The International Monetary Fund’s initial loan payout to Egypt will be worth around $2.5 billion, Masood Ahmed, director of the IMF’s Middle East department, said on Friday.
He added that he hoped to secure board final approval for the Egyptian loan programme within next November.
The $12 billion loan programme will contain conditions that include easing Egypt’s budget deficit and making its currency exchange rate system more market-driven, Ahmed added.
The IMF and Egyptian authorities were “making good progress” on talks with China, Saudi Arabia, and some G7 countries to secure about $5 billion to $6 billion in additional bilateral financing needed for the fund’s programme first year.
“What I can say today is that we’re making very good progress on that and I’m hopeful that we will be able to be in position to firm up these financing pledges in the coming weeks. I’m hopeful by the end of this month, early next month, we can be in a position then to go to the IMF board with a program,” Ahmed said at a news conference.
Ahmed confirmed the IMF would not be making a final announcement on the Egyptian programme during the course of the IMF’s annual meetings, which started Friday.
Ahmed also said while Egypt’s economy was strong, it faced many challenges, including stabilising the macro-economy by containing the budget deficit, bringing down debt levels, and “getting rid of the imbalance in the foreign exchange market and moving to a foreign exchange system which is going to be more flexible when the price of foreign exchange is determined by supply and demand.”