Egypt, IMF likely to reach staff-level agreement soon

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Egyptian authorities and the staff of the International Monetary Fund (IMF) agreed to finalize their negotiations in preparation for reaching a staff-level agreement very soon, the IMF’s Director of Communications Gerry Rice revealed in a statement on October 15th.

The IMF’s staff and the Egyptian team have made “substantial progress” regarding all policies, Rice added.

He ensured that a “continued fiscal consolidation path” would help Egypt to shield public debt sustainability and cut the debt-to-GDP ratio in the medium term.

The two parties also discussed more fiscal and relevant structural policies to boost social protection for the most vulnerable, Rice said.

Moreover, he unveiled that these policies would improve the budget composition and fiscal transparency in Egypt.

“Monetary and exchange rate policies that would anchor inflation expectations, improve monetary policy transmission, improve the functioning of the foreign exchange market, and bolster Egypt’s external resilience. This would enable Egypt to gradually and sustainably rebuild foreign reserves,” Rice remarked.

The IMF’s spokesperson maintained that the new structural reform agenda would enhance the competitiveness of the Egyptian economy, reduce the state’s role in the economy, give more space for the private sector, improve the business climate, and paves the way for the transition towards a greener economy.

On October 12th, Egyptian Minister of Finance Mohamed Maait stated that negotiations with the IMF are progressing and the loan program is at its final stages.