15 November 2018 12:17 AM

IMF reaches staff-level agreement on 4th review of Egypt's EFF

Friday، 02 November 2018 - 11:49 AM

The successful completion of a staff-level agreement between the IMF team and the Egyptian authorities proved the strength of the country’s economy and that reforms are on track despite the recent global economy volatility, Minister of Finance Mohamed Maait said Thursday.

 

The agreement would allow the IMF staff team to discuss the review results with IMF’s Executive Board in December, before releasing the fifth tranche of two billion US dollars, bringing total disbursements under the program to about 10 billion US dollars, Maait said in a statement.

 

During the fourth review, the staff teams of the Finance Ministry and Central Bank of Egypt expounded the reforms pace and its implications on improving the economy and all the fundamentals, the minister said, adding that the most important improvement was the growth rate which reached 5.3 percent in 2017/2018, recording the highest growth rate in the Middle East and North Africa.

 

He went on to say that upping the growth rate coincided with a reduction in the unemployment rates to 9.8 percent in June 2018, which is the lowest rate ever since year 2010.

 

The minister also pointed out that IMF experts praised the big improvement in the public financial indexes and debts, noting that the gross fiscal deficit (GFD) decreased from 10.9 percent to 9.8 percent for the first time in 15 years.

 

The IMF staff team and the Egyptian authorities have reached a staff-level agreement on the fourth review of Egypt’s economic reform program, which is supported by the IMF’s SDR 8.597 billion (about $12 billion) Extended Fund Facility arrangement, IMF said in its statement on Wednesday.

 

"GDP growth accelerated from 4.2 percent in 2016/17 to 5.3 percent in 2017/18 while unemployment declined to below 10 percent. Meanwhile, the current account deficit narrowed to 2.4 percent of GDP in 2017/18 from 5.6 percent the year before, primarily driven by strong remittances and a recovery in tourism. Gross general government debt declined from 103 percent of GDP in 2016/17 to about 93 percent of GDP in 2017/18, supported by fiscal consolidation and higher growth," it added.

 

The IMF said GDP growth accelerated from 4.2 percent in 2016/17 to 5.3 percent in 2017/18 while unemployment declined to below 10 percent.

 

Meanwhile, the current account deficit narrowed to 2.4 percent of GDP in 2017/18 from 5.6 percent the year before, primarily driven by strong remittances and a recovery in tourism. Gross general government debt declined from 103 percent of GDP in 2016/17 to about 93 percent of GDP in 2017/18, supported by fiscal consolidation and higher growth, the statement elaborated.

 

MENA

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