Egypt to receive $500M loan disbursement from African Development Bank 'if not today then tomorrow'

Published December 30th, 2015 - 11:58 GMT

Egypt will receive "within hours" $500 million as part of a loan from the African Development Bank (AfDB), Minister of International Cooperation Sahar Nasr told Ahram Online on Wednesday.

The sum, which is part of a $1.5 billion loan agreement reached between Egypt and the AfDB earlier this month, will arrive "if not today then tomorrow," Nasr said.

As for the first $1 billion tranche of a $3 billion loan from the World Bank (WB) agreed upon on 19 December, the withdrawal forms will be submitted in January once it receives final ratification by Egypt, said the minister, who is also a former World Bank lead economist.

The WB loan is currently being reviewed by the State Council following approval from the Egyptian cabinet and President Abdel-Fattah El-Sisi, said Nasr.

The minister refuted media reports that the introduction of a value added tax (VAT) was a condition for Egypt to obtain the World Bank loan.

However, the minister stressed that the government "needs to do it," in reference to the yet to be finalised tax.

"The budget projections of this fiscal year are calculated while taking into account that the VAT will be in force as of 1 January."

The VAT has been approved by the cabinet, the State Council and the Economic Ministerial Committee, which Nasr co-chairs, but is awaiting final ratification, she said.

"The question is whether we ratify it now or wait a few days for the new parliament to ratify it," she said.

Egypt's newly-elected House of Representatives is expected to hold its first session on 10 January.

The country, whose foreign reserves have fallen to $16.4 billion from $36 billion before the uprising which ousted autocrat Hosni Mubarak in January 2011, is in dire need of foreign funds to plug a financing gap, said Nasr.

"We finished the AfDB loan procedures first because it is critical that this money arrives before the end of the year," Nasr said, citing "commitments and late dues for oil and electricity."

© Copyright Al-Ahram Publishing House

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