Finance Ministry Seeks US$10.4 Billion Loan from IMF

An informed governmental source said Finance Minister Hani Qadri Demian will try to convince the Cabinet to resume negotiations with the International Monetary Fund starting next year in order to reduce the budget deficit, especially that governmental measures over changing prices of natural gas, electricity and fuel are not enough for the fill the gap.

Negotiations between Egypt and IMF over a US$4.8 billion to support the economy stopped in 2013. The loan would also yield confidence in the Egyptian economy and hence encourage investors.

Rationalizing subsidies and carrying out economic reform measures were among the conditions to get the loan.

The Cabinet had earlier adopted an increase in prices of fuel and electricity as well as the gradual removal of subsidies on energy to reduce the budget deficit.

The minister, according to the source, started serious attempts to convince the government to file new requests to IMF to resume talks to get US$10.4 billion by 2015 with a 1-2 percent interest rate, especially that the fund praised the steps taken by the government regarding energy and commodities as well as the new tax measures that would increase the state resources.

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