April 29 (Bloomberg) -- Egypt is making “huge progress” in its talks with the International Monetary Fund for a $4.8 billion loan and an accord may be signed within a “few weeks,” Finance Minister El-Morsi El-Sayed Hegazi said.
Discussions over the long-delayed loan, seen by Egypt as critical for unlocking billions of dollars more in foreign funding, were continuing and the IMF team would return to the country after videoconferencing talks were finished, Hegazi told reporters.
Egypt’s efforts to conclude the final agreement hit repeated obstacles, as the country’s post-2011 uprising transition degenerated into divisive politics and chronic unrest that has battered the economy of the Arab world’s most populous nation. Hany Kadry, a top Finance Ministry official involved in the talks, submitted his resignation in the latest twist.
Hegazi said in an interview today that Kadry’s resignation, which had yet to be accepted, would not affect the loan talks.
Egypt has been trying to rein in spending, taking politically sensitive measures such as scaling back a subsidy system that consumes over 25 percent of government spending. Hegazi said the talks with the IMF were focusing on technical issues and also addressed energy subsidies.
Cuts in the subsidy system present the government of President Mohamed Mursi with a challenge, as they could intensify tensions in the nation ahead of parliamentary elections that Mursi has suggested could begin in October.
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