In a move intended to restore investor confidence and raise Egypt’s foreign reserves, the IMF (International Monetary Fund) executive board has approved a three-year bailout to Egypt totaling $12 billion.
FACTS:
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To qualify for the loan, the Egyptian government floated its currency and raised fuel prices
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The above reform led to price hikes
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The aim of the loan is to help Egypt “restore macroeconomic stability and promote inclusive growth.”
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A first installment of $2.75 billion has arrived Egypt according to Tarek Amer (Head of Egypt’s Central Bank)
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Egypt’s foreign reserve has now risen to to $23.5 billion due to the in flow.
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Tourism, Investment and business activity has stalled for a while in Egypt with inflation hitting 14 percent and unemployment about 13 percent.
CONCLUSION:
Egypt’s economy has been in shambles since 2011 after the ouster of President Hosni Mubarak, the IMF loan would come in handy as a last resort, after exhausting billions of dollars in aid from wealthy Gulf Arab nations recently humbled by declining oil prices — and now turned off by persistent bureaucratic hurdles to investing in Egypt.
