The Egyptian economy has begun to recover after four years of slow activity and there is a growing national consensus on the need for economic reform, an International Monetary Fund (IMF) staff team has observed at the conclusion of a visit to Cairo.
“Egypt faces many challenges. During the prolonged political transition, growth fell and unemployment and poverty increased to high levels. Budget deficits grew and external pressures led to a fall in foreign exchange reserves,” said mission leader Chris Jarvis. “This is a moment of opportunity for Egypt.”
During its 11-25 Nov. visit, the team met with government and central bank officials, members of the banking sector and the diplomatic community in Cairo for discussions on the country’s economic and financial developments, the outlook, and the authorities’ economic policies and reform plans.
Recognising the challenges facing the country, Jarvis said, the Egyptian authorities have set appropriate economic objectives, including raising growth and steadily reducing inflation.
“The authorities have already begun to take the action needed to achieve their objectives. They have begun bold subsidy and tax reforms, are pursuing a disciplined monetary policy, expanding social policies, and have initiated wide-ranging regulatory and administrative reform efforts to improve the business environment and boost investment,” he said in a statement made available to PANA here Wednesday.
According to preliminary findings by the IMF team, the government is seeking to reduce the budget deficit to 8-8½ percent of GDP and the budget sector debt to 80-85 percent of GDP by 2018/19, while at the same time increasing spending on health, education, and research