(3 Minutes Read)
The International Monetary Fund (IMF) Managing Director Kristalina Georgieva and U.S. Treasury Secretary Janet Yellen are scheduled to meet with Egyptian authorities to deliberate on the potential expansion of Egypt’s current USD 3 billion loan program. The meeting will occur in the backdrop of ongoing discussions between Egypt and the IMF regarding Egypt’s economic challenges, and the United States’ commitment to supporting Egypt’s economic reforms.
In December 2022, Egypt entered into a loan agreement with the IMF. However, the relationship faced hurdles due to Egypt’s reluctance to allow its currency to float freely and delays in the privatisation of state-owned assets, conditions attached to the IMF loan. Consequently, the IMF held back about USD 700 million in disbursements expected in 2023.
It is anticipated that Secretary Yellen aims to learn about Egypt’s strategies to confront its economic challenges and intends to express support for Egypt’s reform efforts aimed at bolstering the economy and fostering inclusive and sustainable growth. The involvement of IMF Chief Georgieva highlights the gravity of the talks and the potential impact on Egypt’s economic future.
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Egypt is grappling with the economic aftermath of the conflict between Israel and Gaza. The turmoil has heightened economic risks, disrupting tourism and natural gas imports, two significant contributors to Egypt’s economy. This precarious situation has triggered the IMF’s consideration to expand the loan program beyond the initially agreed USD 3 billion. The meeting in Washington will thus serve as an essential platform to address these challenges and revisit the terms of the loan program.
