Egypt’s external position still not sustainable

An influx of financing from the Gulf since last summer has eased strains in Egypt’s balance of payments and brought the country back from the brink of a crisis. Nonetheless, this situation isn’t sustainable over a longer horizon. Eventually, the Egyptian authorities will need to implement reforms to attract private foreign capital back to the country. In this regard, we remain of the view that an agreement with the IMF would be the best option for Egypt.