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Egypt finance chief set for $4.8B IMF loan

Jan. 7, 2013 at 3:00 AM   |   Comments

CAIRO, Jan. 7 (UPI) -- Egypt's new finance minister said he was ready to wrap up International Monetary Fund talks Monday on a $4.8 billion loan deal to maintain the nation's economy.

Morsi el-Sayed el-Hegazy, sworn in Sunday in a Cabinet shake-up, told reporters he was "completely ready to complete discussions" with the IMF.

The Islamic finance expert, who teaches public finance at Alexandria University and has no previous government experience, was expected to be joined by President Mohamed Morsi, Prime Minister Hesham Kandil and other top Egyptian officials in the meeting with IMF Middle East and Central Asia Director Masood Ahmed, officials said.

The meeting was postponed from last month at Cairo's request because of political turmoil over the country's divisive new Constitution.

The IMF said Saturday the meeting would focus on Egypt's dire financial predicament -- the Egyptian currency has tumbled to new lows against the dollar -- and "possible IMF support" in light of Egypt's "challenges."

Kandil said Monday's meeting sought to reassure the IMF about the Egyptian economy's ability to recover. The IMF agreed to the loan deal in November, before December's political turmoil.

Cairo says the loan is critical to shoring up foreign-investor confidence in the country, whose foreign currency reserves have fallen by more than half, to about $15 billion.

Egypt's central bank calls that figure a "critical minimum" level.

Morsi has promised tax increases and food and energy subsidy cuts to prove he is willing to enact unpopular austerity measures.

Many Egyptians had expected better economic times after a popular uprising ousted President Hosni Mubarak Feb. 11, 2011, the Los Angeles Times said. More than 40 percent of the population lives on $2 a day.

Hegazy, one of 10 ministers sworn in as part of the Cabinet makeover, replaces Mumtaz al-Said, a vocal advocate of the $4.8 billion loan deal. Said was appointed by the country's transitional military rulers after Mubarak's ouster.

Other replacements include Gen. Mohammed Ibrahim as interior minister, replacing Gen. Ahmed Gamal, who was also appointed by the military rulers. Ibrahim most recently served as head of the prison authority.

The Interior Ministry is responsible for law enforcement.

Eight other new ministers, three of them members of the Muslim Brotherhood, were also named by Morsi in his effort to gain confidence from a disillusioned public.

Morsi once led the Brotherhood.

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