May 03 2012
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Mena may need $100b in funding next year
Thursday, May 03, 2012
Dubai The International Monetary Fund recognises that Egypt requires support in stabilising its economy, but the multilateral agency is waiting for the Egyptian government to present a concrete economic recovery plan, a senior IMF official said yesterday.
“We need to have a plan from the Egyptian government before the $3.2 billion (Dh11 billion) loan is approved. The plan needs to address the country’s fiscal issues and investor confidence,” said Masoud Ahmad, the IMF’s director for the Middle East and Central Asia.
The Egyptian government is expected to present a plan to the IMF by the middle of the month. But analysts fear that differences among various political parties could further delay the presentation of the plan. “As soon as there is a plan that addresses all these issues, we will be ready to present this to the IMF board for approval,” Ahmad said.
According to IMF estimates, Mena (Middle East and North Africa) countries undergoing transition will require external support. In 2012 and 2013, gross external and fiscal financing needs of Mena oil importers are projected at about $90 billion and $100 billion, respectively. “While external support is one element of fiscal stabilisation, Mena governments must control spending, central banks will need to focus on maintaining external stability which, in some cases, may require more exchange rate flexibility,” Ahmad said.
The IMF yesterday warned that Syria’s economy is expected to contract significantly in 2012 due to 14 months of violence.
By Babu Das Augustine?Deputy Business Editor
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