PM: IMF welcomes Egypt's social protection program, does not force state to take measures harming citizens



Thu, 25 Aug 2022 - 07:39 GMT


Thu, 25 Aug 2022 - 07:39 GMT

CAIRO – 25 August 2022: The International Monetary Fund (IMF) welcomes the government's social protection programs and does not force the state to take measures that harm Egyptian citizens, affirmed Prime Minister Moustafa Madbouli on Thursday.

There is no way to attain economic reforms without the existence of a sound social protection program, he added during a press conference held at the government headquarters in New El Alamein city to announce the implementation of an additional social protection package within the "Takaful and Karama" cash-support program.

The IMF welcomes the new social protection package, he said, criticizing the state of confusion which dominated the Egyptian street about the details pertaining to an IMF deal.

Negotiations with the IMF are confidential and cannot be revealed before reaching an agreement in this respect, he added.

He further reaffirmed that negotiations with the IMF started before the Russia-Ukraine crisis, saying that the program ended on June 30 and new negotiations have started after that.

Until the end of last year, negotiations dealt with providing technical support to help the State in pursuing the economic reform programs and the structural reforms of the various sectors, he went on to say.

But after the Russia-Ukraine crisis, Egypt decided to seek a new loan from the IMF along with more technical support, he added.

Meanwhile, the premier said that the strategic reserve of all basic commodities, is "safe" and sufficient for seven months.

All commodities are available and will not be affected by the additional social protection package, he added.

Economic growth

Madbouli said economic indicators for the 2021-2022 fiscal year showed that the Egyptian economy achieved a 6.6 percent growth rate, one of the highest in recent years, despite the current global crisis.

The last quarter of the past fiscal year was really difficult due to the Russia-Ukraine war and its effect on development rates, the premier said, noting that Egypt's projected growth rate for the end of the fiscal year had been estimated at 6.2 percent.

Madbouli added that the unemployment rate in the country stabilized at 7.2 percent, which he described as an "encouraging figure".

The real challenge for the State is the global phenomenon of high inflation rates, he said, revealing that inflation has hit 14.6 percent in Egypt. 

Family ration cards

A decision has been issued to add EGP 100 to family ration cards as of September, affirmed Madbouli.

This amount will be used in a number of commodities determined by the Supply and Internal trade Ministry, added Madbouli.

The number of ration cards which will be used by citizens stands at 8.11 million, covering a total of 9.1 million families, which amounts to over 37 million individuals, he further said.

The state will include about half a million family to "Takaful and Karama" cash transfer program as of September, added Madbouli.

The National Alliance for Civil Development Work (NACDW) will also provide cash aid to about 420,000 families, he went on to say.

The total number who will receive the aid will stand at about 5 million, he noted.

The state will bear an additional EGP 3 billion as a result of this decision, added the premier.

The NACDW will further provide food subsidy to 180,000 families, he added.

"Takaful and Karama" conditional and unconditional cash transfer program is among Egypt’s largest investments in human capital development.

The name of the social safety net program translates to "Solidarity and Dignity" and was launched in 2015 with the support of a US$400 million World Bank program.

The Takaful and Karama program is implemented by the Ministry of Social Solidarity and covers millions of individuals.

Cash subsidy

Madbouli said nearly 5 million Egyptian families are going to get cash subsidy, adding that the exceptional social protection package announced by President Sisi will be implemented once logistic measures are finalized.

Madbouli stressed that the national economy is strong and capable of facing any challenge but overpopulation remains the biggest major challenge the country faces.

This year, 2.185 million new births will be recorded, he said, making clear that this derails government's efforts to improve living standards.

He noted that people will start to sense the tireless efforts the government exerts for a better future if each family has only two children as this will help bring population growth under control.

He said the economic growth rate will increase to 6.6% this year prompted by the 7.8% growth hike recorded in the first months of the year.

Meanwhile, Madbouli stressed that the government presented urgent legislation to the parliament as regards prohibiting child marriage, school dropouts and child labor.

Egypt Today contributed to the reporting.



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