Dr. Jihad Azour, Director of the Middle East and Central Asia Department at the International Monetary Fund, said in an interview with Al-Arabiya that negotiations to obtain new financing are continuing with Egypt and things are progressing according to the schedule.
He pointed out that following reaching an agreement with Lebanon in April, there are a set of measures that the government must quickly take in order for this program to be presented to the fund’s management. as it has begun Negotiations with Tunisia Over the past months, it is continuing and progressing.
He pointed out that the rise in interest rates is linked to inflation jumps, so the monetary policies of central banks resort to raising interest rates to curb inflation, and “it is a priority for all countries, including countries in the region… Therefore, other complementary measures must be taken. On the social level, measures must be taken to protect the most Weakness through a targeted support policy, and at the economic level, working to reduce deficit levels and their impact on debt.”
He added: “The high levels of interest for countries that depend on foreign issuances, will have a reflection on the cost of debt, so it is necessary to hedge this type of risk through economic and financial reforms that contribute to reducing the need for financing and maintaining financial and economic stability.”
He said, “There is no doubt that this year was a year of multiple shocks, including the war on Ukraine and the rise in the cost of energy and raw materials, but there are countries in the region whose financial conditions will improve, such as oil-exporting countries, as it is expected that there will be surpluses exceeding one trillion dollars in the four or five years.” As for the rest of the countries, they are divided into two parts: those that depend on financing through financial markets, and that have to hedge the risks of rising interest, but we see that the financing capacity still exists, and there are countries that have to speed up the reform process because of the rise in the dollar and the benefits to be able to maintain economic stability. “.
Regarding inflation levels in the Gulf countries, the Director of the Middle East and Central Asia Department at the International Monetary Fund stressed that they are lower than in other countries, given the structure of the consumer basket, but with the global rise in inflation it is necessary to adapt monetary policies to maintain acceptable levels of prices.
He continued, “On the other hand, the policies that have been adopted over the past years in terms of diversifying sources of income, are steps in the right direction, and it is necessary to continue and deepen them so that the economy becomes less dependent on energy.”
