Egypt could conclude IMF loan deal by end of May: Fund official

IMF executive director for Arab region says agreement on terms of proposed $4.8 billion IMF loan deal would likely be finalised by end of next month, state media reports

Egypt may reach a deal on a long-awaited $4.8 billion loan from the International Monetary Fund (IMF) by the end of May, state news agency MENA reported on Wednesday citing an IMF official.
Abdel-Shakour Shaalan, IMF executive director for the Arab region, said that Egypt would obtain the loan in multiple phases starting with a first tranche of roughly $2 billion.
Shaalan added that Egypt would pay the loan back after three years at interest rates ranging between 1.1 and 1.5 percent.
Egypt will have a better chance of receiving additional financial aid from other sources after signing the IMF loan deal, Shaalan explained, as several global lenders will depend on the IMF's assessment of Egypt's economic position.
As for Egypt's economic reform programme that is meant to meet the IMF's list of preconditions, Shalaan said that the fund's permanent representative would be tasked with revising the programme quarterly before granting Egypt each additional tranche.
The Egyptian government and the IMF have agreed to unify sales taxes to approach 10 percent, Shalaan said.
In March, Egypt announced plans to raise sales taxes on six goods in hopes of increasing state revenue by around LE13 billion (roughly $2 billion) and curbing a widening budget deficit. The Shura Council – the upper house of Egypt's parliament, currently endowed with legislative powers – has yet to ratify the new tax scheme.
According to an earlier IMF-Egypt joint statement, talks on the proposed loan deal will be concluded "within weeks."
The statement came after IMF chief Christine Lagarde met an Egyptian delegation in Washington this weekend, which included Central Bank of Egypt Governor Hisham Ramez and Finance Minister El-Mursi Hegazy.
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