiness. As Egypt advances in its CBDC journey, thoughtful planning and strategic implementation will be essential for realising the potential advantages of a digital currency in the evolving global financial landscape.