Post-revolutionary Egypt is at a crossroads, with decisions made during the current political crisis likely to impact the country’s near-term economic and political future. The country’s economy was in a bad way even before President Muhammad Mursi’s 22 November assumption of extra-judicial protection, which triggered the current wave of political turmoil and street protests.
The budget deficit in the first four months (July-October) of the fiscal year 2012-13 soared by 47.4% to E£69.614bn ($11.39bn) from E£47.218bn ($7.73bn) in the corresponding period of fiscal year 2011-12, the November issue of The Financial Monthly, published by the Egyptian Ministry of Finance said. Cairo is badly depending on a $4.8bn loan from the IMF to breathe some confidence back into the economy. This has been provisionally approved but a formal green light will need the backing of the IMF’s Board when it meets on 19 December. And IMF spokeswoman Wafa ‘Amr hinted that any change in Cairo’s policies might affect approval. “The staff-level agreement on financial support from the IMF is based on the economic and social policies that the government plans to implement,” Reuters reported her saying on 27 November. (CONTINUED - 669 WORDS)