Egypt Offers Modest Reserves Target, IMF To Consider Loan Size

Egypt aims to boost its foreign currency reserves to $16 billion by the end of June, the planning minister said on Tuesday, offering a lower target than the government had previously announced.

The reserves stood at $13.5 billion at the end of February, barely enough to cover three months of imports for a country of 84 million that buys much of its food and fuel from abroad.

Egypt’s central bank governor Hisham Ramez told reporters in Dubai that the reserves had gone “down a little bit” in March, adding that the March number would be published in the next two days.

Planning minister Ashraf Al-Araby, also in Dubai for a meeting of Arab finance ministers and central bankers, said Egypt would reach the target of $16 billion with help from international donors. In February, the government had given a higher end-June target of $19 billion.

“About $190 million has entered the central bank in the past few days. This will, God willing, allow us reach the amount we want, of about $16 billion by the end of June 2013,” Al-Araby told al-Arabiya television in Dubai.

He said Egypt had received pledges of about $1 billion from the World Bank, $500 million from the African Development Bank, $900 million from the European Union and $450 million from the United States.

Egypt is also seeking a $4.8 billion loan from the International Monetary Fund, which said on Tuesday that it could conceivably change the loan’s size depending on Egypt’s needs. IMF officials are due to arrive in Egypt on Wednesday to discuss the loan.

Egypt’s finance minister, Al-Morsi Al-Sayed Hegazy, told al-Arabiya on Tuesday that he was negotiating a loan worth $465 million with the Arab Monetary Fund, another multilateral body.

Reuters