Egypt-IMF: more trouble
Egypt and the IMF have repeatedly failed to reach agreement over a $4.8bn loan over the last 18 months. But the consensus among analysts, echoed by Egypt and the IMF, has been that, sooner or later, a deal will be done.
But recent developments have cast a very different light on the on-off negotiations. It’s time to ask: could Egypt get by without the IMF? Continue reading »
IMF agenda: Tunisia done, Egypt TBC
For Tunisia, the deal is done. But as far as the bigger, trickier north African question goes, there are merely encouraging words.
On Saturday, the IMF concluded terms with the Tunisian government on a crucial loan. Meanwhile for Egypt, while talks continue in Washington on the sidelines of the IMF spring meeting, no news is a worry. Continue reading »
IMF / Egypt: reading the signals
As beyondbrics reported on Monday, Egypt’s talks with the IMF over a possible $4.8bn loan have faltered, again.
So what does this mean for the country? And will deal with the Fund ever materialise? Continue reading »
IMF in Egypt and Tunisia: win some, lose some
A mixed bag for the IMF in north Africa in April, if early reports are anything to go by.
Egypt’s talks with the Fund over a $4.8bn (plus) deal have floundered – again. But there is better news 2,000km to the west, where Tunisia looks to have sealed a $1.78bn loan. Continue reading »
Egypt: Qatar loan puts IMF on hold
On the face of it, for a crunch week, Egypt has had a better time than usual.
The IMF is in town for talks on a $4.8bn (or more) loan; March inflation figures showed an improvement. And to top it all, on Wednesday it was announced that Qatar was stumping up another $3bn for the country.
But dig a little more, and there are worrying signs ahead. Continue reading »
Egypt-IMF: back to the table
Egypt and the IMF have restarted talks over a possible $4.8bn loan on Wednesday, after previous discussions were held up due to political violence.
The country desperately needs the loan to avert a crisis and unlock other sources of funding, and has started to make moves in the right fiscal direction. So what are the chances of a deal being done? Continue reading »
Egypt/Tunisia: IMF crunch time
April looks set to be a busy time for the IMF. Two crucial meetings have been put in the diary – one with Tunisia, and one with Egypt (again).
The two potential deals have a lot at stake, and not just in monetary terms. Tunisia’s possible $1.7bn loan will help shield the country from the European downturn. Egypt’s on-off $4.8bn loan is even more important, as it should unlock other sources of funding, and avert what could become a complete collapse of the economy. Continue reading »
Egypt: inflation figures add to gloom
Now Egypt’s on-off IMF deal has reverted to “off”, the country is back in crisis territory, as far as analysts are concerned. Foreign reserves are still perilously low; elections are being kicked down the road; reforms to tax and subsidies are slow or delayed.
Add to all that the latest inflation data, and the picture is not pretty. Egypt’s statistical agency said on Sunday that urban inflation was up 8.2 per cent in February year-on-year, up from January’s 6.3 per cent. Continue reading »
Egypt: time for a sukuk
Egypt’s continued political turmoil has made its life hard in international debt markets, but its government is hoping to secure new funds by less conventional means through the issue of the country’s first sovereign Islamic bonds.
According to a Bloomberg report, the government plans to raise up to $1bn by June through sukuk sales, with one for domestic investors and one for foreign investors. Continue reading »
Egypt reserve decline: trouble ahead
A fall in Egyptian foreign exchange reserves in January might have been expected, but not this big. The drop of $1.4bn to a 15-year low of $13.6bn, announced by the central bank late on Tuesday, pushes the country closer to economic collapse.
The December foreign exchange reserve levels of $15bn were considered sufficient to cover only three months of imports – which the central bank in December called “minimum and critical levels” – and if it wasn’t already, the necessity of securing additional foreign assistance is now urgent. Continue reading »
Egypt unrest: enter the vicious cycle
Two years on, and Egypt is back in crisis. Mohamed Morsi, Egypt’s Islamist president, announced a month-long state of emergency on Sunday following violence in which nearly 50 have died.
For anyone hoping for a turnaround in Egypt’s economic fortunes, it’s another big blow and one that may hurt chances of a deal with the IMF. Continue reading »
Egypt: IMF pledges support as Qatar doubles up
A senior IMF official visiting Egypt this week to discuss the country’s stalled $4.8bn loan agreement has said the organisation remains committed to helping Egypt through its financial difficulties.
Masood Ahmed, head of the IMF’s Middle East and Central Asia Department said the Egyptian government had expressed “firm commitment” to implementing a “macroeconomic program that enjoys broad support”. Continue reading »
IMF visits Egypt to discuss loan as economic crisis worsens
A senior IMF official was meeting with the Egyptian government on Monday to discuss a stalled $4.8bn loan deal, as renewed political turmoil pushed the country closer to economic crisis.
Top of the mission’s mind will be whether the government still has the capacity to implement economic reform as the central bank struggles to run a managed devaluation of the Egyptian pound that risks slipping out of control. Continue reading »
Egypt’s currency slides as central bank attempts managed devaluation
The Egyptian pound has been suffering a dramatic devaluation in recent weeks, falling to record lows as political turmoil casts doubt over the country’s economic prospects.
The slide continued on Thursday, albeit at a slower pace, with the currency reaching a record low of £6.42 to the dollar in the spot market as of 15.30 GMT, as the central bank completed its fourth successive dollar auction in a week. This adds to declines of over 3 per cent since Monday when the auctions began – the biggest falls since 2003. Continue reading »
Egypt: cancelled debt issue and downgrade cements poor December
Increasing stress in the Egyptian economy was underlined on Thursday as the central bank cancelled a major sale of treasury bills.
The offer was supposed to raise 6bn Egyptian pounds ($969m) through 2bn pounds worth of six month bills and 4bn pounds worth of one year bills, and its cancellation sent the Egyptian pound tumbling to its lowest value since 2004. Add in the a recent ratings downgrade, and it’s a tough December for Egypt. Continue reading »
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