IMF welcomes growth prospects for Egypt

Maurice Obstfeld, chief economist of the IMF, said Egypt has the economic fundamentals needed to achieve solid growth rates in the coming years, provided fiscal and monetary reforms continue, but he stressed that despite improving current levels of debt in Egypt, they remain serious in the current environment.

"Egypt has the capacity to achieve higher growth rates than today, but it needs to improve the business climate and provide the necessary laws to facilitate it, by supporting the private sector and small and medium enterprises, "he said at a meeting with the US Chamber of Commerce in Egypt on Thursday night. The Egyptian treasury markets are under pressure and it is important that the government redouble efforts.

The central bank announced last week the increase in domestic debt to 3,594 billion pounds sterling (about 207.5 billion dollars) at the end of June, against 3.536 billion pounds sterling (198, $ 65 billion) at the end of March, an increase of 4.5%. The Central Bank said net domestic public debt rose from 2,900 billion pounds (about $ 163 billion) to 3,200 billion pounds during the period.

The net debt of public economic entities reached £ 317.6 billion ($ 17.8 billion) at the end of June, compared with £ 287.3 billion ($ 16.14 billion). ) at the end of March 2006. The net investment of the National Bank of Investment reached 473.02 billion pounds sterling (26.57 billion dollars) Interbank debt recorded 216.03 billion pounds ($ 12 billion) during the period.

At the end of the visit of the IMF team led by Supair Lal, which took place from October 18 to 31, the International Monetary Fund (IMF) declared that the Egyptian economy continued to to behave well thanks to the strong support of the authorities in the reform program. Despite adverse global conditions, general government debt is projected to rise from 103 percent of gross domestic product in 2016 to 2017 to 93 percent of GDP in 2017-18, reflecting fiscal consolidation and increased growth.

Speaking before the US House on Wednesday night, Obstfeld said that the global economy's growth forecasts for 2018 and 2019 were reduced from 0.2% to 3.7%, with a less balanced global expansion and the latest tariff cycle imposed by the United States. China.

Opstfeld attributed this reduction to factors such as the US-China tariff exchange, the performance of the Eurozone countries, Japan and Great Britain, and the rising interest rates. interest in certain emerging markets with capital flight, notably in Argentina, Brazil, Turkey and South Africa.

The failure of the negotiations on the exit of the United Kingdom from the euro area and the tightening of financial conditions in the emerging and developing market economies seeking to adjust to the gradual rise in Fed rates and at the European Central Bank is another risk factor. For purchases of assets.

The sharp rise in political uncertainty over the past year is another source, according to Opstfeld, a development that has not yet been seen in the financial markets of developed economies, but which is reflected in uncertainty of current news. As a result of actions taken – or threatening to take – by the United States at various levels, as evidenced by the reactions of their trading partners and the general decline of multilateral consultations on trade issues.

He pointed out that, compared to 10 years ago, the high level of debt of companies and sovereign entities in many emerging and emerging countries made them more vulnerable. "The Emerging Markets Crisis Could Renew In The Future And All Emerging Countries Should Prepare For It By Applying Policies" At the same time, he stressed that the growing protectionism in superpowers' policies will affect the movement of world trade, which will affect the growth rates of the global economy, pointing out that "globalization" will not stop and will remain as such international interdependence.