The IMF wants Cairo to privatize state assets and allow flexibility in its currency, the Bloomberg report said.
The International Monetary Fund wants Egypt to implement more of the reforms that Cairo has committed to before conducting its first review of the $3 billion bailout package, Bloomberg News reports.
The Washington-based lender wants Cairo to privatize certain state assets and allow flexibility in the Egyptian pound to ensure the review is successful, Bloomberg reported Sunday, citing unnamed people familiar with the matter.
IMF Director Kristalina Georgieva said last week the fund was preparing to conduct the review, but did not say when it might take place.
Egypt must pass the review to access the second tranche of its loan worth about $354 million.
Jihad Azour, the IMF’s director for the Middle East, North Africa and Central Asia, said at a news conference last week that a flexible exchange rate would help protect Egypt’s economy from external shocks and that the state should support the private sector. allow “growth and create more foreign currency”.
The IMF announced in December an agreement to provide $3 billion over nearly four years to debt-ridden Egypt, including immediate access to $347 million.
Gulf allies, including Saudi Arabia, Qatar and the United Arab Emirates, have also offered support, though billions of dollars in pledged investments have yet to materialize as they seek clarity on the progress of the country’s financial reforms.
Egypt’s economy has been battling rising oil and food prices due to the aftermath of the COVID-19 pandemic and the war in Ukraine, with the Egyptian pound losing half its value against the dollar since March.
According to government figures, about a third of the country’s 104 million people live in poverty. Many Egyptians depend on government subsidies to keep basic goods such as food affordable.
As part of the IMF deal, Cairo has agreed to sell stakes in several dozen state-owned companies this year and pledged to move to a flexible exchange rate, though the stability of the pound has raised questions about the government’s commitment to its reforms.