Amr Suleiman, professor of economics at the University of Helwan in Egypt, criticized the US policy towards the inflationary crisis and its adoption of a policy of raising interest rates.
In RT statements, he pointed out that this policy has harmed all countries of the world in general and developing countries in particular.
Suleiman emphasized that the countries of the world are paying for the US monetary policy by printing 12 trillion dollars in less than two years, which led to the spread of inflation around the world, stressing that all the developing countries of the world are paying the price of the irrational US policy in the context of the inflationary crisis.
He pointed out that the debt ratio, reaching 93 percent of Egypt’s gross domestic product, is a large and alarming number, but does not cause concern or danger, indicating that the ratio has reached higher levels than in the past, as it sometimes reached 107. % of gross domestic product.
A professor of economics at the Egyptian Helwan University pointed out that the consequences of the Ukrainian crisis that preceded the coronavirus pandemic, the food crisis, the increase in inflation and the subsequent increase in interest rates by the US Federal Bank and central banks in many countries of the world, debt ratios have increased.
He pointed out that the rising cost of debt has led to more debt accumulation and balance of payments and budget deficits.
Dr. Amr Suleiman added that what is happening to the Egyptian economy has become a natural phenomenon due to the successive crises that the world is witnessing, noting that this issue concerns not only Egypt, but all countries of the world.
He explained that the ability of the Egyptian government to reduce the debt ratio to 75% of GDP during 2026 depends on the measures the government takes, highlighting the importance of responding quickly to the launch of exchange rate flexibility, as having a flexible exchange rate and eliminating the parallel market will greatly help. attraction of foreign investments.
Dr. Amr Soliman added that the Egyptian government has been working to offer a number of companies for foreign investment to generate dollar revenues, but Egypt’s dollar revenues should be boosted by remittances from Egyptians abroad, income from the tourism sector, and also the Suez Canal and other other resources, especially since Egypt needs 10 years to talk about export volumes exceeding import volumes.
He emphasized that without a flexible exchange rate, there would be no foreign investment, pointing out that the last two quarters of the fiscal year, remittances from Egyptians abroad have declined, indicating that the dollar for Egyptians abroad is present in the Gulf markets, which attract these facilities.
And stressed that the Egyptian government has been pursuing a policy of devaluing the pound for the past year and a half without any flexibility in the exchange rate or floating rate, indicating that the Central Bank offers a price close to the parallel market, which corresponds to the high price in the parallel market, and the crisis is coming soon. will resume again.
He pointed out that the Central Bank should take two steps, firstly, launch a more flexible exchange rate close to the parallel market, while creating a permanent flexible mechanism to attract the supply of foreign currency, and secondly, provide savings vessels with high interest to attract citizens’ money.
With regard to the statement of the European Center and the US Federal Reserve System on the transition to a further increase in interest rates to curb inflation and its impact on the Egyptian economy. Dr. Amr Soliman, professor of economics at Egypt’s Helwan University, expressed his hope for the liberalization of a flexible exchange rate with the quality of a permanent mechanism that guarantees flexibility, away from previous measures, from devaluing the pound sterling to attract foreign investment, and eliminating the parallel market.
Source: RT