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Egypt protests won't affect IMF deal, minister says

Foreign minister says ongoing political unrest will not jeopardize Egypt's $4.8 bn loan deal with International Monetary Fund

Reuters, Thursday 29 Nov 2012
Kamel Amr
German Foreign Minister Guido Westerwelle, right, and his counterpart from Egypt, Kamel Amr, left, address the media during a joint press conference at the Foreign Office in Berlin, Germany (Photo: AP)
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Unrest in Egypt will not jeopardize a $4.8 billion loan deal with the International Monetary Fund, its foreign minister said on Thursday after a week of protests triggered by President Mohamed Mursi's decision to extend his powers.

Egypt reached a preliminary agreement with the IMF last week for the loan seen as vital to shoring up the nation's finances. The IMF board is due to finalise the deal on 19 December.

"What is happening now will not have an effect on the talks or the agreement with the IMF," Foreign Minister Mohamed Kamel Amr told a joint news conference in Berlin with his German counterpart Guido Westerwelle.

"There is an Egyptian consensus that this agreement must be pushed through."

A spokeswoman for the IMF said on Tuesday its board would require that there be no major change in Egypt's economic outlook or economic policy when it considers approving the loan.

Egypt has said it plans to rein in its budget deficit from about 11 per cent of gross domestic product in 2011/12 to 8.5 per cent in the financial year that ends in June 2014 by better targeting subsidies and expanding the country's tax base.

Two people have been killed and hundreds injured in countrywide protests ignited by the decree Mursi issued last Thursday, which gave him sweeping powers and placed them beyond legal challenge.

Westerwelle said Amr had indicated the Egyptian government's willingness to find a solution.

"The independence of the justice system and the rule of law is an essential element for us. We welcome that our Egyptian colleague emphasized to us the spirit of consensus," he said.

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