Egypt Independent

Update: Finance minister assures IMF won’t interfere with policy, addresses Qatar loan

The International Monetary Fund would not interfere with the Egyptian government’s new reform policies, said Finance Minister Momtaz al-Saeed

on Thursday.

The loan is a sign that the nation’s economy is moving in the right direction, and it should encourage foreign investment, he added.

Prime Minister Hesham Qandil announced on Wednesday that Egypt is negotiating a US$4.8 billion loan from the IMF. The announcement came during a press conference held after a meeting with IMF Managing Director Christine Lagarde and President Mohamed Morsy.

Egypt hopes to reach a deal on the loan with the IMF by the end of the year, Qandil said.

 “Egypt is one of the founding countries of the Fund and contributes to its capital,” Saeed said. “It is therefore entitled to assistance when going through a crisis.”

Saeed explained that the loan is primarily contingent on an economic and social reform program that the Egyptian government has prepared in order to get out of the current economic crisis.

Lagarde is reported as saying that the loan would be granted in three installments, and the impact of each installment on Egypt’s economy would be reviewed on a case-by-case basis. Saeed responded by saying that the Egyptian government has the final say on what that impact is, and what measures should be taken to respond to it.

The minister pointed out that negotiations with the IMF do not mean the latter will be able to interfere in the internal affairs of Egypt, as the government is planning to implement a reform program regardless.

Regarding IMF conditions on the loan, Saeed said any country requesting loans must have a reform program.

Also on Thursday Saeed announced that the first installment of the $2 billion loan from Qatar has been deposited in the Central Bank of Egypt. Saeed said he asked the CBE to convert the $500 million payment into Egyptian pounds to bolster the state treasury and make payments.
The balance of the Qatari loan may arrive next month, said Saeed. This loan follows $500 million worth of aid made by Qatar to Egypt last October.
Edited translation from MENA