São Paulo – Talks between Egypt and the International Monetary Fund (IMF) for a US$ 4.8 billion loan to the country will continue in weeks to come, said the IMF director for the Middle East and Central Asia, Masood Ahmed, who travelled to Cairo last Sunday (17th).
“I welcome the authorities’ determination to move forward with their economic reform program that seeks to address these challenges in a socially balanced manner,” said Ahmed according to an IMF press release.
The two parties reached an agreement last November, but the Egyptian government halted its implementation amidst popular protests in December. There is fear that the austerity measures advised on by the Fund, especially higher taxes, will cause further instability in the country.
Ahmed’s visit marked the resumption of negotiations. He said the Fund remains “committed to support Egypt in this endeavour.” “We agreed that our discussions would continue diligently over the coming weeks with the aim of reaching agreement on possible financial support from the IMF,” he stated according to the release.
Aside from Egypt’s resistance in taking unpopular measures, another hurdle stands in the way of an agreement: the parliamentary elections scheduled for next month have been suspended by the Administrative Court. Meanwhile, the country needs cash to fund its national accounts. An IMF technical team will be in charge of discussions with Egypt in the next round of negotiations.
In Cairo, Ahmed met with prime-minister Hisham Kandil, Central Bank governor Hisham Ramez, Finance minister Al Mursi Hegazy, and the minister of Planning and International Cooperation, Ashraf Al-Araby.
*Translated by Gabriel Pomerancblum
