Egypt to float 95 gasoline to international prices in March: Bloomberg
“That grade of gasoline is one which is no longer subsidized. It also plans to announce the mechanism for the other grades in June, after lifting the subsidies, to implement the move in September,” the official clarified.
The official referred to the delay of receiving the fifth installment of a 12-billion International Monetary Fund (IMF) for a month, attributing the delay to talks over some elements of the government’s economic program.
According to the source, IMF insisted on the timing of the announcement about the fuel pricing mechanism, as one of the main issues discussed. “The mechanism links local fuel prices to international ones, and is a key part of the government’s plans to cut costs.”
As per schedule, Egypt should have received the fifth tranche in December after IMF’s Executive Board reviewed Egypt’s economic reform program and offered Egypt the fifth settlement of the IMF’s $12 billion extended fund facility arrangement, amounting to $2 billion.
By receiving the fifth installment, the total disbursements under the program will reach about $10 billion.
In October, IMF reached a staff-level agreement with the Egyptian government to offer Egypt the fifth settlement of IMF’s $12 billion extended fund facility arrangement.
CAIRO - 31 October 2018: The International Monetary Fund (IMF) has reached a staff-level agreement with the Egyptian government, to offer Egypt the fifth settlement of IMF's $12 billion extended fund facility arrangement, amounting to $2 billion, an official statement said Wednesday.
Egypt embarked on a bold economic reform program that included the introduction of taxes, such as the value-added tax (VAT), and cutting energy subsidies, with the aim of trimming the budget deficit.
The country floated its currency in November 2016 before it clinched a $12 billion loan from the International Monetary Fund (IMF).
In November 2016, the Executive Board of the IMF approved a $12 billion loan as a financial assistance for Egypt to support the Egyptian economic reform program.
Upon the board's approval in November, Egypt floated its currency, losing around 50 percent of its value as part of the economic reform program which imposed taxes, including the value-added tax (VAT), and cut energy subsidies, all with the aim of trimming the budget deficit.