By Reem Abdellatif
WASHINGTON: The International Monetary Fund said on Thursday there was no fixed timeline for concluding loan talks with Egypt and insisted that any IMF financing package have the broad support of all political parties in the country.
“The timeline for concluding an agreement is not fixed and will depend on how quickly progress is made by all sides on these all issues,” IMF spokesman Gerry Rice told a news conference.
Mumtaz Al-Saeed, Egypt’s finance minister, denied that the people’s assembly agreed to accepting the $3.2 billion loan from the International Monetary Fund.
“The minister said that the government is willing to work with the parliament in order to come to an agreement,” an official from the Ministry of Finance’s press office told Daily News Egypt on Thursday.
The statement comes in response to a Wednesday report by state-run daily Al Ahram that claimed the finance ministry and the parliament had finally come to an agreement on the IMF loan.
Al-Saeed said Thursday that obtaining the loan would show the world that the Egyptian economy is able to recover and attract future grant donors and lenders to investing money in the Egypt’s market.
He added that the government will not put the views of Egypt’s legislative authority on the back burner when making the final decision regarding the IMF loan package.
An IMF technical mission is currently in Cairo discussing details of an IMF-backed economic program. Egypt has requested a $3.2 billion financing arrangement from the IMF, following political turmoil that has heightened balance of payments pressures.
The deal would need the backing of the Muslim Brotherhood’s Freedom and Justice Party (FJP), which has nearly half of the seats in parliament.
According to the Central Bank of Egypt (CBE), the country’s foreign reserves lost about $660 million as of the end the March, reaching $15.1 billion, just three months worth of imports.
The country has been losing an average of $2 billion from its foreign reserves every month since the 18-day uprising ended in February 2011. It was not until exactly a year later that the erosion of foreign reserves slowed to roughly $600 million a month.
“A technical team has begun talks with the authorities on specific elements of the government’s program and has met with representatives of political parties,” Rice said, adding, “these talks are ongoing”.
The government’s economic reform plan contains a series of austerity measures and new taxes, according to a draft obtained by Reuters.
The People’s Assembly has argued that accepting the loan would further indebt Egypt. The parliament is somewhat rejecting the funds, while the Cabinet continues to stress that the cash injection offered by the loan is the country’s only way out of the economic crunch at this point.–Additional reporting by Reuters.