RIYADH: The International Monetary Fund’s commitment to supporting Egypt’s economic reforms will remain a priority, despite external pressures, according to managing director Kristalina Georgieva.
Speaking in an interview with Asharq on the sidelines of the AlUla Conference for Emerging Market Economies, Georgieva reaffirmed the IMF’s stance, emphasizing that political considerations fall outside its mandate.
This comes on the back of Egypt’s ongoing 46-month IMF loan program, which was initially approved in 2022 and expanded to $8 billion in 2024 amid an economic crisis marked by soaring inflation and acute foreign currency shortages.
Georgieva acknowledged that Egypt faces economic headwinds, exacerbated by regional instability, including recent geopolitical tensions.
“Egypt has been going through some difficult times because of the events in the region. We know that just the loss of revenues from the Suez Canal are hitting the fiscal position of Egypt significantly,” she said.
She highlighted the necessity of structural reforms aimed at enhancing competitiveness and strengthening private sector participation.
“I want to express my respect for some of the key brave steps that they have taken, for example, letting the exchange rate reflect market conditions, moving forward with a privatization program, being very keen on reducing subsidies so the country can be in a stronger position,” she said.
“Of course, the more the government does what is necessary, the stronger the position of Egypt. We are looking at the progress today. And, actually, our board will soon discuss the second review of the program,” she added.
When asked whether the IMF would remain committed to Egypt regardless of any external pressures, Georgieva was firm in her response.
“We look at the macro position of a country, and we concentrate on the economy. There are matters of politics that are not in our domain. We are not the best institution to comment on that. So I can confirm that for the fund to support the Egyptian economy in the path of reforms, this is and will remain a priority,” she said.
Discussing the next steps in the IMF’s program with Egypt, Georgieva said, “We will be presenting, as you know, we will be presenting the outcome of the review to our board of directors. There will be a discussion and a decision then taken by the board as management.”
She emphasized that the IMF has remained engaged with Egyptian authorities despite the rapidly changing global environment. “This is an environment of rapid change, not just in Egypt, everywhere in the world. So we remain very engaged so we can get to a point of board discussion. And it is a matter of schedule,” she said.
Engagement with Syria
Addressing Syria’s engagement with the IMF, Georgieva noted that the institution’s involvement had been “unfortunately interrupted” since 2009.
“Even more unfortunate is what happened to the Syrian people. For far too long, they have suffered the consequences of a civil war. And we are very much praying that there would be a new page turned for Syria," she said.
Georgieva confirmed that engagement at the staff level has resumed to address significant gaps in economic data.
“There is already indication of the key institutions like the central bank that they would be looking for support to build institutional strength of Syria so it can function well for the benefit of the economy and the benefit of people,” she said.
When asked about the timeline for potential IMF assistance to Syria, Georgieva emphasized that the speed of engagement depends on Syrian authorities.
“I was very encouraged to learn from my staff that first contacts have already taken place. And, as far as we are concerned, we stand ready to support Syria. It is a very important country for its own people, and you know very well it is also very important for the whole region. So as quickly as the conditions allow, that quickly we would move,” she said.
Organized by the IMF and Saudi Arabia, the high-level annual conference in AlUla brings together finance ministers, central bank governors, policymakers, and leaders from the public and private sectors. The two-day event serves as a platform to discuss global economic challenges and pathways for emerging markets.
During the interview, Georgieva highlighted the significance of the AlUla Conference, noting that it marks the first time emerging markets have gathered to discuss policy issues of shared interest.
“We have over 70 central bank governors, ministers of finance, and representatives of international organizations gathering here,” she added.
"The agenda is very interesting. All the topics you cover are being discussed today and tomorrow. Well, we hope it is a successful conference, and we are looking forward to the additions next year and so forth," she added.
