CBE deputy governor: New IMF loan not to add burdens to people

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Thu, 14 May 2020 - 03:58 GMT

FILE - CBE

FILE - CBE

CAIRO - 14 May 2020: Deputy Governor of the Central Bank of Egypt (CBE) Rami Abul Naga said on Thursday that the new loan which Egypt will obtain from the International Monetary Fund (IMF) will not require additional economic reforms or add more burdens on people.

During a phone call with media personality Ahmed Moussa on Sada El Balad TV Channel, he said the economic reform program which Egypt put into effect in 2016 managed to create a strong economy capable of containing crises.

He said the Egyptian people bore a lot of burdens after adopting tough measures to realize economic growth.

He said Egypt has overcome many hardships after largely achieving economic and financial reforms.

The CBE injected more than LE 0.5 trillion to secure needed financial liquidity for the market and support productive state sectors, such as the industrial, agricultural, real estate and tourism sectors, he said, noting that this has helped in easing the repercussions of the coronavirus crisis.

Egypt's economic indicators were very good until mid March and if it had not been for the coronavirus crisis, it would have witnessed a remarkable economic growth, he noted.

Abul Naga said that the CBE did not record a sharp drop in remittances of Egyptians abroad despite the pandemic crisis.

He added that there is a growing demand on Egyptian agricultural products.

He noted that the exchange rate was stable, adding that part of the monetary reserve went to securing liquidity.

The tourism sector used to pump over dlrs 12.5 billion into the state treasury annually, he said, pointing out that the tourism and aviation sectors started to accrue losses due to the coronavirus crisis and this has prompted the CBE to launch an EGP 50 billion initiative to support them.

He added that about 700 financially-strapped companies resumed work with the support of initiatives which the CBE spearheaded over the past period.

The 2.8-billion-dollar emergency financial package provided by the IMF to the Egyptian government attests to the achievements realized under the economic reform program which led to high growth rates and job creation, he said.

The Egyptian economy was feted by a number of credit rating institutions and this reflects the Egyptian economy's capability to overcome the current crisis, he also said.

He added that the IMF's confidence in Egypt was manifested in offering the loan without conditions.

He added that Egypt is negotiating with the IMF to get a new loan at about $5 - 6 billion.

He noted that the Egyptian health system was doing well in confronting the pandemic, but this loan will offer needed support for the health sector and the social security nets.

Efforts will be stepped up in the coming period to create an investment-encouraging climate to generate jobs for youths, he pointed out.

The CBE will also work harder to realize financial inclusion and promote e-payment mechanisms, he said.

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