Egypt's prime minister presents economic program, aiming for 3.5 per cent growth

Egypt's prime minister laid out Tuesday his government's economic program, aiming to increase a sagging growth rate, restructure an expensive subsidy system and deal with a crippling budget deficit as the country negotiates a $4.8 billion loan from the International Monetary Fund.

Egypt's economy plummeted following last year's uprising that toppled former President Hosni Mubarak. Growth rates dropped and foreign reserves, currently at just under $15.5 billion, a drop of nearly half over the past 18 months, as tourism revenues and foreign investment shrank.

Egypt's government sees the IMF loan as a way to raise investor confidence, reduce its budget deficit currently at 11 per cent of GDP, and open other avenues for financing from international donors. A deal is expected before the end of the year. An IMF team is in Egypt to discuss the government's economic program and negotiate a deal.

The proposed loan has drawn criticism from some groups in Egypt who said the negotiations with the IMF lacked transparency and raised concerns that it would lead to an economic crunch and inflation that would further harm the poor. Some 40 per cent of Egypt's 83 million people live on less than $2 a day.