Egypt has asked for the International Monetary Fund’s support to implement a comprehensive economic programme, the IMF said on Wednesday.
Continued exchange rate flexibility would be essential to absorb external shocks, it saidin a statement.
The IMF is working closely with Egyptian authorities to prepare for discussions with a view to supporting sustainable, job-rich and inclusive growth, it added.
The new programme could entail additional IMF funding, an Egyptian Cabinet spokesman said in a separate statement.
Egypt is under new economic pressure following Russia’s invasion of Ukraine, which prompted foreign investors to flee emerging markets.
On Monday the government let the Egyptian pound depreciate by 14% after it had remained little changed since November 2020. On Wednesday, the currency appreciated slightly to 18.32 pounds to the dollar.
Russia and Ukraine were the main exporters of wheat to Egypt – typically the world’s top importer – and major sources of tourism.
“The rapidly changing global environment and spillovers related to the war in Ukraine are posing important challenges for countries around the world, including Egypt,” the IMF said.
By Reuters