{"id":607144,"date":"2023-09-27T00:00:00","date_gmt":"2023-09-27T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/09\/27\/the-road-to-the-imf-review\/"},"modified":"2023-09-27T00:00:00","modified_gmt":"2023-09-27T00:00:00","slug":"the-road-to-the-imf-review","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/09\/27\/the-road-to-the-imf-review\/","title":{"rendered":"The road to the IMF review"},"content":{"rendered":"<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"> <strong> One thing off the IMF\u2019s checklist? <\/strong> The IMF is starting to believe the government is serious about its ambitions to sell down state assets, a change in sentiment that it says could ease the path towards the all-important review of our USD 3 bn loan program. That\u2019s according to an important piece by <a target=\"_blank\" href=\"https:\/\/www.bloomberg.com\/news\/articles\/2023-09-26\/egypt-s-election-race-adds-to-drama-around-imf-deal-devaluation?srnd=middle-east-politics\" style=\"\" rel=\"noopener\">Bloomberg<\/a> \u2019s Mirette Magdy, who reported yesterday that a number of recent agreements with Gulf and local investors have been met with a positive response from the Fund.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong> Remember: <\/strong>The IMF has postponed the first and second reviews of the reform program (originally scheduled for March and September) after we fell short of complying with key conditions of the loan, including an acceleration of the government\u2019s privatization plans as well as properly floating the EGP. Passing these two reviews would unlock almost USD 700 mn in fresh financing \u2014 and, perhaps most critically, provide a confidence-booster to investors that we\u2019re on the right track to exit the current economic crisis.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong> Cabinet has made important progress: <\/strong> The Madbouly government <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/1f59098e-47ac-42cc-964c-b84096549959\" style=\"\" rel=\"noopener\">announced in July<\/a> that it had agreed to sell a number of state-owned assets for USD 1.9 bn, some USD 1.6 bn of which would be paid for in foreign currency. Folks in government are confident that USD 800 mn of that will be received any day now when ADQ is <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/4915563f-21b9-4a89-8e3e-3ebe64b766ad\" style=\"\" rel=\"noopener\">expected to sign<\/a> final contracts to acquire stakes in three oil and chemical firms. More asset sales are expected in the coming weeks and months, with the <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/c50d8f15-1833-4d4d-8efa-15a7b5ced8bc\" style=\"\" rel=\"noopener\">Gabal El Zeit<\/a> and Zafarana wind farms, the military\u2019s <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/9326a491-9645-49df-b489-e36f40100021\" style=\"\" rel=\"noopener\">Wataniya and Safi<\/a>, and one of the <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/cfdc99d8-291f-4b7c-8af8-8e1cccc74de5\" style=\"\" rel=\"noopener\">Siemens combined-cycle power plants<\/a> all the subject of ongoing talks with prospective buyers.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong> Yes, but\u2026 <\/strong> In its ongoing talks with the government, the IMF is now focusing on what will happen with the currency and is trying to obtain more information about the government\u2019s expenditure on infrastructure projects. Under the program, the government committed to transitioning to a fully flexible exchange rate as well as slow infrastructure spending, which has been blamed on raising inflation, using up FX resources, and increasing national debt. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong> The election is a complicating factor: <\/strong> Authorities are unlikely to move to devalue the currency before the presidential vote, and even though this has been brought forward to December, there remains little time for the IMF to complete the review this year, Bloomberg says. Government officials have reportedly expressed confidence to the news outlet that a breakthrough can be made this year, though they didn\u2019t disclose any information about a potential devaluation.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong> A potential way forward: <\/strong> The two sides are reportedly discussing the idea of first signing off on a staff-level agreement and then devaluing the currency. That would allow the IMF\u2019s board to release USD that Hassan Abdalla and his team at the central bank would need to have on hand (alongside plenty more) to fight a potential overshoot during the float.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong> The caveat: <\/strong> The IMF is taking a harder line on FX flexibility this time around and is pushing officials to avoid a managed devaluation, according to Bloomberg\u2019s sources. