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IMF working with Egypt on backing for loans

WASHINGTON (Reuters) – The International Monetary Fund said on Tuesday it was staying in close touch

with Egyptian authorities as they work out a budget and round up political support that would make an IMF financing package

possible.

A photographer takes pictures through

a glass carrying the International Monetary Fund (IMF) logo during a news conference in Bucharest March 25, 2009.

REUTERS/Bogdan Cristel

“A financial arrangement to support Egypt’s

economic program will be presented to the IMF Executive Board once this work is completed and external financing from

bilateral donors and other international institutions is confirmed,” the IMF said in a statement.

An IMF mission was

in Cairo from March 25 until Tuesday discussing details of an IMF-backed economic program. Egypt has sought a $3.2 billion

financing arrangement from the IMF, following political turmoil that has heightened balance of payments

pressures.

Earlier this month, the IMF said there would have to be broad political support from all political parties

in the country before loan talks could be concluded, and it reiterated that point on Tuesday.

The IMF statement did

indicate progress was being made.

“There was a shared understanding on the need to address short-term challenges

facing the economy and to promote reforms that can help achieve higher and more inclusive growth going forward,” the IMF

said.

Any deal would need the backing of the Muslim Brotherhood’s Freedom and Justice Party (FJP), which has nearly

half the seats in parliament.

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IMF working with Egypt on backing for loans