Egypt’s government and the International Monetary Fund (IMF) reached a staff-level agreement on the third review of an Extended Fund Facility (EFF). The staff-level agreement paves the way for Egypt to get $820 million.
A final approval of the third review of Egypt’s EFF-supported program by the IMF’s Executive Board is expected in the coming weeks.
The government, in collaboration with the Central Bank of Egypt (CBE), has carried out a raft of financial and monetary measures to reform the nation’s economy.
The IMF agreement reflects the success of Egypt’s recent measures to rein in inflation and boost real economic growth. The CBE’s Monetary Policy Committee (MPC) raised key overnight interest rates by 600 basis points on March 6 in a bid to combat high inflation.
A final agreement is expected to further boost Egypt’s economic growth and financing resources.
Ivanna Vladkova Hollar, head of the IMF mission, said the Egyptian authorities have stayed the course to preserve macroeconomic stability through fiscal discipline, tight monetary policy, and a shift to a flexible exchange rate regime.
“These efforts are beginning to deliver an improved outlook, improved FX availability, inflation starting to slow down, and signs of recovery in private sector sentiment,” Hollar said in a statement.
Hollar has said strong policies are critical to address key risks and domestic structural challenges, including the need to boost the role of the private sector in economic activity, and addressing the challenge of high inflation, elevated government debt and high gross financing needs.
“In this context, the authorities and the mission agreed that the implementation of the government reform plans as articulated in program commitments will be key to maintain macroeconomic stability and enhance private sector-led growth,” she said.
Source: The Egyptian Gazette
