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Egypt finishes revised economic plan needed for IMF loan - PM

Source: Thomson Reuters Foundation - Wed, 13 Feb 2013 22:59 GMT
Author: Reuters
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CAIRO, Feb 14 (Reuters) - Egypt has finished revising an economic reform plan needed for a ${esc.dollar}4.8 billion IMF loan, the prime minister said on Wednesday, but he did not say when the government might return to negotiations with the fund.

Egypt's government signed a preliminary agreement for the urgently needed loan in November, but the formal signing was delayed after political turmoil forced it to postpone a number of austerity measures necessary for a deal.

Prime Minister Hisham Kandil said the government had now finished drawing up a revised reform programme, basing changes on recommendations from a national dialogue that had been held with different interest groups.

"The new revised programme has been finished," he said in a televised interview with MBC Masr, without giving further details.

Kandil said the government was in touch with the IMF - International Monetary Fund - by email, but when he was asked whether it was true there were difficulties in getting loan negotiations restarted, he said: "Definitely ... (But) we won't go back to zero."

Egypt opposition leader Mohamed ElBaradei on Tuesday called for a national consensus to secure the loan and save the country from economic collapse.

Ratings agency Moody's cut Egypt's credit rating on Tuesday, citing doubts about its ability to secure the loan and the economic impact of a new round of political unrest.

Moody's also cited a further weakening in Egypt's external payments position given a large drop in foreign reserves in January as the country battles to stave off a currency crisis.

Egypt's central bank has said foreign reserves fell to ${esc.dollar}13.6 billion in January, below the ${esc.dollar}15 billion level needed to cover three months worth of imports.

"The economy is not in a good state. The economy needs a pause. It needs calm," Kandil said. (Reporting by Alexander Dziadosz and Ali Abdelatti; Editing by Pravin Char)

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