Egypt may get $2 bln within 2 months of agreeing on IMF loan

Hopes to finalise deal when Fund team begins a two-week visit to Cairo on July 30

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Egypt expects to receive at least $2 billion within two months of agreeing a three-year $12 billion loan program with the International Monetary Fund, a senior finance ministry official said on Thursday.

Egypt announced late on Tuesday it was seeking $4 billion a year over three years from the International Monetary Fund to help plug a funding gap and restore market stability. The government hopes to finalise the deal when an IMF team begins a two-week visit to Cairo on July 30.

In a news conference on Thursday, deputy finance minister for monetary policy Ahmed Kojak, said that each tranche of the IMF loan would have to repaid within five years including a three-and-a-quarter year grace period. Egypt has already said it expected to secure the IMF lending program at interest rates as low as 1 or 1.5 per cent.

International bonds

The country is also planning to issue $2 billion to $3 billion in international bonds in September or October. Kojak said Egypt would next week begin seeking international institutions to arrange that eurobond issue. He said the proposed IMF deal was only part of Egypt's program to turn around its economy.

Egypt is also expecting the African Development Bank to approve in September the release of the second tranche of a $1.5 billion three-year loan program, Kojak said.

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