2023-05-03 10:52:00
01:52 PM
Wednesday 03 May 2023
Cairo – Masrawy:
Jihad Azour, Director of the Middle East and Central Asia Department at the International Monetary Fund, said that the flexibility of the exchange rate in Egypt is necessary to support its economy in the face of external shocks, and “the flexibility of the exchange rate is the best way for Egypt to protect its economy from external shocks.”
Since it agreed with the International Monetary Fund on a $3 billion financing program last December, Egypt has pledged to adopt a flexible exchange rate that reflects supply and demand for foreign currency. However, in return, it faces challenges to bridge the funding gap, especially with the rise in import prices since the Russian-Ukrainian war.
Egypt obtained the first tranche of the IMF loan amounting to $347 million, while the first review of the program, which was scheduled for mid-March, was delayed to obtain the second tranche.
“We are still supporting Egypt… and we are in talks with the authorities to prepare for the first review of Egypt’s program,” Azour said, adding that the fund will announce the start date for the first review when an agreement is reached with the government.
Azour stressed that the financing program reached by the fund with Egypt aims to spare the Egyptian economy from external shocks and put it on the path of high growth, job creation and opportunities.
He said that the suffering of high inflation is still continuing and shocking the Egyptians and the Egyptian economy, and that the Fund encourages the Egyptian authorities to use monetary policy, especially interest rates, to face the dilemma of inflation.
The annual inflation rate in Egypt’s cities jumped during the month of March, to 32.7%.
Azour said that the Egyptian economy has opportunities and more opportunities must be provided to the private sector, which is vital, to allow it to create more growth and foreign exchange.
And last year, the government announced the state ownership document, from which it aims to exit from several sectors, partially or completely, to make room for the private sector, in addition to announcing a program for offerings.
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