IMF postpones USD 4.8 bln loan for Egypt

The International Monetary Fund (IMF) on Tuesday announced it would delay Egypt's USD 4.8 billion loan until next month amid political and social unrest in the country. The decision to postpone review of Egypt's loan request, originally scheduled for December 19th, was made in agreement with Egyptian federal officials. The IMF will review the Egypt's request in mid-January. Egyptian officials have said the IMF loan is necessary to boost investors' confidence, secure more funds and help an economy struggling since last year's uprising. President Mohammad Morsi this week suspended tax increases on some goods to give more time for societal dialogue, and one of his aides said the proposals had sparked public anger. In Washington, the IMF said Egypt had asked for the loan to be postponed "in light of the unfolding developments on the ground". The Fund stood ready to consult with Egypt on resuming discussions on the stand-by loan, a spokeswoman said. State Department spokeswoman Victoria Nuland emphasized "deep concerns" over the situation in Egypt and repeated calls on protesters to demonstrate peacefully and on security forces to act with restraint. "Key stakeholders in Egypt are raising real and legitimate questions, both about the substance and about the process for moving to a constitutional referendum this weekend," Nuland told a news briefing. She declined to answer whether the US believed the referendum itself should be postponed.