IMF to hold talks on loans with Egypt

Posted on August 06, 2012

IMF to hold talks on loans with Egypt

The International Monetary Fund (IMF) will send a mission to Egypt this month to hold talks on loans with President Mohamed Mursi.

A spokesman for the Fund said the mission would discuss "possible financial support for a homegrown economic program."

IMF's director for the Middle East and Central Asia, Masood Ahmed is among the delegation.

Expected growth increase
Egyptian Finance Minister, Mumtaz al-Saeed said IMF officials had been invited to resume talks on a $3.2 billion loan.

Mr. Saeed, who was selected to remain in his post in the new cabinet sworn-in last Thursday, said he expected a growth rate of 3.5 to 4 percent in the 2012-2013 fiscal years.

"The IMF stands ready to support Egypt and work closely with the authorities." He said.

Egypt's former interim government had previously forecast 4 to 4.5 percent growths for the 2012-2013 fiscal years, which started on July 1.

Credibility to reforms
An IMF deal would help Egypt stave off a budget and balance of payments crisis and add credibility to economic reforms needed to restore the confidence of investors who fled the country after the overthrow of former president Hosni Mubarak, by a popular revolt last year.

President Mursi's new cabinet will have to decide if it should implement new and potentially painful austerity measures to help stabilise government finances and secure foreign financial help.

REUTERS/Ibisaki/Yinka