Mohamed Maait: Resorting to the IMF is an Exception, Not a Rule.. and $28 Billion Came to Address 3 Different Challenges
Mohamed Maait explains that Egypt underwent three IMF programs to face different challenges.
SUMMARY
Mohamed Maait explains that Egypt implemented three programs with the International Monetary Fund to address various economic challenges including after the January 25 Revolution, the COVID-19 pandemic, and the Russia-Ukraine war, with total financing of $28 billion, emphasizing that resorting to the IMF is exceptional and depends on economic conditions.
KEY HIGHLIGHTS
- Egypt implemented three programs with the International Monetary Fund to address different challenges.
- Total financing reached $28 billion during different periods.
- The programs aim to restore economic stability, reduce inflation, and increase foreign currency reserves.
- The decision to resort to the IMF is a sovereign government decision and considered exceptional.
CORE SUBJECT
Egypt's programs with the International Monetary Fund
Dr. Mohamed Maait, Executive Director and Representative of the Arab Group on the IMF Executive Board and former Minister of Finance, stated that Egypt has undergone three programs with the IMF in recent years due to "different challenges."
He added in televised remarks on Al Mehwar channel that the first program in 2016 came following "very difficult" internal challenges after the January 25 Revolution, with the foreign currency reserves declining significantly and difficulty in obtaining financing. He pointed out that the results were "very good," enabling Egypt to "restore its economic stability, reduce inflation, and increase foreign currency reserves."
He indicated that the second program was to address the repercussions of the COVID-19 pandemic, which caused a halt in tourism, navigation, and trade, noting the impact on "the lack of foreign currency resources and their severe damage."
He explained that the third and final program came with the inflation wave and the Russia-Ukraine war, amounting to $8 billion, noting that the total financing reached $28 billion, with about $12 billion initially, then $8 billion each for the rapid financing and the program during the COVID-19 period.
He emphasized that IMF programs primarily aim to help countries restore economic stability, which translates into lowering inflation, increasing foreign currency reserves, and reducing interest rates, debt, and its servicing.
Commenting on statements by Dr. Mostafa Madbouly, Prime Minister, that this is the last financing program with the IMF, he confirmed that the decision is a sovereign government decision, saying: "The government of any country is sovereign and decides what it sees in its interest regarding this matter."
He added that dealing with the IMF is "an exceptional matter, not a rule that continues indefinitely," saying: "When your circumstances require it and there is no alternative, you go to the IMF, but as long as your situation stabilizes and improves, why would you go?"
KEYWORDS
MENTIONED ENTITIES 4
Mohamed Maait
👤 Person_MaleExecutive Director and Representative of the Arab Group on the IMF Executive Board and former Minister of Finance
International Monetary Fund
🏛️ OrganizationInternational financial institution providing financing programs to countries
Mostafa Madbouly
👤 Person_MalePrime Minister of Egypt
Egypt
📍 Location_CountryArab country that implemented programs with the International Monetary Fund