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Egypt PM not officially told of US debt relief plans Hisham Qandil says he has no details on reported $1bn debt relief programme, predicts robust financial growth for 2012/13
Egypt's Prime Minister said on Tuesday that his government had not been officially consulted about a $1 billion debt relief agreement with the US, the state-run Al-Ahram newspaper reported. Speaking at a press conference after he opened Tuesday trade on Cairo's stock exchange, Hisham Qandil said he had no information regarding the US's latest fiscal promises to Egypt. Several Western media outlets, including the New York Times and Reuters, reported earlier on Tuesday that the Obama administration is close to offering Egypt's new government $1 billion in debt relief. Qandil also said that the government expects Egypt's economy to grow between four and five per cent in the current financial year, significantly higher than many other forecasts. The economy is estimated to have grown just two per cent in the 2011/12 financial year, which ended 30 June. April's World Economic Outlook report, prepared by the International Monetary Fund (IMF), said Egyptian GDP growth was likely to drop to 1.5 per cent in 2012, from 1.8 in 2011. In 2013, however, the IMF estimates Egypt's economy will grow by 3.3 per cent. Qandil also denied that the IMF had asked Egypt to devaluate the pound as a condition to granting the country the $4.8 billion loan. His denial follows rumours the fund has been pressing for such a move. Egypt is estimated to have used some $20 billion of its international foreign reserves to support the pound to avoid a surge in inflation. The local currency has been suffering since Egypt's January 2011 uprising, prompted by a drop in tourism revenues and investments inflows. The Egyptian pound dropped on Monday to its weakest level in more than seven and a half years. It is currently trading at around 6.1 to the US dollar, its lowest since 30 December 2004. Prominent investment bank EFG-Hermes said in a Monday note that it expected the Central Bank of Egypt to gradually allow the pound to devaluate. EFG revised its forecast for the pound to fall to 6.25 to the dollar by the end of 2012. It previously predicted a rate of 6.10. http://english.ahram.org.eg/News/51984.aspx
