WASHINGTON, July 17, 2018 (MENA) - International Monetary Fund (IMF) Mission Chief for Egypt Subir Lall said on Tuesday that the monetary policy adopted by the Central Bank of Egypt (CBE) is good and has helped contain the repercussions of floating the Egyptian pound against the US dollar.
In statements to MENA, he added that the policy of the CBE comes within the framework of a holistic economic policy that seeks to stimulate the national economy.
One of the fruits of this policy is that inflation went down since mid 2017 until May 2018, he said, noting that a recent increase in fuel prices led to a limited increase in inflation rates in June.
He expected that inflation rates will keep going down in the coming period thanks to the viable measures adopted by the Egyptian government.
He confirmed that the IMF will keep supporting the Egyptian economic reform program.
CAIRO, July 15, 2018 - The economic reform measures adopted by the Egyptian government have contributed to achieving economic stability in the country, the International Monetary Fund (IMF) Mission Chief for Egypt, Subir Lall, said.
The package of ambitious economic reform measures under Egypt’s national programme, has led to the realisation of several important achievements including in the foremost reducing inflation, reinvigorating the economy, improving growth rates and cutting unemployment rates, Mr Lall said in exclusive statements he gave to the official Middle East News Agency (MENA) Sunday.
The economic reforms have included the liberalisation of the exchange rate, cutting energy subsidies, applying the value added tax (VAT) and improving the investment climate by issuing a number of laws such as the investment and industrial licence laws, he noted.
In its third major review of Egypt’s loan programme last Thursday, the IMF maintained a favourable outlook for Egypt’s economy. On July 5, Egypt announced that it had a primary budget surplus for the first time in 15 years.
Finance Minister Mohamed Maeet said Egypt achieved a 0.2 per cent primary budget surplus, worth LE4 million ($223 million), in its 2017-2018 fiscal year. It is aiming for a 2 per cent primary surplus in the current fiscal year.
Foreign reserves also rose by the end of June to $44.258 billion from $44.139 billion, continuing their climb since the country secured the $12 billion IMF loan, according to the Central Bank of Egypt (CBE).
Foreign investment in equity and debt markets has reached record highs since the country embarked on the reforms, Reuters reported.
Mr Lall commended the government for initiating measures to increase spending in the health and education sectors and introduce such structural reforms as would facilitate the start of business enterprises, the encouragement of entrepreneurship, the promotion of small and medium-scale enterprises and the improvement of transparency in state-owned establishments
Creating new job opportunities and raising the standard of living contribute to effectuating the realisation of higher growth rates, the IMF mission chief said. He referred in this connection to the government’s move to expand the social protection nets and support the social protection programmes for deserving segments.
He pointed out that the bonuses for civil servants reached about 7 to 10 per cent of total salaries, noting that social insurance pensions rose by 15 per cent.
Mr Lall said that the government has boosted the foreign competitiveness and expanded restructuring reforms under its national programme to help overcome the main obstacles facing the private sector.
WASHINGTON, July 15, 2018 (MENA) - Subir Lall, the International Monetary Fund (IMF) Mission Chief for Egypt, said the economic reform measures adopted by the Egyptian government have contributed to achieving economic stability in the country.
In statements to MENA on Sunday, he said the ambitious Egyptian economic reform programme has led to several important achievements, including reducing inflation and unemployment rates.
The reforms included liberalizing the exchange rate, cutting energy subsidies and improving the investment climate, he noted.
Upping growth rates is helping to create new jobs and raise living standards for the Egyptians, he said.
He also referred to the government's move to support the social safety net to be more effective in serving large segments of poor families.
He commended the government for taking measures to up spending in the health and educational sectors.
He pointed out that bonuses for civil servants reached about 7 to 10 percent of total salaries, noting that social insurance pensions rose by 15 percent.
By Gazette Staff:
CAIRO, July 12, 2018 - The International Monetary Fund (IMF) maintained a favourable outlook for Egypt's economy in its third major review of the country's loan programme on Thursday, a Reuters report said.
