The International Monetary Fund (IMF) has approved a second tranche of a $12 billion loan to Egypt, AFP reported Friday (July 14th).
In a statement on Thursday, IMF managing director Christine Lagarde said the approval of the roughly $1.25 billion tranche showed "the IMF's strong support for Egypt" in its efforts to enact tough economic reforms.
The IMF and Egypt had agreed the loan last November, as Egypt devalued the pound and after it introduced a value-added tax in a bid to boost government finances and its foreign reserves.
Egypt also has slashed fuel subsidies, most recently last month.
"We believe that these efforts will yield results," Lagarde said in the statement.
"The authorities' immediate priority is to reduce inflation, which poses a risk to macro-economic stability and hurts the poor," IMF acting chairman David Lipton said in a statement. "The Central Bank of Egypt has taken significant steps to reduce inflation by raising policy interest rates and absorbing excess liquidity."
