News / Economy

Report: Egypt Delays IMF Loan Decision

Egypt's Deputy Prime Minister Ziad Bahaa el-Din with European Union Foreign Policy Chief Catherine Ashton, Cairo, Oct. 3, 2013.Egypt's Deputy Prime Minister Ziad Bahaa el-Din with European Union Foreign Policy Chief Catherine Ashton, Cairo, Oct. 3, 2013.
x
Egypt's Deputy Prime Minister Ziad Bahaa el-Din with European Union Foreign Policy Chief Catherine Ashton, Cairo, Oct. 3, 2013.
Egypt's Deputy Prime Minister Ziad Bahaa el-Din with European Union Foreign Policy Chief Catherine Ashton, Cairo, Oct. 3, 2013.
Reuters
Egypt has postponed any decision on taking a $4.8 billion loan from the IMF as financial aid from Gulf States has given Cairo some breathing space as it starts to conduct economic reforms, Deputy Prime Minister Ziad Bahaa El-Din said on Tuesday.
 
Bahaa El-Din said Egypt has so far received around $8 billion of a $12 billion aid package from Saudi Arabia, Kuwait and the United Arab Emirates promised in July, days after the army toppled Islamist President Mohamed Morsi.
 
The International Monetary Fund and Egypt have sporadically discussed a possible loan worth up to $4.8 billion to help the ailing economy since a 2011 uprising that toppled President Hosni Mubarak drove away tourists and foreign investors, two main sources of foreign currency.
 
Any IMF deal, however, would require economic reform commitments that the government might find politically risky.
 
“We have postponed that [IMF] decision for the time being. We are not under the extreme stress that the previous government found itself in,” Bahaa El-Din told a conference in London.
 
“The assistance that we have from abroad ... This is money that has come at the right time to give us the breathing space to begin to implement those decisions at the pace and in conditions that are much more favorable than when you are pressed to have to sign an agreement today or tomorrow.”
 
Bahaa El-Din said Egypt was expecting to receive $1 billion in aid from Kuwait but did not say when the cash could arrive.
 
Some $3 billion out of total $5 billion aid from the UAE will be channeled through infrastructure and utility projects.
 
He said Egypt is negotiating for more aid from the Gulf which has so far given the country cash transfers and oil shipments. On top of $8 billion, Egypt's central bank has received deposits from the Gulf to improve liquidity.
 
“Now we all understand and appreciate that this is not a sustainable situation, we are not going to rely every year on getting this kind of money,” Bahaa El-Din said.
 
“But it also comes to fill the gap that I have to assume is also non-recurrent.”
 
The minister told Reuters later that he has also signed a $610 million aid package in total from the World Bank to help build a power plant and develop sewage.
 
A central bank official told Reuters on Tuesday that Egypt returned $500 million to Qatar on Dec. 2 after Qatar refused to renew the deposit it had made with the central bank.
 
Qatar was one of the few Arab states to support Egypt during President Mohamed Morsi's year in office but ties have deteriorated since July.
 
About a dozen Egyptians who oppose the interim government backed by army chief General Abdel Fattah al-Sisi protested outside the Egyptian Cultural Office in central London where the briefing was held.
 
After the briefing, they shouted “shame on you” to the participants, carrying banners that said “Sisi is a murderer” or a symbol adopted by Morsi's Muslim Brotherhood supporters after July.
 
Relaxing controls
 
Bahaa El-Din also said the government was in favor of relaxing capital controls imposed after the 2011 uprising. Capital controls help stabilize the currency but deter foreign investment Egypt badly needs.
 
“Capital controls are not something a country likes to implement. It was imposed under very exceptional circumstances,” he said.
 
“It's a function of where we are ... But you have the assurance of this government those capital controls will be relaxed as soon as possible. Some relaxations will be introduced by early next year.”
 
The central bank has limited Egyptians from transferring more than a cumulative $100,000 out of the country since the 2011 uprising unless they can demonstrate a pressing need for the funds. Many wealthier Egyptians have reached their limit and are no longer able to send funds abroad.
 
Depositors at banks can only withdraw a maximum of $10,000 in foreign currency per day under central bank rules, but in practice many banks restrict such withdrawals to much less and demand documents proving why the client needs the funds.

You May Like

Video Obama to Send 3,000 Troops to Liberia in Ebola Fight

At Centers for Disease Control and Prevention, President says US will take leadership role for a global response to deadly Ebola virus that is ravaging West Africa More

Video China Muslims Work to Change Perceptions After Knife Attacks

Muslims in Kunming say that they condemn the violence, it is not a reflection of the true beliefs of their faith More

Humanitarian Aid, Equipment Blocked in Cameroon

Move is seen as a developing supply crisis in West Africa More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
NASA Picks Boeing, SpaceX to Carry Astronauts Into Spacei
X
September 17, 2014 4:20 AM
The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video NASA Picks Boeing, SpaceX to Carry Astronauts Into Space

The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video Future of Ukrainian Former President's Estate Uncertain

More than six months after Ukraine's former President Viktor Yanukovych fled revolution to Russia, authorities have yet to gain control of his palatial estate. Protesters occupy the grounds and opened it to tourists but they are also refusing to turn it over to the state. VOA's Daniel Schearf reports from Mezhigirya, just north of Kyiv.
Video

Video China Muslims Work to Change Perceptions After Knife Attacks

China says its has sentenced three men to death and one woman to life in prison for a deadly knife attack in March that left more than 30 dead and 140 injured. Beijing says Muslim militants from China's restive western region of Xinjiang carried out the attacks. Now, more than six months after the incident, residents in the city are still coping with the aftermath. VOA's Bill Ide has more from Kunming.
Video

Video Enviropreneur Seeks to Save the Environment, Empower the Community

Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video West Trades Accusations Over Ransoms

As world leaders try to forge a common response to the threat posed by Islamic State militants in Iraq and Syria, there is simmering tension over differing policies on paying ransoms. In the past month, the jihadist group has beheaded two Americans and one Briton. Both countries refuse to pay ransom money. As Henry Ridgwell reports for VOA from London, there is uncertainty in the approach of some other European nations.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Washington DC Mural Artists Help Beautify City

Like many cities, Washington has a graffiti problem. Buildings and homes, especially in low-income neighborhoods, are often targets of illegal artwork. But as we hear from VOA’s Julie Taboh, officials in the nation's capital have come up with an innovative program that uses the talents of local artists to beautify the city.
Video

Video US Muslim Leaders Condemn Islamic State

Leaders of America's Muslim community are condemning the violent extremism of the Islamic State group in Iraq and Syria. The U.S. Muslim leaders say militants are exploiting their faith in a failed effort to justify violent extremism. VOA correspondent Meredith Buel reports.
Video

Video Bedouin Woman Runs Successful Business in Palestinian City

A Bedouin woman is breaking social taboos by running a successful vacation resort in the Palestinian town of Jericho. Bedouins are a sub-group of Arabs known for their semi-nomadic lifestyle. Zlatica Hoke says the resort in the West Bank's Jordan Valley is a model of success for women in the region.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid

World Currencies

EUR
USD
0.7722
JPY
USD
107.08
GBP
USD
0.6171
CAD
USD
1.1041
INR
USD
61.075

Rates may not be current.