Executive Director at the International Monetary Fund Mahmoud Mohieldin discusses inflation effect on international economy in a panel discussion with Al Siyassa Al Dawliya magazine, 23 January 2022. Al-Ahram
Mohieldin, who is also the UN Special Envoy on Financing the 2030 Agenda for Sustainable Development, also highlighted the successes made by the Egyptian economy prior to the coronavirus pandemic.
Mohieldin highlighted the positive economic growth maintained by Egypt at a time when the economies of many countries have been severely affected by the pandemic.
Egypt has achieved growth rates that exceed many of the Arab oil producers, Mohieldin said, adding that increasing the Egyptian economy’s growth rates requires investment and savings in different ways.
Despite the coronavirus pandemic’s impacts, the Egyptian economy maintained a positive GDP growth in FY2020/21 at 3.3 percent. Egypt targets a 5.7 percent GDP growth in FY 2022/23 and 6 percent in FY 2024/25.
Egypt’s exports increased by 27 percent in 2021 and recorded EGP 31 billion, the country’s largest export volume in its economic history, a presidential statement said early in January.
Mohieldin affirmed the need for countries to take pre-emptive policies to prevent inflation and pump additional investments to improve education and medical care and support medium-income citizens to ease inflation.
The state of global inflation will have significant effects on the countries of the region, which are affected by the mechanisms of imported inflation, Mohieldin said.
He added that the monetary policy measures abroad to deal with global inflation will have repercussions on the financial flows of the economies of the region and debt markets.
Also, there will be repercussions to the rise in dollar interest rates during the next two years, Mohieldin said, expecting consecutive future rises in dollar interest rates by 1.75-2 percent to have global effects on flows of trillions of dollars to many countries of the region.