Publication: Egypt Economic Monitor, December 2022: Strengthening Resilience through Fiscal and Education Sector Reforms
Date
2022-12
ISSN
Published
2022-12
Author(s)
World Bank
Abstract
Amidst repercussions from the
Russia-Ukraine conflict, lingering supply chain disruptions,
and tightening global financial conditions, Egypt is
experiencing a spike in inflation and has suffered abrupt
large-scale portfolio outflows; adding pressures to the
country’s already stretched public finances and external
accounts. The Central Bank of Egypt (CBE) has undertaken
exchange rate and monetary policy adjustments since March
2022 by allowing the exchange rate to depreciate and by
raising key policy rates, in order to contain the widening
trade deficit, capital reversal and the ensuing drop in
foreign exchange buffers. In tandem, the government
announced social mitigation packages. The authorities’
efforts to restore macroeconomic stability, rebuild
reserves, and push ahead with structural reforms is
supported by the 46-month International Monetary Fund (IMF)
program, along with other multilateral and bilateral
financing and investments. This report provides an update on
the recent economic developments and outlook of the Egyptian
economy, while embedding the analysis in long-standing
challenges. It also features a Special Focus on Education
Sector reforms that draws on the World Bank Egypt Public
Expenditure Review for Human Development Sectors. A key
message is that education spending, its efficiency, and the
overall learning outcomes require improvements in order to
meet the needs for robust human development, poverty
reduction, improved equity, and long-term growth. According
to the report, there are three key (inter-connected)
priorities going forward: (1) establishing sustained
macroeconomic stability and enhancing the competitiveness of
Egyptian economy to ensure resilient sources of foreign
income activities (exports and FDI). This requires
continuing to push ahead with business environment reforms;
(2) streamlining budgetary and off-budget expenditures and
increasing revenues to create the fiscal space required to
allocate more resources for priority areas (such as the
education sector); and (3) unleashing the private sector’s
potential in higher value-added and export-oriented
activities to create jobs and improve living standards.
Citation
“World Bank. 2022. Egypt Economic Monitor, December 2022: Strengthening Resilience through Fiscal and Education Sector Reforms. © Washington, DC: World Bank. http://hdl.handle.net/10986/38457 License: CC BY 3.0 IGO.”