In its latest report on the economic outlook for the Middle East and Central Asia region, the International Monetary Fund explained that economic growth in Egypt depends largely on massive investments in infrastructure and energy, which are vital factors for driving economic activity, as the government has engaged in huge projects that include transportation, housing. , and basic services, with the aim of developing infrastructure, providing new jobs, and promoting investment. Among these projects comes the New Administrative Capital project and other urban expansion projects that have contributed to the prosperity of the construction sector, which in turn enhances other sectors such as trade, industry, and tourism, creating A multiplier effect that enhances overall economic growth.
As for the energy sector, especially natural gas, it represents another pillar of Egypt’s economy, as the country seeks to become a regional energy center through discoveries such as the Zohr gas field. These efforts contribute to reducing Egypt’s dependence on energy imports, attracting foreign investment, and generating revenues. of hard currency, as the Fund believes that the energy sector, along with infrastructure projects, will be pivotal to achieving the expected growth over the next two years.
The Fund pointed out that the Central Bank of Egypt has taken several measures aimed at reducing inflation, by adjusting interest rates to manage demand and stabilize the currency, and the Central Bank has set two ambitious goals to reduce inflation, the first by 7% in the near term and 5% in the medium term, and the report confirms that control On inflation will be fundamental to sustainable growth.
The IMF report stressed the importance of efforts to control public finances and structural reforms to stabilize the Egyptian economy, stressing that the government has implemented a set of measures aimed at reducing public debt, enhancing revenue collection, and reducing unnecessary expenditures. Egypt has also introduced a series of tax reforms aimed at expanding the base. Tax, increasing efficiency and enhancing a sustainable financial environment.
The IMF praised these measures, stressing that they are vital steps towards improving public financial management, which is necessary to ensure the sustainability of public finances. The International Monetary Fund report also indicated that the Egyptian government has achieved progress in creating job opportunities through huge projects.
Source: Sada El Balad
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**Interview with Dr. Amina El-Sayed, Economist and Middle East Analyst**
**Editor:** Thank you for joining us today, Dr. El-Sayed. The recent approval of $820 million in funds by the IMF for Egypt seems significant. What does this mean for the country’s economic outlook?
**Dr. El-Sayed:** Thank you for having me. The IMF’s approval is indeed an encouraging sign. It reflects a recognition of Egypt’s efforts to stabilize its economy, particularly through diversification and infrastructure investment. The funding will provide crucial support that can bolster current projects and potentially attract further investments.
**Editor:** The IMF report emphasizes the importance of infrastructure and energy investments in driving economic growth. Can you elaborate on how these investments are expected to impact the economy?
**Dr. El-Sayed:** Absolutely. Investment in infrastructure, such as the New Administrative Capital and urban expansion projects, creates a framework for economic activity. When the government invests in transportation, housing, and basic services, it doesn’t just improve quality of life but also stimulates job creation. This, in turn, has a ripple effect throughout the economy, benefiting sectors like trade, industry, and tourism.
**Editor:** What role does the energy sector, particularly natural gas, play in this economic equation?
**Dr. El-Sayed:** The energy sector is crucial for Egypt. It has the potential to not only meet domestic needs but also turn Egypt into a regional energy hub. Natural gas production can generate significant revenue and provide energy security, which is essential for attracting industrial investments. Enhanced energy infrastructure can empower other sectors reliant on stable energy supplies, thereby supporting overall economic growth.
**Editor:** Are there any potential challenges that could arise from the reliance on these sectors for economic development?
**Dr. El-Sayed:** Yes, while infrastructure and energy are vital, there are challenges, such as ensuring the sustainability of these projects and managing public debt. It’s also essential not to neglect other sectors that contribute to economic diversity. A balanced approach that safeguards against over-reliance on any single industry will be crucial for long-term stability.
**Editor:** Thank you, Dr. El-Sayed, for your insightful analysis. It will be interesting to see how these developments unfold in Egypt’s economic landscape.
**Dr. El-Sayed:** Thank you for having me. I look forward to seeing how Egypt navigates these challenges and opportunities in the coming months.
