Egypt could be back to the drawing board on austerity measures linked to a critical US$4.8 billion (Dh17.63bn) loan package from the IMF, as the government yesterday indicated that it would need to re-examine the conditions attached to the release of the funds.
"We invited another mission of the IMF to again realign the programme so we can move forward with our national reform programme, to handle the budget deficit, to handle the fiscal problems so we can move forward with growth," the prime minister Hisham Kandil said.
The IMF is seeking reassurances that Egypt's government can push through a fiscal and financial programme that includes tax increases and spending cuts.
Yesterday, Mr Kandil addressed investors at a conference in Cairo, saying that although a programme had been agreed to, it had to be postponed "because of the domestic situation". The government was undergoing a quick-assessment and expected to be on track very soon, he said.
Securing the IMF loan would send a reassuring message to international markets that Egypt was on the path to a sustainable economy.
Discussions had been expected to begin where they left off last month, when violent protests erupted across Cairo to criticise a package of unpopular austerity measures that come as a requirement of the loan. Officials decided at the time to postpone concluding a deal for one month to allow time to explain the loan conditions to the public.
But the latest statements by the prime minister have sparked fears among the investment community of a sustained economic crisis including the collapse of Egypt's currency amid a rapid depletion in foreign currency reserves if the IMF loan is postponed further.
"The government needs a new plan given the uncertainty and how things have drastically changed over the course of two months," said Wafik Dawood, the head of institutional trading at Mega Investment Securities in Cairo.
"They will have to submit new economic plans in line with the economic reality. Much has changed in terms of the currency and political stability."
Egyptians have rushed to buy US dollars in the last two months, causing the pound to fall to record lows amid fears of a bigger depreciation in the currency.
The pound weakened further to 6.5423 to the dollar yesterday, breaking its previous record of 6.52121 on Wednesday.
Foreign reserves fell to $15bn last month, just enough to cover the cost of three months of imports, considered a "critical minimum" by bankers.
The currency slump has fuelled worries about Egypt's financial health. Last week, it emerged that a $2bn financial lifeline from Qatar appeared to have been used up to support the pound.
"It is worrying," Mr Dawood said. "There are still too many uncertainties regarding the IMF loan. Most people within the industry think Egypt will get the loan, but its just about the time factor."
Egypt's benchmark slipped TK per cent yesterday, amid profit-taking by investors, to close at TK. The EGX 30 Index is up more than 4 per cent since the start of the year. It rallied more than 40 per cent last year, ranking it among the top performing markets globally.
Egyptian authorities have pledged that the loan will be disbursed before April, when the country's parliamentary elections are expected to take place.
"Equity markets are likely to be impacted if statements indicate that an agreement will not be reached before April," Mr Dawood said.
* with Reuters
[ halsayegh@thenational.ae ]
Getting there and where to stay
Fly with Etihad Airways from Abu Dhabi to New York’s JFK. There's 11 flights a week and economy fares start at around Dh5,000.
Stay at The Mark Hotel on the city’s Upper East Side. Overnight stays start from $1395 per night.
Visit NYC Go, the official destination resource for New York City for all the latest events, activites and openings.
