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IMF says it held productive talks on new programme for Egypt

Symbol, Clock Tower, Building REUTERS/Yuri Gripas
International Monetary Fund logo is seen outside the headquarters building during the IMF/World Bank spring meeting in Washington, US, April 20, 2018

The International Monetary Fund (IMF) said on Friday it had held productive discussions during a staff visit to Egypt on economic policies and reforms to be supported by an extended fund facility.

“In the period ahead, we are continuing our close engagement with the authorities towards reaching staff-level agreement,” the IMF statement said.

The IMF announced that Egypt had made a request for a new programme in March as it came under new financial pressure from the war in Ukraine.

Egypt has turned to the IMF three times in recent years, borrowing $12 billion under an Extended Fund Facility in November 2016, $2.8 billion under a Rapid Financing Instrument in May 2020, and $5.2 billion under a Stand-by Arrangement in June 2020.

Analysts say that because Egypt has exceeded its normal IMF borrowing quota, it would likely face exceptional access criteria, making it subject to a greater level of scrutiny.

Egypt’s central bank governor has previously said that the scale of any new funding is not expected to be large, given that Egypt has already taken a big allocation from the fund.