Egypt Expects IMF Loan Installment in January as Talks Delayed
Egypt Expects IMF Loan Installment in January as Talks Delayed
(Bloomberg) -- Egypt expects to receive the fifth installment of a $12 billion International Monetary Fund loan in January, a month later than initially scheduled, amid delays in talks over some elements of the government’s economic program, a senior Egyptian official said.
Among the most important of the issues is the timing of the announcement about the fuel pricing mechanism -- a step the IMF has insisted upon, the official said, speaking on condition of anonymity because he wasn’t authorized to disclose the details of the talks. The mechanism links local fuel prices to international ones, and is a key part of the government’s plans to cut costs.
The issue is a politically sensitive one in Egypt, where the economic program launched in 2016 has increasingly pressured a population of nearly 100 million. Around half of the country’s residents live near or below the poverty line, and many are complaining about the rising cost of living.
The IMF declined to comment. Finance Minister Mohamed Maait didn’t reply for a request for comment.
Amid the sticking point over the announcement of the fuel mechanism, the government has sought to strike a balance.
It plans to announce the pricing mechanism for 95 octane gasoline by the end of the month, with implementation expected in March, the official said. That grade of gasoline is one which is no longer subsidized. It also plans to announce the mechanism for the other grades in June, after the lifting of the subsidies, and to implement the move in September, he said.
To contact the reporter on this story: Mirette Magdy in Cairo at mmagdy1@bloomberg.net
To contact the editors responsible for this story: Alaa Shahine at asalha@bloomberg.net, Tarek El-Tablawy
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