IMF Team Resumes Egypt’s Loan Talks

An International Monetary Fund team will arrive to Cairo to resume talks on a $3.2bn loan facility, seen by the government and analysts as crucial to warding off a financial crisis after more than a year of political turmoil.

The team is to start its five-day mission with talks on Monday about the proposed loan with Freedom and Justice, the main Islamist party in parliament, which is expected to lead the country’s next government.

The fund has made a deal dependent on “broad political support” for the loan, and on Cairo’s ability to arrange other sources of finance to enable it to meet an estimated funding gap of $11bn over two years.

Abdel Hafez al Sawy, who heads the FJP’s economic committee, told the Financial Times that his party had not agreed a view on the loan but it was not opposed to borrowing from international institutions.

“We don’t know yet what is the repayment schedule and if the loan will be used to plug the deficit or to fund investment projects,” he said. “We can’t make a decision without clear and accurate information. The government has presented us with an 11-page outline of its economic programme with no details.”