Egypt’s Minister of Planning and Economic Development Hala El-Said has presented proposals to help developing and medium-growth countries confront the novel coronavirus (COVID-19) crisis, guided by the Egyptian experience.
The minister’s presentation came on the sidelines of her participation in a United Nations (UN) organised meeting to discuss financing in the coronavirus period. The meeting, entitled “Financing for Development in the Era of COVID-19 and Beyond”, hosted the presence of representatives from 40 countries.
El-Said showcased the Egyptian state’s efforts in dealing with the pandemic, stressing that the state was keen on transparency and conveying the facts in full to its citizens as partners in managing the crisis.
The minister pointed out that Egypt’s keenness on transparency in managing the crisis is evident through the large number of meetings that were held by the government. These were convened to present the latest developments to the country, and to strengthen citizen confidence in the measures undertaken by the government.
During the meeting, El-Said indicated that several international institutions have praised the efforts made by the Egyptian government in dealing with the coronavirus crisis. She noted that the Egyptian state has performed well in all sectors during this unprecedented crisis.
Guided by the Egyptian experience, El-Said presented some proposals to help developing and medium-growth countries, pointing out that most developing countries were stuck with high levels of debt and facing financing challenges even before the crisis.
The minister highlighted the need for innovative financing mechanisms, such as green bonds, and the establishment of various types of sovereign wealth funds. She noted the need for global support to the debt relief mechanism, through expanding debt swap to finance the investments needed to achieve the sustainable development goals.
“We also need to establish a global or regional solidarity fund, and take into account support for countries that have been severely affected by the pandemic, especially countries that are dependent on foreign currencies and have weak resources,” El-Said explained.
Concerning workers’ remittances, El-Said added that, in some middle-income countries, they represent about 40% of foreign exchange sources. She also noted the importance of continued employment to reduce the cost of remittances to a minimum.
“There is a need to focus in particular on supporting the informal sector, as it represents, for example in Egypt, about 45% of the volume of employment, and in some middle-income countries, informal sector employment reaches about 60%. Therefore, there is a need to support countries that will provide cash transfers for informal labor,” El-Said said.
She added that the current crisis has highlighted the urgent need to design labour market programmes, including plans to guarantee employment in public projects to absorb those who lost their jobs, especially informal workers.
“We also need to reduce the cost of integration of the informal sector into the formal sector by reducing taxes or applying a flat tax, facilitating registration procedures,” she said, adding, “This, in turn, would provide an incentive for the informal sector to get regulated, such as facilitating access to finance and training, especially for small- and medium-sized enterprises (SMEs).”
The Minister of Planning and Economic Development concluded her speech by stressing that there is no single solution that might fit all the current challenges. However, there is a need to reach comprehensive policy options that suit different countries according to their circumstances.
“The pandemic has highlighted our lack of immunity for natural threats, but it has also created an opportunity to re-plan our economies and preserve environmental gains while they recover,” she concluded.