World Bank says Egypt to get next $1 billion loan tranche by early Jan
15 Nov 2016 - 20:41
MARRAKESH, Morocco: The World Bank will provide the second $1 billion tranche of its $3 billion budget support to Egypt by early January, the bank’s vice president Hafez Ghanem said on Tuesday.
Egypt has been negotiating billions of dollars in aid from various lenders to help revive an economy battered by political upheaval since the 2011 revolt and to ease a dollar shortage that has crippled import activity and hampered recovery.
“We are planning to go to our board of directors either by late in December or early in January, so we are talking of a matter of weeks,” Ghanem told Reuters in the Moroccan tourist city of Marrakesh where he was attending the U.N. climate change conference (COP22).
The World Bank provided the first $1 billion to Egypt earlier in 2016. After the second $1 billion by January, the third chunk is expected to follow later in 2017.
In another boost for the Cairo government, the International Monetary Fund’s executive board last week approved a three-year, $12 billion loan aimed at supporting Egypt’s economic reforms, and the central bank said it had received a first tranche of $2.75 billion.
But the government is facing growing discontent over austerity measures required by its international lenders.
Last Friday calls for protests failed to take place, but they have gained traction on social media after Egypt raised fuel prices and floated its currency.
The government has tried to win public support for the austerity measures with a billboard campaign and media blitz and also sought to expand social security schemes to shield the poorest from the effects of the rising prices.
“The reforms that the government has been putting in place, and supported by the IMF and ourselves, are necessary,” Ghanem said. “At the same time, our focus is really making sure that growth and development in Egypt are inclusive.”
Ghanem said the World Bank was working with the government to support the most vulnerable Egyptians through many other programs, including social housing.
Saudi Arabia, along with other Gulf oil producers, have pumped billions of dollars, including grants, into Egypt’s flagging economy since the army toppled President Mohamed Mursi of the Muslim Brotherhood in 2013 amid mass protests against his rule.
(Reporting By Aziz El Yaakoubi; Editing by Alister Doyle and Gareth Jones)