Egypt sees talks with IMF 'back on track very soon'

Reuters, Sunday 13 Jan 2013

Prime Minister Hisham Qandil says IMF is doing a quick evaluation to proceed with $4.8 billion loan deal to Egypt

Egypt's President Mohamed Mursi (R), Prime Minister Hisham Kandil (C), Finance Minister Mumtaz al-Saeed (L) and Governor of Egypt's Central Bank (CBE) Farouk El-Okdah (2nd L) meet with IMF Managing Director Christine Lagarde at the Presidential Palace in Cairo (Photo: Reuters)

Egypt hopes to resume talks with the International Monetary Fund on a crucial $4.8 billion loan soon as it struggles to prop up an ailing economy wrecked by protracted political unrest.

Egypt's loan agreement was approved in principle in November, but subsequent turmoil forced the government to delay a series of bitter austerity measures deemed necessary to win the IMF board's final approval.

Addressing a business forum in Cairo, Prime Minister Hisham Qandil said government had agreed a "home-grown fiscal and financial programme" as part of the deal.

"Because of the domestic situation we had to postpone that, so we are doing a quick evaluation. We are going to be back on track very soon," he said.

"We invited another mission of the IMF to again realign the programme so we can move forward with our national reform programme to handle the budget deficit, to handle the fiscal problems so we can move forward with growth."

Political unrest and sometimes violent protests in late November and early December set off a rush to convert Egyptian pounds to dollars, sending the currency to record lows on fears of a messy devaluation.

Officials said earlier an IMF team was expected to visit Cairo in two to three weeks. Egypt's newly named central bank chief said last week there was no need to be worried about the situation.

"We are committed to reform. We are committed to deal with the budget deficit," Qandil said.

He added Egypt planned to hold an international economic forum in coming months to highlight investment plans and would also hold business roadshows to attract investors.

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