Egypt to receive second $1bn portion of World Bank loan

Egypt will receive the second tranche of the World Bank’s loan agreement amounting to $1 billion within the next few days, the bank’s Country Director for Egypt Asaad Alem announced on Sunday.

Alem statements came on the sidelines of a press conference held in Cairo on Sunday, where he stressed that Egypt has been going through various changes and reforms, one of which is the Egyptian pound floatation which he sees to be one of the most important incentives for the inflow of foreign investment.

Last December, the World Bank’s Board of Executive Directors approved the release of the second tranche of a $3 billion loan package to support Egypt’s economic reform programme. In September, Egypt received the first tranche of the loan which amounted to $1 billion.

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For his part, Merza Hasan, an executive director at the World Bank in Washington, pointed out during the conference that negotiations with the Egyptian government on receiving the third portion of the loan would take place in April.

Hasan added that the economic, social and structural reforms waged by the Egyptian government would help the country in overcoming short-run economic problems.

In September 2016, Egypt’s foreign debt reached to $60.152 billion up from $46.148 billion in 2015 during the same month, recording an increase of $14 billion, according to official Egyptian data.

In 2014, Egypt embarked on a plan to introduce a number of fiscal reforms, including fuel subsidy cuts that raised prices by up to 78 percent, as well the imposition of new taxes to ease a growing budget deficit, currently estimated at 12.2 per cent of GDP.