Despite the currency shortage and tourism that failed to recover in 2016, the government is on the right track with much-needed reform to push growth towards its potential, CPI Financial writes in what reads like a summary of a research note. Egypt’s fiscal and monetary policy are expected to tighten in 2017, and while “this will no doubt put pressure on growth, though we expect this pressure will be more than offset by an increase in foreign investment, exports and tourism,” NBK said. The float should boost competitiveness of the exports and tourism sectors, while a cheaper EGP will encourage the return of foreign investors. Authorities will be tempted to limit the tightening of fiscal and monetary policy to minimize potential severe short-term economic and social impact. However, the massive fiscal and investment support currently pledged to Egypt by the IMF and others is largely conditional on the progress of reforms.