By CultureBanx Team
The World Bank and Egypt signed a $1B private sector agreement
Economic reforms in Egypt have helped increase growth to 5.3% in 2018
The World Bank and Egypt signed a $1 billion agreement to spur the country’s private sector. By supporting small businesses, the country’s largest source of jobs, Egypt’s government hopes to bring about sustainable economic reform from this second phase of support.
Why This Matters: Egypt’s economy is weighed down by a legacy of heavy bureaucracy and a lack of transparency which deters investors. However, this funding is intended to support the next phase of the country’s reform program and finance the government’s economic development program, “Egypt Takes Off”.
Currently, the World Bank has 16 projects in Egypt worth a total of $6.69 billion. This deal is part of a broader package of support by the World Bank to Egypt, while ensuring public funds are properly reallocated to build human capital.
“Our aim is to create more and better opportunities for Egyptians, and promote inclusive and sustainable development; our partnership with the World Bank is accelerating our efforts towards that goal,” said Dr. Sahar Nasr, Egypt’s Minister of International Cooperation.
Egypt has pushed ahead with a series of economic reforms tied to a $12 billion International Monetary Fund loan program aimed at reviving the economy and plugging a budget deficit. Economic reforms in Egypt have helped increase growth in the country from 4.2% in 2017 to 5.3% in 2018. Expectations are for growth to climb six percent this year.
Situational Awareness: Some of the reforms have strained ordinary Egyptians, tens of millions of whom live under the poverty line. An estimated 700,000 people join the labor market each year and this is one of the challenges the World Bank’s financial support is meant to address.
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