Votes
Total votes: 1.8 million
Ashraf Ghani: 923,592 votes
Abdullah Abdullah: 720,841 votes
The six points:
1. Ministers should be in the field, instead of always at conferences
2. Foreign diplomacy must be left to the Ministry of Foreign Affairs and International Co-operation
3. Emiratisation is a top priority that will have a renewed push behind it
4. The UAE's economy must continue to thrive and grow
5. Complaints from the public must be addressed, not avoided
6. Have hope for the future, what is yet to come is bigger and better than before
FIXTURES
All kick-off times UAE (+4 GMT)
Friday
Sevilla v Levante (midnight)
Saturday
Athletic Bilbao v Real Sociedad (7.15pm)
Eibar v Valencia (9.30pm)
Atletico Madrid v Alaves (11.45pm)
Sunday
Girona v Getafe (3pm)
Celta Vigo v Villarreal (7.15pm)
Las Palmas v Espanyol (9.30pm)
Barcelona v Deportivo la Coruna (11.45pm)
Monday
Malaga v Real Betis (midnight)
ROUTE TO TITLE
Round 1: Beat Leolia Jeanjean 6-1, 6-2
Round 2: Beat Naomi Osaka 7-6, 1-6, 7-5
Round 3: Beat Marie Bouzkova 6-4, 6-2
Round 4: Beat Anastasia Potapova 6-0, 6-0
Quarter-final: Beat Marketa Vondrousova 6-0, 6-2
Semi-final: Beat Coco Gauff 6-2, 6-4
Final: Beat Jasmine Paolini 6-2, 6-2
MATCH INFO
Euro 2020 qualifier
Russia v Scotland, Thursday, 10.45pm (UAE)
TV: Match on BeIN Sports
Profile box
Company name: baraka
Started: July 2020
Founders: Feras Jalbout and Kunal Taneja
Based: Dubai and Bahrain
Sector: FinTech
Initial investment: $150,000
Current staff: 12
Stage: Pre-seed capital raising of $1 million
Investors: Class 5 Global, FJ Labs, IMO Ventures, The Community Fund, VentureSouq, Fox Ventures, Dr Abdulla Elyas (private investment)
Kill
Director: Nikhil Nagesh Bhat
Starring: Lakshya, Tanya Maniktala, Ashish Vidyarthi, Harsh Chhaya, Raghav Juyal
Rating: 4.5/5
More from Neighbourhood Watch:
TWISTERS
Director:+Lee+Isaac+Chung
Starring:+Glen+Powell,+Daisy+Edgar-Jones,+Anthony+Ramos
Rating:+2.5/5
SPECS
Engine: 2.4-litre 4-cylinder turbo hybrid
Power: 366hp
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Transmission: Six-speed auto
Price: From Dh360,000
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Graduated from the American University of Sharjah
She is the eldest of three brothers and two sisters
Has helped solve 15 cases of electric shocks
Enjoys travelling, reading and horse riding
COMPANY PROFILE
Company name: Klipit
Started: 2022
Founders: Venkat Reddy, Mohammed Al Bulooki, Bilal Merchant, Asif Ahmed, Ovais Merchant
Based: Dubai, UAE
Industry: Digital receipts, finance, blockchain
Funding: $4 million
Investors: Privately/self-funded
COMPANY PROFILE
Name: Haltia.ai
Started: 2023
Co-founders: Arto Bendiken and Talal Thabet
Based: Dubai, UAE
Industry: AI
Number of employees: 41
Funding: About $1.7 million
Investors: Self, family and friends
Company Profile
Company name: Namara
Started: June 2022
Founder: Mohammed Alnamara
Based: Dubai
Sector: Microfinance
Current number of staff: 16
Investment stage: Series A
Investors: Family offices
Story of 2017-18 so far and schedule to come
Roll of Honour
Who has won what so far in the West Asia rugby season?
Western Clubs Champions League
Winners: Abu Dhabi Harlequins
Runners up: Bahrain
Dubai Rugby Sevens
Winners: Dubai Exiles
Runners up: Jebel Ali Dragons
West Asia Premiership
Winners: Jebel Ali Dragons
Runners up: Abu Dhabi Harlequins
UAE Premiership Cup
Winners: Abu Dhabi Harlequins
Runners up: Dubai Exiles
Fixtures
Friday
West Asia Cup final
5pm, Bahrain (6pm UAE time), Bahrain v Dubai Exiles
West Asia Trophy final
3pm, The Sevens, Dubai Hurricanes v Dubai Sports City Eagles
Friday, April 13
UAE Premiership final
5pm, Al Ain, Dubai Exiles v Abu Dhabi Harlequins
THE DETAILS
Deadpool 2
Dir: David Leitch
Starring: Ryan Reynolds, Josh Brolin, Justin Dennison, Zazie Beetz
Four stars
Sweet Tooth
Creator: Jim Mickle
Starring: Christian Convery, Nonso Anozie, Adeel Akhtar, Stefania LaVie Owen
Rating: 2.5/5
The specs: 2024 Mercedes E200
Engine: 2.0-litre four-cyl turbo + mild hybrid
Power: 204hp at 5,800rpm +23hp hybrid boost
Torque: 320Nm at 1,800rpm +205Nm hybrid boost
Transmission: 9-speed auto
Fuel consumption: 7.3L/100km
On sale: November/December
Price: From Dh205,000 (estimate)
The specs
Engine: 3.8-litre twin-turbo flat-six
Power: 650hp at 6,750rpm
Torque: 800Nm from 2,500-4,000rpm
Transmission: 8-speed dual-clutch auto
Fuel consumption: 11.12L/100km
Price: From Dh796,600
On sale: now