IMF to give Egypt $3 billion loan
CAIRO — The International Monetary Fund agreed yesterday to provide Egypt with $3 billion in financing to help the Arab world’s most populous nation ease the blow to its economy sustained during the popular uprising that ousted President Hosni Mubarak.
The loan announcement comes days after the government unveiled a draft budget that projects a deficit of nearly 11 percent of the nation’s gross domestic product. Officials want to boost social services spending to meet the demands of a population that complained of gross economic inequity under Mubarak.
The 12-month standby arrangement spans fiscal 2011-2012, which begins in July, and carries a 1.5 percent annual interest rate — a level that Finance Minister Samir Radwan said fell far below the international borrowing costs Egypt would have had to agree to had it turned to the open market for assistance. The loan, which must still be approved by the IMF’s executive board in July, is to be repaid over five years.