CAIRO — On Tuesday, the International Monetary Fund (IMF) announced the completion of its fourth evaluation of Egypt’s economic reform agenda, leading to the approval of a $1.2 billion installment for the country.
The announcement follows the IMF’s statement that it had concluded the review on Monday, allowing Egyptian officials to access the funds right away. Moreover, the IMF executive board granted Egypt’s appeal for a setup under the Resilience and Sustainability Facility, which provides an extra $1.3 billion in funds.
Residents of Egypt are currently facing skyrocketing inflation rates, as rising living expenses surged to new heights last year. Contributing factors include increased fuel costs, higher subway fares, and the depreciation of the Egyptian pound relative to other currencies. A recent initiative by the government to raise the minimum monthly salary is anticipated to offer some level of alleviation.
Finance Minister Ahmed Kouchouk announced last month that starting in July, the minimum wage for public sector employees will rise to EGP 7,000 ($138), from the current EGP 6,000 ($118.58). This adjustment seeks uniformity with the private sector, where the minimum wage increase was implemented on March 1. The wage hike is part of the government’s broader social protection framework.
In October, Egypt experienced a fuel price hike ranging from 10% to 17%, a step anticipated to influence the prices of both goods and services. The price for a liter of diesel, which is extensively used for public transportation, rose from 11.5 pounds ($0.23) to 13.5 pounds ($0.25), while 92-octane gasoline’s price increased to 15.25 pounds ($0.31) from 13.75 pounds ($0.28).
In the previous spring, Egypt arranged an agreement with the IMF to more than double the amount of its bailout to reach $8 billion. These price increases are deemed essential to satisfy the IMF’s conditions for additional assistance to the nation.
