By Nick Mann | 22 August 2012

The International Monetary Fund has said it will respond quickly to a request from Egypt for financial support to help kick-start the country’s economy.

Speaking today at the end of a visit to the Egyptian capital Cairo, IMF managing director Christine Legarde said the fund remained committed to supporting the country during its ‘historic period of transition’.

The IMF would ‘accompany Egypt as it undertakes this challenging journey,’ she said, highlighting the ‘strategy and ambition’ of the government led by President Mohamed Morsi and Prime Minister Hesham Kandil.

Egypt’s newly elected government is reported to have requested a $4.8m loan from the IMF, significantly more than the $3.2m initially asked for last year.

In a statement, Legarde said: ‘The authorities have indicated that Egypt would like the IMF to support Egypt’s economic programme financially to help the country recover and to lay the foundation for strong growth that benefits all. We are responding quickly to this request.

‘A technical team will be arriving in Cairo in early September to work with the authorities on their programme and discuss possible forms of financial support from the IMF.

Egypt faces considerable challenges, Legarde explained, including the need to restart growth and reduce both its budget and balance of payments deficits. In both 2010/11 and 2011/12, its budget deficit was an estimated 9.8% of gross domestic product and it is forecast to be 7.6% in the current financial year.

Legarde added: ‘Getting the country’s economy back on track and raising the living standards for all will not be an easy task. The Egyptian people have legitimate expectations for a better life and greater social justice. We at the IMF stand ready to help.’