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Egypt’s reforms softened ramifications of crises ailing the economy

Egypt’s reforms softened ramifications of crises ailing the economy

News report by Abdulaziz Faisal CAIRO, Egypt has been gripped with diverse geographical challenge’s namely the crises in Gaza, Sudan and the Red Sea.

Despite pressure that had emanated, over the past years, from the coronavirus and the Russian-Ukrainian war, Egypt’s economic reform plans, execution of which began in 2016, have contributed to limiting ramifications and ripples of these surrounding crises with minimal losses.

The latest agreement with the International Monetary Fund came as a relief and a stimulant for the troubled economy, amid aspirations that the private sector would play a leading role in boosting it.

The forecast USD 12 billion loan from the IMF, due to be paid in three years’ installments, is expected to help in overcoming problems facing reform schemes, particularly the funding and shortage in hard currencies.

Moreover, Ras Al-Hekma transaction, worth USD 35 billion, has fed the hard currencies reservers and stemmed inflation after the pound turned drastically bearish vis a vis the U
S dollar, trading at 70 pounds for a single greenback.

The Prime Minister, Mostafa Madbouly, has affirmed in this regard that the accumulation of the US dollars would be invested in resolving the economic crisis, would contribute to the efforts to resolve the foreign currencies issue and paying external debts estimated at USD 165 billion.

For his side, the Finance Minster Mohammad Maait cited some positive factors, the forecast iflow of USD 20 billion after the agreement with the IMF and USD 7.4 billion worth of the financial package pledged by the EU.

The former minister of petroleum, Osama Kamal, said in a statement to KUNA that the state is facing rippling challenges and unprecedented developments at the regional and international levels. However, it has adopted a clear approach based on attaining stability, expanding the scope of development, enhancing the local production and supporting the economy.

Egypt is steady on the track to attain its full-fledged development plan to resolve the financial cris
is, he said, indicating that much hope is pinned on projects to overhaul the infrastructure, transports , luring investments alluding in particular to the Egypt-UAE Ras Al-Hekma project, which would help in reducing the debts.

The state of Egypt has multiple wealth resources that enable it to secure substantial proceeds and stabilize the domestic economy, Maait said, indicating in this respect to abundant human resources, with statistics showing that 60 percent of the population is aged under 40.

However, he said that Egypt has huge natural resources and a special geographic location, water and metal resources, renewable energy and wide lands feasible for investment.

He called on the government to overhaul the investment atmosphere and cut red tape.

Meanwhile, the first undersecretary of the parliamentary committee of economic affairs, MP Mohammad Ali, told KUNA that external support helped in resolving temporary issues, namely the currency shortage. Nevertheless, the economy still hinges on the trade bal
ance, expenditures, exports and imports.

He called for increasing the exports, backing up the local industrial and agricultural sectors to attain sustainable economic growth, which in turn would cut spending on the exports and secure substantial resources of the USD.

MP Ali also called for restricting imports to basic products and encouraging local production He has affirmed that the external support is crucial for the economy and underscored success of Ras Al-Hekma project that brought in hard currencies.

Source: Kuwait News Agency