IMF announces $3 billion loan for Egypt
The International Monetary Fund’s staff has finalized details of planned $3 billion standby loan to help Egypt’s new authorities plug its budgetary hole: The International Monetary Fund agreed Sunday to a $3 billion loan to help Egypt overcome a cash crunch and boost salaries in the wake of the pro-democracy uprising that toppled its longtime ...
The International Monetary Fund's staff has finalized details of planned $3 billion standby loan to help Egypt's new authorities plug its budgetary hole:
The International Monetary Fund’s staff has finalized details of planned $3 billion standby loan to help Egypt’s new authorities plug its budgetary hole:
The International Monetary Fund agreed Sunday to a $3 billion loan to help Egypt overcome a cash crunch and boost salaries in the wake of the pro-democracy uprising that toppled its longtime president.
The world’s most populous Arab nation has been struggling to close a $10 billion budget deficit for the fiscal year beginning in July. Since the ouster of longtime president Hosni Mubarak in February, the critical tourism industry has suffered major losses and foreign investment has tapered off.
The IMF is presenting the loan, which still requires approval by the Fund’s executive board, as one part of a broad international effort to stabilize the economies of the region:
The IMF is working closely with the World Bank and other multilateral development banks on an integrated approach to stabilizing and modernizing the economies of the region. This collaboration—known as the “Deauville Partnership for the Middle East”—was launched at the Group of Eight summit in late May.
The World Bank has pledged $4.5 billion in support to Egypt over the next two years to address budget and reserve shortfalls and to finance reforms that strengthen its credit and investment prospects. In recent weeks, Saudi Arabia, Qatar, the United States and others have also promised large amounts of assistance to the country.
Announcement of the loan coincided with an Egyptian court’s decision to sentence former finance minister Yousef Boutros-Ghali to thirty years in prison. Just over a year ago, Boutros-Ghali was gently lecturing the IMF about how to prevent finanical crises.
David Bosco is a professor at Indiana University’s Hamilton Lugar School of Global and International Studies. He is the author of The Poseidon Project: The Struggle to Govern the World’s Oceans. Twitter: @multilateralist
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