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>The election is complicating the review, and is leaving little time for it to be completed before next year<\/p>\n","protected":false},"author":1,"featured_media":607145,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7206],"tags":[104,72,2234,272,587],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-607144","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","tag-economy","tag-enterpriseam","tag-foreign-exchange","tag-imf","tag-state-privatization-program","wpautop","entry"],"acf":{"mongo_id":"b61453cf-d237-48c5-9e6d-f0f9630ed8a1","order":"0","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2023\/9\/1609.jpg","photo_position":"above","homepage_title":"","full_issue_title":"IMF happy with Egypt\u2019s privatization progress \u2014 but sticking points on EGP, spending remain","related_issue":[607137],"teaser":"The election is complicating the review, and is leaving little time for it to be completed before next year","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2023\/9\/.5d061d81-0615-4b6f-8d20-69040910760c.mp3"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.1 (Yoast SEO v27.1.1) - 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PLUS: Abdalla on inflation","author":"enterpriseam admin","date":"18 April 2023","format":false,"excerpt":"Officials reportedly want to see privatization and a fully flexible exchange rate","rel":"","context":"In &quot;Economy&quot;","block_context":{"text":"Economy","link":"https:\/\/enterpriseam.com\/egypt\/category\/economy\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2023\/4\/644.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":562487,"url":"https:\/\/enterpriseam.com\/egypt\/2021\/05\/26\/imf-gives-initial-approval-for-final-tranche-of-usd-5-2-bn-standby-loan\/","url_meta":{"origin":607144,"position":3},"title":"IMF gives initial approval for final tranche of USD 5.2 bn standby loan","author":"enterpriseam admin","date":"26 May 2021","format":false,"excerpt":"Egypt expects to unlock the third and final USD 1.6 bn tranche of its USD 5.2 bn IMF standby loan after reaching a staff-level agreement with the fund, the IMF said in a statement. An IMF delegation was (virtually) in townover the past two weeks for the second review of\u2026","rel":"","context":"In &quot;Economy&quot;","block_context":{"text":"Economy","link":"https:\/\/enterpriseam.com\/egypt\/category\/economy\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2021\/5\/229.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":654513,"url":"https:\/\/enterpriseam.com\/egypt\/2024\/11\/04\/imf-to-begin-egypts-fourth-loan-review-tomorrow-more-from-imf-heads-visit\/","url_meta":{"origin":607144,"position":4},"title":"IMF to begin Egypt\u2019s fourth loan review tomorrow + more from IMF head\u2019s visit","author":"enterpriseam admin","date":"4 November 2024","format":false,"excerpt":"The Fund completed its third review of the country\u2019s loan program in late July","rel":"","context":"In &quot;Economy&quot;","block_context":{"text":"Economy","link":"https:\/\/enterpriseam.com\/egypt\/category\/economy\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2024\/11\/175.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":593659,"url":"https:\/\/enterpriseam.com\/egypt\/2019\/10\/07\/egypts-non-loan-imf-program-still-under-consideration-maait-tells-bloomberg\/","url_meta":{"origin":607144,"position":5},"title":"Egypt\u2019s non-loan IMF program still \u201cunder consideration,\u201d Maait tells Bloomberg","author":"enterpriseam admin","date":"7 October 2019","format":false,"excerpt":"Non-loan IMF program still under consideration but nothing conclusive yet -Maait: Egypt is still looking at securing a non-loan program with the IMF, but future cooperation with the fund could also continue \u201cunder any form,\u201d Finance Minister Mohamed Maait told Bloomberg TV on Thursday (watch, runtime: 2:47). The minister said\u2026","rel":"","context":"In &quot;Speed Round&quot;","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2019\/10\/262.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]}],"_links":{"self":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts\/607144","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/comments?post=607144"}],"version-history":[{"count":0,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts\/607144\/revisions"}],"acf:post":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/issue\/607137"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/media\/607145"}],"wp:attachment":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/media?parent=607144"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/categories?post=607144"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/tags?post=607144"},{"taxonomy":"brand","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/brand?post=607144"},{"taxonomy":"newspack_spnsrs_tax","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/newspack_spnsrs_tax?post=607144"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}