RIYADH: Egypt has maintained financial stability despite spillovers from the war in the Middle East, supported by exchange rate adjustments and tighter macroeconomic policies, the International Monetary Fund said.
Speaking at a press briefing on April 15, IMF Managing Director Kristalina Georgieva said the country’s reforms have helped it absorb external pressures, even as regional tensions weigh on economic conditions.
Georgieva described the government’s response as “very responsible,” noting that policy measures were implemented alongside targeted social protection programs for vulnerable groups, helping to strengthen economic stability and leave the country better positioned to withstand shocks.
This comes on the back of S&P Global Ratings affirming Egypt’s sovereign credit ratings at “B/B” with a stable outlook earlier this week, citing strong momentum in macroeconomic reforms and improved external buffers.
“It is very rewarding to see how Egypt, having implemented difficult reforms, is now in a better position to face this shock,” she said, adding that the IMF is not currently discussing any augmentation of Egypt’s program.
The country has been affected by currency depreciation and higher domestic energy prices, but authorities have acted decisively to manage the impact, she said.
She noted that Egypt’s move toward greater exchange rate flexibility and tighter monetary and fiscal policies has been central to stabilizing the economy, while efforts to strengthen social safety nets have helped mitigate the impact on lower-income groups.
“This is a case when measures put in place are the right measures. They are a well‑targeted. We use the fact that we have built a well‑targeted social protection system in Egypt over the last years. And they are very well‑calibrated within the fiscal space Egypt has,” Georgieva added.
The IMF could review the program if conditions worsen, she said, but noted that Egypt stands out as an example of a country that has implemented difficult reforms and is managing external pressures effectively.
“But at this point, we see Egypt as one of the good examples of a country that has gone through difficult reforms, has built responsible policies, and is acting in a way that helps people that most need this help,” the IMF chief said.
