The head of the International Monetary Fund will soon travel to Egypt to discuss revising the terms of an $8 billion loan to the country. Kristalina Georgieva made the remarks Thursday in Washington during the IMF and World Bank meetings.
Egypt’s loan deal was agreed in March, but the government is struggling to meet its conditions because of what it described as “unprecedented” regional upheaval. The threat of attack in the Red Sea by the Yemen-based Houthi militant group, which has intensified action in recent months in support of Hamas in Gaza, have significantly hurt revenue from the Suez canal, a major global trade route that is vital to Egypt’s economy
The IMF’s loan requires Egypt to cut its costs — while the government has slashed some subsidies, those measures have raised inflation and worsened conditions for the population, which was already in an economic crisis exacerbated by the war in Ukraine. The war affected the cheap fuel and food imports on which Egypt has long depended.
Georgieva said the IMF was open to revisiting the loan’s conditions Thursday, but stressed that Egypt still had to make changes.
“We are not going to do our job for the country and for the people of the country if we pretend that action that needs to be taken can be forgone,” she said.
Egypt has also received an additional $35 billion investment from the UAE aimed at shoring up its economy as conflicts rile the region.
