CAIRO: Egypt’s President Abdel Fattah al-Sisi warned on Sunday that regional challenges could lead to “unbearable” economic pressure on the population and a review of internationally-demanded economic reforms.
“If these challenges will make us put unbearable pressure on public opinion, then the situation must be reviewed with the IMF,” Sisi said at the Global Congress on Population, Health and Human Development in Cairo, as Egyptians brace for a new wave of inflation following fuel price hikes.
Egypt has been embroiled in economic crisis since 2022. Dominated by military-linked enterprises and for years focused on expensive infrastructure mega-projects, the economy is almost entirely reliant on imports.
Egyptian President Sisi sworn in for third term
Foreign debt has ballooned, the currency has undergone several devaluations, with a resultant rise in inflation.
The International Monetary Fund this year approved a $5 billion top-up to an agreed $3 billion loan for the Arab world’s most populous nation.
In turn, the Washington-based lender demanded wide-ranging reforms including shifting to a more flexible exchange rate, plans to boost the role of the private sector in the economy, as well as tackling high inflation and government debt, the IMF said.
In what he said was a “message to us and to the relevant international institutions, the IMF and the World Bank”, Sisi warned of persistent “challenges”.
His comments came two days after authorities announced new fuel hikes by up to 17 percent – the third increase this year as the government moves to lift fuel subsidies by the end of 2025.
The increases on Friday included hikes to the price of diesel and mazut, used in mass transport and industry. Public transport fares in the capital Cairo quickly went up in response.
Inflation peaked at nearly 40 percent last year, with the most recent figures in September at 26 percent.
Cairo has received three tranches of its IMF package. The IMF said earlier this month its next review mission, initially set for September, “is planned to take place in the coming months”.
Sisi said Egypt is “undertaking this (reform) programme in very difficult regional and global circumstances” which “must be taken into account”.
Alongside the economic crisis, Egypt has also been caught up in regional tensions, with wars raging in neighbouring Gaza and Sudan.
“We have lost $6-7 billion only in the past seven or eight or 10 months,” Sisi said Sunday, referring to Suez Canal revenues impacted by Yemen’s Iran-backed Huthi rebels. The Huthis have attacked shipping around the Red Sea in what they say is support for Palestinians in Gaza.