But with the spread on Egyptian bonds skyrocketing, the country has effectively been shut out of international financial markets. The IMF program is expected to catalyze funding of up to USD 17 billion over three years to help cover Egypt’s financing gap, pending economic reforms. One lesson from Egypt’s current economic travails is that capital markets alone cannot help developing countries contain external or internal shocks. Another lesson from Egypt’s experience is that international financial institutions have a critical role to play in mitigating the consequences of such capital-flow volatility. The IMF’s bailout of Egypt represents a golden opportunity to break the country’s vicious boom-and-bust cycle and ensure shared prosperity for all Egyptians.

Source: Ethiopian News January 21, 2023 18:33 UTC