IMF Says Egypt Program Review Talks to Continue After ‘Progress’

(Bloomberg) -- The International Monetary Fund said it made “substantial progress” in discussions with Egypt on the latest review of the North Africa nation’s $8 billion program, although further talks are needed.

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“Discussions will continue over the coming days to finalize agreement on the remaining policies and reforms that could support the completion of the fourth review,” the Washington-based lender said Wednesday in a statement.

The comments came as an IMF mission concluded a roughly two-week visit to Egypt to observe the country’s enactment of its expanded program. Passing the latest review would unlock a $1.3 billion loan tranche.

The IMF and authorities agreed on “the importance of strengthening the social safety net,” including a cash transfer program, “to help protect vulnerable groups from the high cost of living and recent energy price increases, as well as mitigate the impact of tight policies,” according to the statement.

The IMF said it encouraged Egyptian officials to “accelerate their divestment plans, and to speed up reforms to level the playing field and reduce the state footprint in the economy.”

The lender also mentioned the central bank’s commitment to sustaining a flexible exchange-rate regime, and the importance of implementing tax reforms.

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