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EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

Egypt expects to renew financing agreement with global banks

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NEW YORK: Egyptian Finance Minister Amr El-Garhy said on Monday he expects a financing agreement with a consortium of global banks will be renewed for another year with the aim to boost foreign reserves while the government implements economic reforms.


“I think so. I think the central bank will renew it. It is a joint decision between the central bank and us (the finance ministry),” El-Garhy said in an interview on the sidelines of a New York investor luncheon sponsored by the American Chamber of Commerce in Egypt.


The original $2 billion repurchase agreement, signed in November 2016, had a one-year maturity.


The banks provided funds against international bonds issued by the finance ministry and listed on the Irish stock exchange.


Asked if the amount of money would be increased, El-Garhy said: “It depends on the amount of the haircut, or discount.


I think it will be improved. Last year it was 30 per cent. I think this will improve this year and the discount could be only 25 per cent, and that reflects improvement in the risk profile of Egypt.”


Egypt has tried to implement economic reforms to help revive its economy, which has been battered by political and economic upheaval since a 2011 uprising.


Part of that effort included signing a $12 billion, three-year financial bailout programme with the International Monetary Fund in November 2016.


The government then floated its currency, the pound, cut fuel and energy subsidies and increased taxes. — Reuters


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