The World Bank (WB) has announced the allocation of $700 million to Egypt to help address the country’s budget deficit. This information was released in a press statement from the organization.
According to the WB, the aim of the financial support is to implement key reforms focused on stimulating private sector growth, strengthening the overall economic situation, addressing the budget deficit, and transitioning to an environmentally sustainable development model. "The reforms supported by this initiative are an important step towards creating a more sustainable and inclusive economy in Egypt," said Stefan G. Goh, the World Bank’s Director for Egypt, Yemen, and Djibouti, as quoted by the press service.
The country received this financial assistance as part of a funding program that the WB adopted in March this year. The project includes providing Egypt with $6 billion over the next three years, with half of the funds dedicated to the development of the public sector and the other half to the private sector.
External financing became necessary for the Egyptian government after the country faced a shortage of foreign currency in 2022. This situation led to the devaluation of the Egyptian pound, record inflation rates, reduced imports, and a decline in overall economic activity. In March 2024, Egypt had to devalue its currency to stabilize the economy and attract foreign capital. Additional financial assistance was provided by the International Monetary Fund ($8 billion), the EU (€7.4 billion), and the US ($1.43 billion in 2023 and $1.44 billion in 2024).
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Based on materials from TASS