Egypt Economic Governance Activity (EGA) FY2020 Q4 Quarterly Report

This cross-sector engagement will support Egypt's economic and good governance reforms by supporting the reform process, building the capacity in public administration, including rolling out anticorruption and governance training across the government at all levels of the civil service, and improving local service delivery, with an emphasis on innovative e-governance. During the six-week reporting period, the team remained focused on technical and operational start-up. Consultation meetings were held with key counterparts, including the National Institute for Governance and Sustainable Development, the Central Agency for Organization and Administration (CAOA), the National Anti-Corruption Academy (NACA), the Ministry of Communications and Information Technology (MCIT), and the Information Technology Industry Development Agency (ITIDA). These meetings and consultations were critical to informing Year 1 workplan activities and building relationships with key stakeholders. Various meetings were also held with USAID to ensure lessons learned and best practices are applied to EGA. The project team identified office space in New Cairo City and made progress in executing subcontracts with EGA's institutional partners. Key project deliverables were submitted to USAID during this reporting period, including the Revised Mobilization Plan and Security Plan. Four out of five key personnel were hired, and progress was made in recruiting and interviewing other critical technical and operations candidates. The Government of Egypt has achieved an encouraging degree of macroeconomic and fiscal stabilization in the past several years, coupled with regulatory, policy, and civil service reforms to create space for private sector growth. This has included macroeconomic and fiscal stabilization through liberalization of the exchange rate, fiscal consolidation, and energy sector reforms. Key legislative reforms to improve the business environment have also been undertaken, such as the issuance of the new investment law (law 72 of 2017) and its executive regulations. The rating agency Moody's reaffirmed Egypt's B2 status in September 2020, which the government has cited as a mark of the resiliency created by its reform investment. The Minister of Finance specifically has called out "the strength of institutional performance and governance" as part of the positive indicators. This momentum and relative success should have a positive effect on encouraging continued public administration and good governance reforms. However, the Coronavirus pandemic poses a threat to Egypt's recovery, due to reduced global demand and the disruptive impact on domestic economic activity. Job growth remains stagnant, and COVID response may also have tertiary impacts on the general political environment.