Wed 12/March/2025 – 12:17 AM
The International Monetary Fund affirmed that the executive directors recognized the progress made by Egypt in achieving economic stability and rebuilding market confidence despite the difficult external environment.
According to a report issued by the Fund today, Wednesday, the executives acknowledged the improvement of economic activity and progress made in restoring foreign exchange reserves to adequate levels, but they indicated that the economic scene is still influenced by regional conflicts and trade turmoil in the Red Sea, while religion and total financing needs are high, and represent major financial challenges in the medium term.
The report pointed out that, in light of the variation of the performance of the programs, the managers called for intensifying the implementation and careful monitoring of the program’s obligations, noting the need for strong commitment and responsibility for structural reforms to create the conditions conducive to sustainable and comprehensive growth, and ensure that weaknesses reduce sustainable weaknesses while achieving the development and social goals of Egypt.
The International Monetary Fund acknowledges the improvement of the Egyptian economy and the restoration of foreign exchange reserves
Looking at the future, the managers emphasized that enhancing financial sustainability is a priority that requires effective mobilization of local revenues and allowing energy prices to reach cost recovery levels, a comprehensive debt management strategy, enhance financial control – especially on entities outside the budget, and accelerate the process of withdrawing investments.
The managers agreed that preserving a free foreign exchange system under a flexible exchange rate system is very important to avoid the accumulation of external imbalances, and they stressed the importance of maintaining the movements of the exchange rate in response to the offer and demand for foreign exchange, and they also considered that the presence of a strong system to target inflation, with an independent central bank and sound financial policies, is essential.
The directors urged Egypt to intensify its efforts in structural reform to enhance higher, more sustainable and comprehensive growth, based on creating job opportunities, stressed the need to take decisive measures to resume efforts to withdraw investments, decisively reduce the state’s imprint, and achieve equal opportunities, and these efforts will enable the private sector to become the main driver of growth.
The managers pointed out that the implementation of extremely important climate reforms for the macroeconomic, in conjunction with the attracting of private investors to meet Egypt’s increasing needs for adaptation and mitigating the effects of climate change, will enhance the flexibility of the economy, and they agreed that these reforms will complete and enhance the efforts to reduce risk within the framework of the extended agreement.
The directors supported the completion of the fourth review under the agreement to facilitate the extended fund, and Egypt asked to exempt from not adhering to performance standards and amending them, and they also supported its request to conclude an agreement under the flexibility and sustainability facility.
It is expected that the upcoming consultations on Article 4 with Egypt will be held in accordance with the executive council’s decision regarding consultations for members with arrangements with the fund.
