Egypt Watch

Despite financial crisis: Egyptian government intensifies work on Cairo Monorail

The Egyptian Minister of Transport, Kamel Al-Wazir, has said that the government is intensifying its work on the Cairo Monorail, which aims to link Greater Cairo with new cities. Although the country is facing a severe economic crisis, the government continues to work on costly mega projects. In April 2021, Egyptian President Abdel Fattah El-Sisi approved a €1.885 billion loan facilitated by JPMorgan Europe Limited, JPMorgan Chase & Co., and other financial institutions to finance the national project.

The International Monetary Fund (IMF) has said that Egypt’s external debt would rise to 39.6% of GDP in the current fiscal year, compared to 37.3% in the previous fiscal year. The IMF lowered its forecast for the growth of the Egyptian economy, expecting it to grow by only 4%. It also ruled out the recession of the inflation wave in Egypt soon, expecting inflation to decline to 7% in the fiscal year 2024-2025.

Head of Mission of the IMF in Egypt Ivana Holler estimated the country’s financing gap in the next four years at about $17 billion, expecting the IMF to contribute to supporting efforts to bridge the gap. The IMF expressed its confidence in Egypt’s ability to pay its debts, expecting them to decrease to 7% of foreign reserves by the end of the reform program it supports. On Tuesday, the Egyptian Central Agency for Public Mobilization and Statistics (CAPMAS) said that the annual inflation rate rose to 21.9%. This is the highest inflation rate in five years. According to CAPMAS, 75% of Egyptian families reduced spending on food by excluding higher-priced items, with about 95% of households reducing their consumption of meat, poultry and fish.