Egypt Daily News – The International Monetary Fund (IMF) is currently overseeing an $8 billion program for Egypt, which has recently seen notable progress.
Jihad Azour, the IMF’s Director for the Middle East and Central Asia, stated that while the program is making strides, it is too early to discuss any potential increases to the loan size.
This program was expanded in March when it was increased from $3 billion to $8 billion, coinciding with the central bank’s decision to liberalize the exchange rate amid heightened tensions due to the ongoing Israel-Gaza conflict.
President Abdel Fattah el-Sisi has voiced concerns about the necessity to reassess the loan program should international bodies fail to acknowledge the unique regional challenges facing the nation. In response, Azour expressed optimism about Egypt’s economic trajectory, noting expectations of improved conditions, a recovery in growth, a gradual decrease in inflation, and a stabilizing foreign exchange market.
He highlighted the importance of boosting Egypt’s financial reserves as a proactive measure to bolster the economy against external shocks.
The IMF anticipates that through recent reforms, Egypt could save an estimated $800 million over the next six years.
In terms of economic forecasts, the IMF projects a GDP growth rate of 4.1 percent by 2025, an increase from about 2.7 percent this year, with medium-term growth expectations of over 5 percent.
This optimistic outlook is contingent on a de-escalation of the Israel-Gaza conflict and the ongoing implementation of reforms within Egypt.
Inflation is also expected to decline, predicting a rate of around 16 percent by the end of the 2024/2025 fiscal year, a significant reduction from the nearly 40 percent recorded in September of the previous year.
The IMF team focused on Egypt is set to visit Cairo in November to conduct the third program review, with IMF Managing Director Kristalina Georgieva also planning to visit to reinforce the Fund’s support for the country.
