IMF says Egypt’s structural reforms key for sustainable development

Egypt’s inflation, which had soared to a record high of more than 33 percent in July 2017, eased to its lowest level in almost two years in May. (AFP)
Updated 24 September 2018
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IMF says Egypt’s structural reforms key for sustainable development

  • Egypt has implemented tough reforms under a $12 billion loan program agreed in late 2016
  • Egypt’s inflation eased to its lowest level in almost two years in May
CAIRO: IMF managing director Christine Lagarde has praised Egypt’s economy saying it was showing “strong signs of recovery” under a three-year reform plan, and stressed the importance of structural reforms to achieve more sustainable development.
Egypt has implemented tough reforms under a $12 billion loan program agreed in late 2016 that involved deep cuts to energy subsidies, new taxes, and a floated currency in a bid to draw back investors who fled after its 2011 uprising.
Financial markets have been closely watching how the government keeps to the terms of the deal, which has helped Cairo receive loan installments on schedule.
In a statement after she met with Egyptian President Abdel Fattah El-Sisi in New York on Sunday, Lagarde said the IMF remained committed to supporting Egypt.
“Egypt’s economy is showing strong signs of recovery, and its economic growth is among the highest in the Middle East,” Lagarde said in the September 23 statement.
She said she agreed with El-Sisi on the importance of capitalizing on Egypt’s “macroeconomic gains to advance the authorities’ home-grown structural reforms.”
“These reforms will help achieve more sustainable, inclusive and private-sector led growth which will help create jobs for Egypt’s young population, while also ensuring adequate resources are available for social protection,” she added, according to the statement.
Egypt’s inflation, which had soared to a record high of more than 33 percent in July 2017 after the import-dependent country floated the Egyptian pound in November 2016, eased to its lowest level in almost two years in May.
Core inflation in August stood at 8.83 percent while foreign reserves reached $44.419 billion compared with $36.143 billion in the same month last year.
Egypt in June raised fuel and electricity prices as part of the reforms agreed under the IMF plan in measures that had made it harder for ordinary Egyptians to make ends meet. Another fuel price rise is scheduled next year.


Israel army accuses Hamas of firing rocket, new troops headed for Gaza

Updated 23 min 28 sec ago
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Israel army accuses Hamas of firing rocket, new troops headed for Gaza

  • Netanyahu said the incident will evoke a strong Israeli reaction
  • Palestinian rockets rarely reach an area at that distance from Gaza

MISHMERET/JERUSALEM: Israel’s military accused Hamas of carrying out a rocket strike from the Gaza Strip on Monday, and said they were sending two additional brigades to the area around the Hamas-run enclave and will carry out a limited call up of reservists..

The Israeli military said on Twitter the rocket had been fired from the Rafah area in the southern Gaza Strip. Major Mika Lifshitz, a military spokesperson, says two armor and infantry brigades were being mobilized and that there is a limited drafting of reserves underway following the attack.

 

Israeli Prime Minister Benjamin Netanyahu also on Monday said that he is to cut short his trip to the United States after a rocket attack near Tel Aviv.

“In light of the security events I decided to cut short my visit to the US,” Netanyahu said, calling the attack a heinous crime that would draw a strong Israeli response.

He said he would meet with President Donald Trump in the coming hours and then fly back immediately.

A rocket fired from the Gaza Strip hit a house in a community north of Tel Aviv and caused it to catch fire, wounding seven Israelis, authorities and medics said.

Israel’s army said the rocket was fired from the Palestinian enclave run by Islamist movement Hamas, raising the risk of another escalation between the two sides just ahead of April 9 Israeli elections.

The house hit was located in the community of Mishmeret, police said. Medics said they were treating one Israeli with moderate wounds and four others injured lightly.

Mishmeret is more than 80 kilometers from the Gaza Strip and rocket fire from the Palestinian enclave at that distance is rare.

Monday’s incident comes after two rockets were fired from Gaza toward Tel Aviv — also rare — on March 14.

No damage or injuries were caused, but Israel responded to that and further rocket fire by hitting what it said were around 100 Hamas targets across the Gaza Strip.

Four Palestinians were reported wounded in those strikes.

Both Hamas and its ally Islamic Jihad denied they were behind the March 14 rocket fire toward Tel Aviv, raising the possibility they were launched by fringe groups.

Israel’s military said they were launched by Hamas, but later there were Israeli media reports that the army’s preliminary assessment was that they had been fired by mistake during maintenance work.

The reports were a sign that Israel was seeking to calm tensions. The military had refused to comment on the reports at the time.

Monday’s rocket comes just days ahead of the March 30 one-year anniversary of Palestinian protests and clashes along the Gaza Strip’s border with Israel.

An informal truce between Hamas and Israel had led to relative calm along the border of the blockaded strip, but recent weeks have seen another uptick in violence.