Cairo — Egyptian Prime Minister Hisham Qandil has confirmed on Tuesday that his country's negotiations with the International Monetary Fund (IMF) for a proposed loan have been delayed for one month, given the country's current unstable political situation.
Qandil told reporters that Egypt has asked formally for a delay of the negotiation with the IMF also because of the problems brought by newly-issued economic austerity measures.
On 20 November, Egypt reached a primary deal with the IMF on the granting of 4.8 billion U.S. dollars to overcome the country's economic problems. But the situation in the North African country soon turned tense after President Mohamed Morsi issued a controversial constitutional declaration on 22 November.
The constitutional declaration, which aimed to expand Morsi's powers by making all his decrees issued since he came into office final and above judicial appeal, triggered waves of protests nationwide and deadly clashes between his opponents and supporters. Demonstrations are still raging after a new constitutional declaration on Sunday cancelled the previous one.
After the massive unrest last year, Egypt is in dire need of the IMF loan to cover the budget deficits after its foreign reserves fell to about half of the level at the end of former President Hosni Mubarak's era.
The government is also facing a crisis in the balance of payments and high borrowing costs. The IMF loan is also expected to help avoid the devaluation of the Egyptian currency.