Last updated: 21 April, 2012

IMF says loan programs for Arab nations in works

The International Monetary Fund said Saturday it had several loan programs for Arab countries in the works, not giving names but pointing to “Arab Spring” countries as likely recipients.

“We have a commitment to the Arab countries in transition,” IMF managing director Christine Lagarde said, referring to those countries rebuilding after major revolts in the past year.

“A commitment that by our Annual Meeting in Tokyo (in October 2012), we will have several programs in place to help them navigate the transition.

“It will not be enough, it will require other supporters, donors, partners to help financially and in trade opening as well,” she said during the IMF’s Spring Meetings with the World Bank in Washington.

She made no direct mention of Egypt, which is still in talks with the crisis lender over a $3.2 billion loan to help it maintain fiscal stability while undergoing key reforms.

On Friday Masood Ahmed, the head of the IMF’s Middle East and Central Asia department, said the timing of the loan for Egypt depended on whether the country could construct among its disparate political parties broad support for an IMF program, which would likely require tough fiscal, tax and other reforms.

Ahmed said that how quickly the aid could be delivered depends largely on Egyptian authorities and their political partners finding support for the program.

“On our side, we are ready to bring this to closure as quickly as the Egyptian authorities and their partners within the country are ready to bring it to closure,” he said.

“Will that be done in a week, or four weeks, or eight weeks? It’s really hard for me to make a view on that,” he said.

The IMF had indicated during a Group of Eight summit in Deauville, France, in May 2011 that it could make available some $35 billion for the Middle East and North Africa region as countries like Libya and Egypt underwent revolts that overthrew authoritarian regimes.

But since then, it has yet to launch any new loan programs for the region.

Lagarde meanwhile said that, relative to other parts of the world, the Middle East is probably the greatest recipient of IMF technical assistance programs advising on the management of public finances, taxation, and other fields.

“You’d be surprised (by the) dozens and dozens of missions we have fielded over the last couple of years.”