The three-year $12 billion loan programme was agreed between the Egyptian government and the IMF in late 2016 and was aimed at drawing back investors with Egypt undertaking tough reforms such as slashing energy subsidies, imposing new taxes, and floating its pound currency.
The country raked in $2.27 billion dollars in tourism revenues in the quarter from January-March, the latest available data from the central bank showed.
The Fund said that should help Egypt reduce its overall current account deficit to 2.6 per cent in 2018-2019, down from a previous projection of 4 per cent.
The IMF estimated that Egypt would face a financing gap of $1 billion for the year, which it could plug through either a Eurobond or its own reserves, suggesting that Egypt could tap international markets again this year.
It said that external debt was likely to rise to $91.5 billion from a previous projection of $85.2 billion in its second review.
Inflation has soared in the import-dependent country after it floated its currency in late 2016, hitting over 30 per cent last year, but price rises have cooled in recent months.
Recent IMF-backed cuts to energy subsidies have pushed inflation back up however, to 14.4 per cent in June from 11.4 per cent in May.
The Fund expects average inflation for the 2018-2019 fiscal year to be 14.4 per cent, and urged tight monetary policy to keep a lid on prices.
"The Central Bank of Egypt should maintain its restrictive stance to contain second-round effects of fuel and electricity price increases, with future policy changes guided by inflation expectations and demand pressures," IMF First Deputy Managing Director David Lipton said.
Egypt's fuel subsidy bill is expected to account for 2.1 per cent of gross domestic product in the 2018-2019 fiscal year, the report said, up from a previous estimate of 1.2 percent on the back of higher global fuel prices.
Foreign investment in Egypt's equity and debt markets reached record highs since the country embarked on the reforms, though foreign direct investment outside the energy sector has remained sluggish.
The IMF warned that a general pullback from emerging markets by investors presents a risk, but said Egypt is "well-positioned" to weather any outflows due to healthy foreign reserves, which hit $44.258 billion at the end of the 2017-2018 fiscal year.
PARIS, July 8, 2018 (News Wires) - The European Union has "a card to play" if it offers a united front in its response to the trade war pitting the United States against China, International Monetary Fund (IMF) director Christine Lagarde said.
"In the show of force we see coming to bear... between the United States on the one hand and China on the other, who represent two totally different forms of capitalist impetus, Europe can play a very particular card," Lagarde told an economic forum in the southern French city of Aix-en-Provence.
"Europe is strategic for the one as for the other (the United States and China)" when it comes to trade, said Lagarde a week ahead of a bilateral EU-China summit which the latter will host July 16 and 17 in Beijing.
She added Europe had the power to balance out the commercial powerplay between Washington and Beijing with neither enjoying sufficient leverage to swing it to either camp.
"The Europeans together are a force, a power. When they are united they have a true voice" which can count, said Lagarde, adding that the EU could be a "source of inspiration for many other countries in the world."
DAKAR, July 7, 2018 (News Wires) - Cameroon's economy is expected to grow 4 percent this year, up from 3.2 per cent in 2017 due to the start of natural gas production and construction work for an upcoming soccer tournament, the International Monetary Fund (IMF) said.
Growth was slower in 2017 because of a sharp decline in oil output but new infrastructure projects and increased private investment should bring it to at least 5 percent in the medium term, the IMF said in a statement late Friday.
Cameroon, one of central Africa's largest economies, produces about 180,000 barrels per day of oil and is Africa's fourth-biggest cocoa producer.
The IMF statement followed a decision by its executive board to approve the disbursement of $77.8 million as part of a three-year, $680.7-million financial aid package.
The IMF warned, however, that the economy faces considerable risks, including deteriorating security in its English-speaking regions -- cocoa and oil-producing areas where separatists are waging a deadly insurgency, and high debts.
"With significant spending pressures associated with the 2018 elections, a worsening security situation and the 2019 African Soccer Cup, any additional oil revenue should be saved," said Mitsuhiro Furusawa, the Fund's deputy managing director, referring to the 2019 Africa Cup of Nations due to be held next June.