The International Monetary Fund (IMF) has delayed a $4.8 billion loan to Egypt after Cairo postponed belt-tightening economic measures.
This was confirmed by Egypt’s minister of finance, Mumtaz Al Said, on Wednesday, saying the deal was due to be approved in December this year.
This is a huge blow to the Egyptian economy as this money would also be used to develop infrastructure which is buckling under pressure due to an ever-growing population.
It was thought the loan would also boost additional aid and foreign investment which has yet to recover from a massive drop as a result of the on-going uprising.
Reuters reported that the deal delay followed a move to suspend planned tax increases that were criticised by the opposition.
It is understood that the IMF board was scheduled to meet to discuss approving the loan in December 19 after a preliminary agreement was reached during a visit by an IMF team to Cairo last month.
The IMF had said Egypt must keep policy steady for the loan to go through.