CAIRO - As Egypt writes its new constitution, commentators are
keeping a close watch on legislation that will safeguard
individual religious and political freedoms -- concerns that are
of course crucial to the country's future. But an important if
less obvious factor in the future welfare of Egyptians will be
the role of the Central Bank of Egypt. The CBE as we know it
today was granted the status of an autonomous institution in
1961 in the era of the United Arab Republic. Like other central
banks, it performs a range of activities, the main ones being
lending to commercial banks, stabilizing the national currency
and setting the short-term interest rate. It is clear that the
policies of the CBE must take into account a host of factors
such as the amount of foreign aid received by the country, as
well as the monetary policies pursued by sister central banks
(especially those of Egypt’s main trading partners.)
Furthermore, the CBE must harmonize its policies with the
government’s economic policy objectives. Th