Volume : 2, Issue : 5, May - 2013

Evaluation of the Monetary Policy Performance in Egypt During the Period (2004–2010)

Dr. Ezzat Molouk Kenawy

Abstract :

In Egypt, the early 1990s through the present have witnessed important change in the Egyptian economy in general and the monetary policy in particular. These changes go along with the world economic trends in line of the financial liberalization policies and the economic globalization. That period has witnessed as well the agreement with the international monetary fund (IMF) and the World Bank to perform three reform financial, economic and structural programmes. Some of them were performed successfully. The central bank performed a banking reform programme to restructure and develop the banking system including the central bank itself in line with new legislations according to the act of central bank and the banking system. In addition, there is a new trend in the field of monetary policy development to transfer into anti–inflation approach which is adopted by many of the developed and emergent countries in accordance with the Egyptian central bank independence. In this light, the research problem can be restricted in an essential question: What are the most effective and affective variables of the monetary policy instruments in Egypt during the study period and what are the function indicators on the success extent of the monetary policy in achieving its objectives?. The research is based on the main hypothesis that the effectiveness of the used monetary policy instruments depends on the extent of providing the legal and institutive environment and the selection of flexible and potential instruments in the proper times. The main research objective is to evaluate the monetary policy performance through defining the suitable monetary policy for the Egyptian economy circumstances during the period (2004–2010). This is done through the display of the development stages of the monetary policy in Egypt and its legislative and corporative framework; the indication of its pillars and how to manage the monetary policy in Egypt during the research period. The research aims as well to determine the performance evaluation indicators of the monetary policy in Egypt during the period (2004–2010) and finally conclude findings and draw suitable recommendations.