CAIRO Nov 27 The International Monetary Fund's
board will require there is no major change in economic outlook
or policy when it considers approving a $4.8 billion loan to
Egypt, an IMF spokeswoman said.
The loan deal was agreed in principle this month with an IMF
team in Cairo and the board is expected to meet to finalise the
facility on Dec. 19.
Spokeswoman Wafa Amr's remarks were made in an emailed
response to questions about whether President Mohamed Mursi's
decree to extend his powers would threaten the preliminary loan
deal, seen as vital to rebuilding confidence in Egypt's economy.
His decree has set off a wave of protests and violence.
"Consideration of the agreement by the IMF Executive Board
will require that there is no major change in the economic
outlook and implementation plans," Amr said.
Egyptian officials have not indicated any shift in economic
plans that include reining in the budget deficit from about 11
percent of gross domestic product in 2011/12 to 8.5 percent in
the financial year that ends in June 2014.
When the preliminary agreement was reached, a member of the
IMF team involved in the negotiations said he expected it would
be approved by the board.
"The staff-level agreement on financial support from the IMF
is based on the economic and social policies that the government
plans to implement under its programme," Amr said in reference
to the initial loan deal that was announced on Nov. 20.
Amr said implementing those plans included passing a revised
budget for 2012/13 that reflected planned tax and spending
She said it also required "assurances from Egypt's bilateral
and multilateral partners regarding their expected provision of
The IMF deal is expected to encourage investors and support
from other nations for Egypt, whose economy has been hammered by
political unrest since Hosni Mubarak was overthrown in 2011.
On the budget, Egypt initially forecast a deficit of about 8
percent of GDP for 2012/13, which economists said at the time of
publication was optimistic. Since then, officials have said that
target could not be met because reforms it was based on had not
Egypt said it would issue a supplementary budget once a deal
with the IMF was reached, and Planning and International
Cooperation Minister Ashraf al-Araby said on Saturday the
deficit for 2012/13 was now expected to be 10 percent of GDP.