URGENT: IMF to extend significant support to Egypt – chief

The International Monetary Fund (IMF) is expected to extend significant support to Egypt as it was successful in implementing comprehensive plans to reform the subsidy file, its managing director said on Sunday.  These plans were characterised by directing greater attention to the neediest groups.

The IMF, in co-operation with Egypt, have reached the final stages of completing the first and second reviews of the country’s programme and the results will be announced within a few weeks, Kristalina Georgieva told the World Government Summit being held in Dubai.

She added that the Fund was seeking to give a dose of confidence to the Egyptian economy by enhancing the size of the support programme.

Flexible exchange rate not flotation

“Our negotiations with Egypt are related to a flexible exchange rate, ‘not currency floating’. We have identified Egypt’s financing gap and will announce it soon,” she was quoted as saying.

She urged Egypt to move forward to complete its projects, which are under implementation, within a well-studied timetable. She further advised Egypt not to sell shares in government companies in light of the unstable regional conditions.

The IMF chief further advised Egyptian government to give priority to contain inflation and provide a flexible exchange rate for the pound to absorb shocks.

She added that the economies of the countries neighboring Israel and the Palestinian territories witnessed an impact on tourism revenues, with the Red Sea attacks raising shipping costs globally.