Egypt is discussing the second phase of structural reforms with the World Bank AIIB

Minister for International Cooperation Rania Al-Mashat – press photo

CAIRO – April 20, 2021: The Ministry of International Cooperation held the first meeting on Sunday with multilateral and bilateral development partners on new structural reforms that the Egyptian government plans to implement in 2020/2021.

In a statement, the ministry made it clear that the meeting was taking place within the framework of the government’s negotiations with the World Bank Group (WBG) and the Asian Infrastructure Investment Bank (AIIB) on development finance to support the state budget.

The meeting was attended by representatives of several multilateral and bilateral development partners, including the WBG, the AIIB, the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and the US Agency for International Development (USAID). among other things according to the statement.

The meeting is in the light of the Ministry’s doctrine of economic diplomacy as part of its mission to develop and strengthen economic cooperation between the Arab Republic of Egypt and other countries and international and regional organizations.

The Ministry is responsible for proposing the criteria for raising external funding, both for funding and for grants. Follow-up and monitoring of ministries and national agencies benefiting from external funding as part of the general economic policy of the country to ensure the achievement of economic development goals; and manage Egypt’s economic relations with international economic cooperation organizations, the international financial institutions and specialized agencies of the United Nations – all to achieve a circular economy and implement the national development agenda.

The Minister for International Cooperation, Rania A. Al-Mashat, gave a speech in which she welcomed the participants and development partners. During the speech, she stressed the importance of the structural reforms that the Egyptian government intends to implement in order to achieve sustainable economic recovery and face future challenges.

Al-Mashat highlighted Egypt’s success in implementing its domestic economic reform program from 2016 to 2019, which helped cushion the country during the pandemic, improve development plans and achieve positive growth rates despite recessions in most countries around the world.

She added that the proposed structural reforms are part of the complement of the reform process that the Egyptian government initiated in 2016 with the International Monetary Fund (IMF) in the financial and monetary sector. The second phase of structural reforms this year focuses on sectoral structural reforms.

The minister thanked all ministers, technical working groups of the ministries concerned and the WBG team who worked diligently to work out the framework for structural reforms in its final form. The involvement of all companies concerned in the creation of an appropriate framework for development finance to support the budget reflects the willingness of the Egyptian government to implement development plans and opens new horizons for the participation of International Financial Institutions (IFIs) and foreign investment. It also reflects the government’s commitment to aligning project goals and funding for concession developments with the Sustainable Development Goals (SDGs).

Marina Wes, the WBG’s country director for Egypt, Yemen and Djibouti, said the ongoing dialogue between the WBG and its partners, including government, civil society, the private sector and international partners, is at the heart of the bank’s work. She added that the first phase of economic reforms ensured economic resilience and the second phase is expected to help Egypt recover from the effects of the pandemic through private sector-led development efforts.

GP Zhang, Senior Investment Operations Specialist at AIIB, stressed that the development policy funding program in support of the Egyptian budget is an important process to advance the government’s response and reform plans to the COVID-19 pandemic. He added that it is also critical that the economic recovery be comprehensive and sustainable. Zhang expressed the AIIB’s appreciation for the trust the Egyptian government has placed in the bank to fund the process.

Said A. Bakhache, Egypt’s senior representative at the IMF, also praised Egypt’s ability to weather the COVID-19 crisis. He stressed the IMF’s support for all efforts to gain access to budget support funding and noted that the program was a means of developing the economy.

Elena Panova, Egypt-based UN coordinator, congratulated the Ministry of International Cooperation, WBG and AIIB on the development funding program, which focuses on accelerating the SDGs through empowering women and engaging the private sector in development plans. Panova said the United Nations is ready to support the development policy funding program through ongoing partnerships with the government to align the SDGs with the second phase of reform.

The meeting is the first in a series of discussions to discuss the proposed structural reforms in the light of the Development Funding Program with multilateral and bilateral development partners, the private sector and civil society organizations. The Development Funding Program is one of the funding mechanisms initiated by the WBG to help countries achieve development outcomes by supporting political and institutional reforms through funding the state budget. These programs aim to achieve a number of benefits, including improving macro-fiscal sustainability, enabling the private sector to develop in sustainable energy, and improving the business climate.

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