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Egypt in talks with IMF for second tranche of financial support

May 13, 2020 at 7:00 pm

International Monetary Fund (IMF) [Flickr]

Egypt is in talks with the International Monetary Fund for a second bundle of financial support after receiving nearly $2.8 billion in emergency financing, the central bank deputy governor said on Wednesday, Reuters reports.

Asked about a Bloomberg News report that Egypt would seek a further $5 billion from the IMF and $4 billion from other sources for a total of $9 billion, Rami Aboul Naga told Al Arabiya news channel that the number was close to that figure.

Egypt said on Tuesday that it had received $2.77 billion through an IMF Rapid Financing Instrument designed to help close a gap in its balance of payments as the new coronavirus outbreak takes its toll on the economy.

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It is seeking a further tranche of loans under an IMF Stand-By Arrangement.

The pandemic has brought tourism in Egypt to a standstill, triggered major capital flight, and threatened remittances from Egyptian workers based abroad.

Egypt’s foreign reserves dropped to $37 billion at the end of April from more than $45.5 billion two months earlier. According to Aboul Naga, the country currently has enough reserves to cover seven months’ worth of imports.