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Arab Monetary Fund lends over $615m to Egypt to support banking reforms

August 1, 2023 at 8:10 am

Central Bank of Egypt Governor Hassan Abdalla during the annual meetings plenary of the IMF and the World Bank Group annual meeting at the IMF headquarters in Washington, DC, on October 14, 2022 [BRENDAN SMIALOWSKI/AFP via Getty Images]

The Arab Monetary Fund (AMF) has agreed to extend a new loan of $615.8 million to Egypt, making it the latest such loan to the North African country.

Signed last week Tuesday by the Central Bank of Egypt’s Governor, Hassan Abdalla, and the AMF Director-General Chairman, Abdulrahman Al-Hamidy, the agreement for the new loan reportedly aims to support Egypt’s reforms in its banking sector.

According to the AMF, the agreement focuses on improving the efficiency of Egypt’s payment system, the enhancement of economic inclusion and the strengthening of the regulatory framework in the country’s financial and banking sectors. The loan also aims to expand the scope of financial technologies and strengthen consumer protection.

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Egyptian Central Bank Governor, Abdalla, stated that the fund helps to strengthen Arab countries in maintaining their economic and financial stability amid challenges in various sectors, and AMF Chairman, Al-Hamidy, acknowledged efforts by the Egyptian government to implement a series of economic and structural reforms.

Those reforms, Al-Hamidy said, are set to contribute to the further development of Egypt’s economy while helping it sustain itself in regional and global markets. He also insisted that the AMF is determined to pursue its “fruitful partnership” with Cairo in order to help the government address the various challenges it is facing.

The $615.8 million loan is the latest such provision of funds to Cairo in an effort to keep its economy afloat, others of which have been provided by the International Monetary Fund (IMF) and the Gulf Arab states.

There are a myriad of concerns voiced by critics of Egypt’s handling of those funds over the past decade, however, with the IMF chief remarking in June that giving money to Egypt is like “putting water in a bucket that has holes”.

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