IMF Chief: Egypt Successfully Moved toward Flexible Exchange Rate System

Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF) said that Egypt has successfully moved to achieve a flexible exchange rate system, and in this regard praised the efforts of Hassan Abdullah, the governor of the Central Bank of Egypt (CBE).

This came during statements of the IMF chief at the headquarters of the Egyptian Cabinet in the new administrative capital.

Meanwhile, Georgieva spoke about the position of the partnership between Egypt and the International Monetary Fund at the moment.

She began her speech by thanking and welcoming the fruitful and inspiring partnership between Egypt and the International Monetary Fund.

I have come this time to express and extend my appreciation to President Abdel Fattah al-Sisi, the Egyptian government, and Egyptian citizens, for the remarkable strength all of them have shown at a difficult time in the region,” added Kristalina Georgieva.

She said: I wanted to tell everyone from here, from Cairo, how the International Monetary Fund deeply appreciates that partnership with Egypt, and we provide full support to Egypt in order to stabilize the country and achieve economic development.

The Managing Director of the International Monetary Fund continued: We showed that support last April when we made a decision to increase the size of the original program with the Egyptian government from $3 to $8 billion, which expresses our awareness of the increasing challenges and difficulties due to the surrounding circumstances.

We also did this because we realized the commitment and strength of the measures already taken by the Egyptian state, in order to enhance economic resilience, she added.

In addition to the above, Egypt has succeeded in increasing the role of the private sector as a source of support for economic growth and increasing employment opportunities, she continued, stressing that this measure is very important if we want to provide opportunities for citizens, especially young people.

Kristalina Georgieva added that Egypt was able to strengthen social protection by phasing out government support, and providing that support to the groups that already need.

She said: The implementation of all these measures contributed to enhancing macroeconomic stability, noting that the results of many of these measures have already appeared on the ground, we have witnessed an increase in the growth rate, and we expect the growth rate for the current fiscal year to reach 4.2% during the fiscal year 2024-2025, compared to 2.4% during the last fiscal year, and the inflation rate fell to about 25% or 26% after it was 37% last year, and there is a tendency to reduce the inflation rate to fall to 16% or 17% by the end of the current fiscal year, and this is very important for everyone, especially the poor and middle class.

She added that the rate of debt accumulation has decreased, meaning that Egypt is safer in a world of economic shocks.

She explained that reform is not easy, and here I would like to commend the efforts of the Egyptian government and people, saying: My message to you is that I am fully confident that you will see the returns of these measures in the form of a more dynamic and prosperous economy.

She continued: We are in the new administrative capital, and what happened here shows us what we can achieve by adopting the approach of determination, noting that it is talking about insisting here in reference to 3 axes, first, applying policies that will provide greater macroeconomic stability and work to reduce inflation rates. Second, what can be done in order to achieve the prosperity of the private sector, which contributes to creating jobs for more than one million young people entering the labor market every year, and the nature of the steps that the Egyptian authorities can take in this regard. The third axis is how to support Egyptian targets in the field of green economy, noting that many discussions will be held on many of these matters during the next week regarding efforts to achieve these goals.

Georgieva explained that the world is changing steadily, and this requires you and us flexibility and adaptability, and above all the search for and pursuit of opportunities for the benefit of the people of this wonderful country.

She added: I came to Egypt on several visits, and every time the history and richness of Egypt amazes me, referring to the story of the dog that climbed to the top of the pyramid, and at the same time noting that she enjoys it every time she visits Egypt with nature in this beautiful country and its wonderful people.

Prime Minister Mostafa Madbouli announced Sunday that the fourth review of Egypt's program with the IMF will begin the day after tomorrow, and that the Fund's work team will start its work as of tomorrow in cooperation with the officials of the Central Bank of Egypt (CBE) and the concerned ministries.

PM and IMF Director