Egypt: Reforms must focus on investment, World Bank says

BEIRUT – Egypt needs to implement economic reforms aimed at encouraging more private investment and moving away from subsidies towards targeted transfers for the poor, a senior World Bank official said on Wednesday.

Hafez Ghanem, the World Bank’s vice president for the Middle East and North Africa, told Reuters in an interview that Cairo’s next set of economic reforms should focus on making its bureaucracy more transparent for investors.

Such reforms are important as part of a wider transition across the Middle East away from a social model based on free government handouts to one more dependent on private sector development, Ghanem said.

He added that the appointment of a new government in Lebanon had eased political gridlock and said he believed donors were still committed to tackling Syria’s refugee crisis despite a shift towards economic nationalism in some western countries.

The World Bank said in December that its board had approved the second $1 billion tranche of a $3 billion loan package to Egypt. Ghanem told Reuters he expected to work with Cairo towards approving the third tranche near the end of this year.

“We need to see a big increase in private investment, and not just private investment by big companies, big ticket items. We need to see encouragement for SMEs, for young people to develop more entrepreneurship,” he said.

“The next set of reforms need to focus on the micro level, regulatory reforms, making the system more transparent, easier for investors to come and invest in Egypt,” he added.

He also praised Egypt’s reforms so far.

Source: Angola Press News Agency