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IMF says fund still willing to offer $3.2 billion loan to Egypt but needs deal on economy plan
DUBAI, United Arab Emirates (AP) ' A senior International Monetary Fund official said Wednesday the fund remains willing to consider a much-needed $3.2 billion aid package for Egypt but is waiting for sufficient consensus from political leaders in Cairo.
The IMF wants Egypt's interim military-backed government and elected officials to put together a comprehensive economic recovery plan before it agrees to provide aid.
Masood Ahmed, the director of the IMF's Middle East and Central Asia department, said Egypt has made some progress on meeting the fund's conditions. But he suggested more work is needed.
Ahmed said the plan, which would include IMF funds and other foreign aid to meet budget shortfalls, should address economic imbalances within the country while protecting the poor and generating confidence among foreign investors.
"As soon as the conditions are in place, where there is a program that technically addresses all the issues, has the necessary backing, and we can mobilize financing, we will be ready .. to present it to our executive directors," Ahmed said at a forum in Dubai.
Egypt's Islamist-dominated parliament last week rejected the military-appointed Cabinet's economic plan, setting back efforts to secure the IMF funding.
Ahmed stressed again Wednesday that any Egyptian economic plan needs broad political support. That is because it is meant to last well beyond upcoming presidential elections, which begin later this month. The military has promised to hand over power to a civilian administration by July 1.
"Not only this government, but the one that will take over after the presidential elections, will need to be supportive and committed to implementing these measures," he said.
The IMF loan will not be enough to cover all Egypt's financing needs. Additional aid packages from the European Union, the oil-rich Arab Gulf states and other sources depend on Cairo's ability to secure the IMF loan.
Ahmed estimated the country needs a total of $10 billion to $12 billion in outside funding over the next 12 to 15 months.
He made the comments at an event to launch the IMF's economic outlook for the Middle East and North Africa.
The IMF expects the region's diverse group of oil-exporting nations to generate economic growth of 4.8 percent this year, up from 4 percent in 2011, thanks in large part to high oil prices.
Regional oil importers, such as Egypt, face sluggish growth of just 2.7 percent in 2012, up slightly from the 2.2 percent they registered last year.
The IMF report includes oil exporters Algeria, Bahrain, Iran, Iraq, Kuwait, Libya, Oman, Qatar, Saudi Arabia, Sudan, the United Arab Emirates and Yemen.
It also includes oil importers Afghanistan, Djibouti, Egypt, Jordan, Lebanon, Mauritania, Morocco, Pakistan, Syria and Tunisia. Libya was left out of the economic growth forecasts because of the ongoing turmoil there.