Ziyad Bahaa El-Din, former Egyptian Deputy Prime Minister, confirmed in article He told the Financial Times that the Egyptian government is required to adopt a comprehensive economic reform program, and follow up on its implementation, to convince international rating agencies and skeptical international investors to change conditions for the better, and to attract their attention to Egypt.
Bahauddin added that the government had previously announced a few days ago a comprehensive package of measures encouraging investment, including reducing bureaucratic obstacles, providing guarantees for fair competition with the state, and clarifying tax details.
He stated that these measures are positive and very welcome, but changing the course of the economy will require much more measures and decisions than just facilitating the issuance of permits, or providing tax exemptions.
The writer talked about the downgrading of Egypt’s credit rating by Fitch, for the first time in a decade, for reasons including the government’s failure to approve radical reforms, as well as the country’s high external debt requirements, restrictions on obtaining financing, and the deterioration of public debt “metrics”.
Bahaa El-Din said that the justifications cited by the government in its opposition to the “Fitch” report for explaining the economic crisis as the repercussions of the “Covid-19” pandemic, and Russia’s war on Ukraine, are no longer acceptable justifications by most analysts and independent observers.
He explained that they expressed their concern about the continued denial of other major causes of the crisis, such as excessive spending on long-term infrastructure projects, the lack of rationalization of domestic and international borrowing, in addition to the unprecedented growth of state intervention in the economy, and the presence of a powerful bureaucracy.
He emphasized that acknowledging the mistakes of previous policy is a necessary condition for embarking on the desired comprehensive reform, developing an economy that officially witnessed inflation that reached 40%, a booming black market in the field of currency, and import restrictions that affected productive capacities, at a time when debts – which have reached dangerous levels – are overburdened. state burden.