IMF, Egypt hope to reach loan agreement in ‘weeks’

The International Monetary Fund and Egypt hope to conclude talks for a loan deal “in the coming weeks,” they said in a joint statement Sunday.

The statement came after IMF Managing Director Christine Lagarde met an Egyptian delegation in Washington this weekend led by Central Bank of Egypt Governor Hisham Ramez, Finance Minister Al-Morsy Hegazy and Minister of Planning and International Cooperation Ashraf Al-Araby.

The Egyptian officials “are firmly committed to addressing Egypt's economic and financial challenges with the objective of restoring sustained and socially-balanced growth, and they are already taking encouraging actions in this direction,” the brief statement read.

The statement said that “further progress had been made” and that “work will continue with the objective of reaching agreement on an IMF Stand-By Arrangement to support the authorities’ national economic program in the coming weeks.”

Central Bank of Egypt's governor, Hisham Ramez, said he expects a deal with the IMF during April or May for a US$4.8 billion loan.

“A deal will be reached within weeks, this month or in May,” he said in statements quoted by state agency MENA. He said that all that remains in the negotiating process are reviews of some of the data.

Ramez added that his talks with IMF chief Christine Lagarde tackled the required steps that will be adopted as part of Egypt’s economic reform program. “Each step has to be studied carefully so as not to affect the people negatively,” he said.

The IMF and Egypt have been in talks for months over a multibillion-dollar IMF loan that is contingent on strong support from domestic political actors and a commitment to key reforms.

Last year the IMF reached a deal in principle to provide a $4.8 billion loan to help finance the government while it undertakes reforms.

The loan was close to completion in November when political crisis in Egypt set it back.

Authorities believe the IMF loan will help restore investor confidence in Egypt, which has seen a blow in the last two years since the uprising that toppled former President Hosni Mubarak.

On Saturday, Lagarde said the IMF would remain engaged in loan negotiations with Egypt but also wanted the international community to provide financing.

“We will not give up, we will not leave the table,” Lagarde said at a news conference during the IMF and World Bank spring meetings in Washington.

Lagarde emphasized that the IMF “cannot be the only one” to help prop up Egypt's economy. “It will take international support and international donors to also help Egypt,” she said.

President Mohamed Morsy faces pressure from an increasingly vocal opposition that accuses him of betraying the goals of the 2011 revolution.

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