The International Monetary Fund (IMF) has agreed to approve a three-year $12bn (€11bn) loan for Egypt to help the country out of its deep economic crisis.
Egypt will receive $2.75bn promptly, with the remainder issue to its economic operation and further reforms. Egypt’s President Abdul Fattah al-Sisi is facing a budget deficit of 12% of GDP and high unemployment. The state has struggled to attract foreign investment since the political turmoil in 2011 and the so-called Arab Spring, which saw former president Hosni Mubarak. Tourism – a leading source of income for Egypt – has dropped sharply in the last five years. Egypt floated its currency in a move that reduced its value by almost 50% against the dollar within an attempt to reinforce confidence in the market last week. The government also increased rates of interest by three percentage points to 14.75%, and raised the cost of basic commodities and fuel. The moves led to widespread criticism of the president and a fall in his popularity. A big security operation was set in place in Cairo to pre-empt mass protests that had been expected on Friday.
