Arab Finance: An International Monetary Fund (IMF) mission, led by Ivanna Vladkova Hollar, concluded its visit to Egypt on November 20^th following in-depth discussions with Egyptian authorities, the IMF announced in a statement.

The mission focused on the fourth review under the Extended Fund Facility (EFF) and broader economic reforms amid mounting regional and global challenges.

Discussions between IMF staff and Egyptian authorities will continue in the coming days to finalize policies and reforms necessary for the completion of the EFF’s fourth review.

Hollar highlighted the significant progress made in policy discussions.

Talks also encompassed Egypt's Article IV consultations, which analyze medium-term economic challenges and opportunities, as well as measures to address macro-critical risks tied to climate change. 

The mission underscored the complex external environment Egypt faces, exacerbated by geopolitical tensions in the Middle East.

Hollar stated that the ongoing Gaza-Israel conflict and trade disruptions in the Red Sea have caused sharp declines in Suez Canal revenues, down by as much as 70%, which is a vital foreign currency source.

Additionally, the influx of refugees is increasing pressure on public services, particularly in health and education, she added.

Despite these challenges, the IMF acknowledged steps taken by Egyptian authorities to stabilize the economy.

Promoting private sector development remains a priority for sustainable growth and job creation, according to the IMF.

Tax policy reforms were identified as crucial for increasing domestic revenue and creating fiscal space for essential expenditures, particularly in health, education, and social safety nets.

These reforms aim to broaden the tax base, reduce exemptions, and improve equity without increasing rates. Enhancing conditional cash transfer programs was also advised to mitigate the impact of rising living costs and energy prices on vulnerable groups.

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