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Help is on the way for Egypt's troubled economy through a series of multibillion-dollar loans and investments announced in recent weeks. Analysts, however, are adopting a wait-and-see attitude before proclaiming an end to a financial crisis exacerbated by fallout from the Israel-Hamas war.
Most notable is an eye-popping $35 billion investment from the United Arab Emirates, primarily focused on developing tourism facilities along the Mediterranean coast.
The commitment is seen as reflecting the UAE's confidence in Egypt's potential as a lucrative investment destination and underscores the strategic partnership between the two nations, experts said.
Also this month, the European Union announced an $8 billion package of grants and loans as part of a broader agreement aimed at addressing migration issues. The World Bank and International Monetary Fund have also pitched in since early March with loan packages totaling $14 billion.
Robert Mogielnicki, a senior resident scholar at the Arab Gulf States Institute in Washington, told VOA that the investments involve a mixture of opportunistic economic considerations and strategic political motivations.
As for the loans, he said these are a reflection of a country in desperate need of an economic lifeline, but also one that seems to be ready to undertake some painful reforms.
Egypt needed a large influx of investments to bolster confidence in its economy, encourage other investors, and build momentum in its negotiations for other forms of economic support, said Mogielnicki, a specialist in the political economy of the Middle East.
The UAE investment "is a big ... figure, but it's still quite early to determine the precise implications," he said. "It does reveal the enduring significance of Egypt-Gulf ties, especially those with the UAE.
"I'm not sure that long-term planning was a key component here. Moving forward, Egyptian policymakers will need to ensure that planned development projects are sustainable and possess clear benefits for the economy and Egyptian people."
In early March, the IMF announced it will extend an $8 billion rescue package to Egypt, which has seen a sharp drop in tourism revenue because of the Gaza war and reduced income from the Suez Canal because of Houthi attacks on Red Sea shipping.
According to the IMF, Egypt's pledged reforms include the implementation of a new exchange rate system, fiscal and monetary policy discipline, and initiatives aimed at attracting private sector engagement.
Egypt is presently grappling with an inflation rate of approximately 36%, prompting the IMF to call for "additional monetary policy tightening to reduce inflation, and [steps to] reverse the recent dollarization trend."
Mogielnicki said it is often remarked that Egypt is too big to fail but also too big to bail out. That means a number of internal and external actors and institutions are going to need to be involved in stabilizing Egypt's economy, supporting economic reforms, and guiding the country toward sustainable growth and development.
The World Bank, meanwhile, has committed $6 billion over three years, to be divided equally between public and private-sector support. The bank said its new programs will focus on "increasing opportunities for private sector participation in the economy" and "improving the efficiency and effectiveness of public resource management."
Despite these investments, Egypt grapples with a history of financial mismanagement and economic instability which has left many Egyptians anxious about the future, as reflected by a surge of speculation in gold.
Cairo resident Abdul Rahman Sayed told VOA that people like him do not see the country making economic progress. "On the contrary, we see the worst and the price increase continues and the value of the currency is still low. We do not know what the truth is."
Financial experts say the influx of money will not put Egypt on the path to economic revitalization without concerted efforts to address underlying structural issues and implement effective reforms.
David Lubin, a senior research fellow in the Global Economy and Finance Programme at London's Chatham House, told VOA that Egypt risks becoming overwhelmed with short-term speculative capital inflows.
These are economically useless because they are so easily reversible and make it more difficult for the Central Bank of Egypt to operate a proper floating exchange rate regime, he said.
"The inflow of this kind of speculative capital tends to exaggerate movements in the exchange rate beyond a level that's justified by Egypt's fundamentals," Lubin explained.
Lubin's advice is for Egyptian authorities to use taxes and regulatory tools to limit the inflow of speculative capital, perhaps by increasing the withholding tax, or requiring foreign investors to place part of their funds at the central bank as an unremunerated reserve requirement.
"This would help limit the inflow of speculative capital and make the [Egyptian currency] less volatile in the context of a flexible exchange rate regime," he said. "Introducing a flexible regime really is important, I think. For too long, Egyptian policymakers have thought that a 'stable country' requires a 'stable currency.' This is just plain wrong."