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Egypt’s Al-Mashat outlines economic reforms amidst global challenges at World Bank Spring Meetings – Dailynewsegypt

Rania Al-Mashat, Egypt’s Minister of International Cooperation and Governor at the World Bank Group, participated in a live discussion with the Atlantic Council during the IMF and World Bank Spring Meetings. The discussion focused on Egypt’s economic reform plans and its efforts to navigate a challenging global environment.

Al-Mashat acknowledged the widespread impact of global challenges, including the COVID-19 pandemic, geopolitical tensions, supply chain disruptions, and rising prices. These factors have disproportionately affected developing and emerging economies, leading to capital flight and declining foreign direct investment.

In response, Al-Mashat outlined Egypt’s multi-pronged approach to economic reform. This strategy focuses on both macroeconomic stability and structural reforms. A key element is the liberalization of the exchange rate, implemented alongside an ongoing IMF program.

The Ministry of International Cooperation, in collaboration with other government bodies, is actively engaging multilateral and bilateral development partners. This collaboration aims to support structural reforms through budget programs and development policy financing. The focus areas are threefold:

• Maintaining macro-fiscal stability
• Enhancing the business environment and economic competitiveness
• Supporting the green transition

Al-Mashat emphasized the coordinated effort with development partners, including the World Bank Group, the European Union, and other bilateral entities.

The recent visit by the European Commission President to Egypt signifies a deepened partnership. This includes a €1.8bn package of investment guarantees to bolster the private sector, alongside €600m in development grants and additional financing for the state budget (under finalization).

A critical aspect of Egypt’s reform plans is the emphasis on social safety nets. These programs aim to protect vulnerable populations most impacted by the reforms.

Development Financing Landscape:

Al-Mashat highlighted Egypt’s extensive development financing portfolio, currently valued at approximately $26bn. Over the past four years (2020-2023), the country secured $37bn in financing from development partners, with $10.3bn specifically directed towards the private sector.

Concessional financing, with its attractive terms, remains a competitive area for developing countries.

Al-Mashat emphasized Egypt’s strong partnerships, which are instrumental in driving economic growth and development.

The launch of the National Water Food and Energy (NWFE) program country platform was another key point. This initiative focuses on nine priority projects and aims to attract foreign direct investment for implementing the National Climate Change Strategy 2050. It leverages various financing options, including blended finance, debt-for-nature swaps, and development grants.

The Egyptian vision for the future prioritizes a strong private sector as the engine of development, job creation, and sustainable growth. A collaborative study with the World Bank on foreign direct investment in Egypt is nearing completion.

Al-Mashat reaffirmed Egypt’s commitment to strengthening multilateral institutions’ capacity to support developing and emerging economies. This underscores the importance of international cooperation in tackling global challenges and achieving sustainable development goals.

Al-Mashat indicated that the Egyptian Cabinet, headed by Mostafa Madbouly, had approved Egypt’s subscription to the IFC capital increase, by IFC Board of Governors Resolution No. 272 of 2018, intending to maintain the amount of Egypt’s shares of shares; thus ensuring its voting power within the institution, knowing that the institution is increasing its financial resources to increase the provision of funds directed to private sector investments.