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IMF agrees $3bn financing deal with Egypt

The International Monetary Fund (IMF) has agreed a $3bn (£1.8bn) loan deal with the interim government in Egypt.

The IMF praised the government's attempts to stabilise the economy since the uprising that toppled President Hosni Mubarak in February.

The uprising scared away tourists and investors and cut tax revenues, which has left the government short of cash.

The deal must still be approved by the IMF's board and Egypt's cabinet and military council.

Last week, the government approved its 2011-12 budget, which raised spending by a quarter.

Much of the increased spending went on helping low-income households.

The growing gap between rich and poor was one of the factors that sparked the protests in February.

The IMF praised the budget, saying it went, "in the right direction of supporting economic recovery, generating jobs and assisting low income households, while maintaining macroeconomic stability".

BBC News

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