All you need to know about Egypt’s commitments, targets under new IMF programme
The report detailed the main targets and commitments the government has pledged under the four-year programme, highlighting the risks that could affect its implementation and hinder the government’s efforts over the coming four years.
Hereunder is a sum-up of Egypt's commitments, targets, and risks as detailed in the report.
** Egypt secured the $3 billion loan with exceptional access, as the country had already surpassed the cumulative access limit of 435 percent of its quota under the $5.2 billion Stand-By Arrangement loan it had secured in FY2020/21 to address the impacts of the COVID-19 outbreak.
** Egypt’s capacity to repay the loan is adequate, albeit with some risks that stem from the need to stay the course of its ongoing economic reform programme amid heightened uncertainty caused by the ongoing war in Ukraine.
** Risks to the global outlook affect Egypt’s prospects for a fast recovery, the pace of replenishing reserves, and the speed at which imbalances can be tackled. These challenges could test the authorities’ commitment and ability to sustain the reforms and reduce debt risks.
** Risks over the near term include exchange rate misalignment, prolonged inflationary pressures that could undermine social cohesion, and high financing costs with a further shortening of domestic debt maturities and limited external market access.
** Risks over the medium term include mainly the debt sustainability driven by the lower growth and tighter domestic and external financing conditions.