CAIRO: Minister of Finance Youssef Boutros Ghali expected inflation rates to return back to a natural level over the next few months after neutralization of the impacts of global energy prices.
During his meeting Monday with a group of US business people in Cairo, the minister stated that global energy prices had pushed the inflation rate up to 12 percent over the past few months, rejecting claims that inflation surged as a result of domestic factors.
He added that Egypt received over $3 billion (LE 17 billion) of Foreign Direct Investments during the first quarter of fiscal year 2006-7 as a result of the government’s recent legal and economic reforms.
“The amendment of taxation laws has increased revenues by as much as 17 percent, Ghali noted.
The Minister of Finance criticized the ranking of Egypt as low as 165 in the WB Business Climate index, noting that the ranking relied on unrealistic paperwork criteria.
“Egypt was ranked lower than many countries that were less stable, such as Iraq (145), Sudan (154) and Afghanistan (162), he argued.
He pointed out that Egypt has implemented Article 8 of the IMF agreement which grants full freedom of movement to capital. “This reflects the government confidence in continued capital inflows without fears of capital flight, he concluded.