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Finance minister expects to seal IMF deal before parliamentary elections

El-Morsi El-Sayed Hegazy, claims that the government and the IMF will reach a $4.8 billion loan agreement before the Egyptian parliamentary elections in April

Ahram Online, Sunday 3 Mar 2013
Egypt's minister of finance El-Morsi Hegazy (Photo: Ahram Arabic News Website)

Egypt's Finance minister, El-Morsi El-Sayed Hegazy, expects the International Monetary Fund (IMF) and the Egyptian government will ratify the proposed $4.8 billion loan deal before the Egyptian parliamentary elections planned for April.

The Egyptian government respected its commitments [to the IMF] and amended the 'economic and social recovery program' and included measures regarding the promotion of social justice, fighting corruption and tax, announced Hegazy on Sunday.

The IMF had previously requested that the Egyptian government review its economic recovery program in order to gain popular consent.

The cabinet had organised a series of 'societal dialogue' sessions to discuss the planned tax hikes and removal of subsidies that were part of the recovery program, and amended the program accordingly.

The finance minister told state-owned Ahram that the government had sent a formal invitation to the IMF to visit Egypt in order to review the economic program and the loan terms adding that he hopes the IMF would respond before the parliamentary elections.

Hegazy asserted, however, that the implementation of the government's economic recovery program is not a condition set by the IMF for the loan, and that the government will stick to its execution even if the loan agreement is not reached.

"The loan is not a goal in of itself; it is rather a certificate of recognition for the Egyptian economy and will open the door to a lot of investment that the economy desperately needs," explained Hegazy.

Egypt's budget deficit reached LE50 billion (roughly $8 billion) in the first quarter of the 2012/13 fiscal year, which began in July 2012.

The government is expected to use the loan to finance the country's growing budget deficit.

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