Egypt has secured the USD 6 billion in bilateral financing required to secure a USD 12 billion loan from the International Monetary Fund (IMF), Reuters reported Minister of Finance Amr El Garhy said on Tuesday.
Egyptian authorities reached a preliminary agreement with the IMF in August to receive a three-year extended fund facility worth USD 12 billion, which will be used to support the government’s ambitious reform program aiming to reduce the country’s budget deficit.
The USD 6 billion in bilateral financing, along with the floating of the currency and a cut in subsidies, was one of the requirements the IMF stipulated before giving the loan its final stamp of approval.
According to El Garhy, the bilateral financing was secured through a number of channels, including loans from the World Bank, Saudi Arabia and the United Arab Emirates, in addition to a USD 2.7 billion currency swap with China.
The fund announced that its board will be meeting this Friday to discuss giving the final approval for the loan and an official from Egypt’s finance ministry told Reuters that, if the loan goes through, Egypt could receive the first tranche of the loan – worth USD 2.75 billion – as early as next Tuesday.
Egypt has been struggling to regain its rapidly depleting foreign currency reserves since the ouster of Hosni Mubarak in 2011. In the five years since, Egypt’s foreign reserves have gone down more than 50 percent, from USD 36 billion to USD 19.041 billion as of October 2016.