RIYADH: Egypt recorded the highest-ever foreign direct investment in a single quarter during July to September 2022, amounting to $3.3 billion, according to the country’s Prime Minister Mostafa Madbouly. 

The Prime Minister said in a press conference that the country recorded a 94 percent growth in foreign investment on a year-on-year basis.  

Foreign direct investments in Egypt during the last fiscal year, 2021-2022, reached the highest in 10 years amounting to $8.9 billion.  

Egypt’s economy has been experiencing turbulence ever since the Russian invasion of Ukraine resulting in a rise in oil and commodity prices.  

In December, the International Monetary Fund agreed to provide Egypt with $3 billion through a 46-month agreement within the Extended Fund Facility framework.  

The decision made it possible to disburse an immediate payment of $347 million to help meet the needs of the balance of payments and support the budget.  

The IMF expected the agreement to encourage investments into the country worth approximately $14 billion from international and regional partners including Gulf countries.  

Gulf allies pledged Egypt with $20 billion in deposits and investments to support the country’s economy.  

The Egyptian currency was devalued by 22 percent against the US dollar in January 2023, increasing losses to 93 percent over the preceding 12 months as a result of the IMF’s terms to leave the exchange rate of the local currency flexible.

“The permanent shift to a flexible exchange rate system will mitigate the severity of external shocks and prevent the re-emergence of imbalances and will allow monetary policy to focus on reducing inflation gradually,” Kristalina Georgieva, managing director of the IMF, said in a statement.  

She added that structural reforms will also help reduce the state’s footprint as well as ensure fair competition between the public and private sectors, promoting the private sector, and enhancing governance and transparency.  

Moreover, the IMF estimates that Egypt will face an external financing gap of $16 billion in the next 46 months.