São Paulo – Egypt’s economy is recovering as recent government efforts to restore macroeconomic stability start to show positive results, the International Monetary Fund said, according to Arab News.
The fund said that the inflation rate in Egypt remains elevated but is coming down.
The North African country has been implementing several economic reforms to maintain fiscal stability, which includes the unification of the official and parallel exchange rates in March.
Since then, the country’s economy has improved significantly, with the Egyptian pound becoming market-determined.
“The unification of the exchange rate and the accompanying monetary policy tightening have curtailed speculation, brought in foreign inflows, and have moderated price growth,” said Antoinette Sayeh, deputy managing director and acting chair at the IMF.
Challenges for the economy
The fund added, however, that the country is facing hurdles in implementing the ongoing reforms due to geopolitical issues like the conflict in Gaza and tensions in the Red Sea.
“Risks remain significant,” Sayed says, suggesting several implementations that could boost the economic stability of Egypt in the future, including a structural reform agenda and measures that increase tax revenues.
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Translated by Guilherme Miranda
