SAO PAULO, Feb 27 (Reuters):
The International Monetary Fund has resolved key issues with Egyptian authorities in a review of its $3 billion loan program and should finalize an augmented financing package within weeks, IMF Managing Director Kristalina Georgieva told Reuters on Tuesday.
Georgieva, in an interview on the sidelines of a G20 finance meeting in Brazil, declined to say how big a loan increase Egypt could expect and details were still being finalized. She said the engagement had been “very constructive” and there were “very encouraging signals” about Egypt’s views on dealing with heritage issues that had affected its competitiveness.
Asked about media reports that the IMF could boost the size of Egypt’s $3 billion loan to as much as $12 billion, Georgieva said, “You know, there is nothing wrong in thinking big.”
“The likelihood of us augmenting the program, of course, is right there,” she told Reuters in an interview on the sidelines of a meeting of Group of 20 finance officials in Sao Paulo, citing additional challenges posed to Egypt by Israel’s war in Gaza and shipping disruptions in the Red Sea.
“The stability of Egypt matters to Egypt, but it matters to the whole Middle East,” she said.
Egypt’s announcement on Friday of a $35 billion investment by the United Arab Emirates to develop a prime stretch of its Mediterranean coast was a “a very positive sign,” she said.
The IMF would also factor in inflows of funding from other sources to close Egypt’s financing gap, she said.
Georgieva said she had expected the program reviews to be completed by now, but the IMF wanted to give the Egyptian authorities the space to “have the confidence that all the elements of support are there.”
