Egypt raises import duties to boost chances of IMF loan | Business| Economy and finance news from a German perspective | DW | 25.03.2013
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Egypt raises import duties to boost chances of IMF loan

Egypt has raised customs duties on a wide range of goods in a bid to secure a badly needed loan from the International Monetary Fund. However, the Egyptian president has tried to avoid popular anger over the move.

Egypt's president, Mohammed Morsi, issued a decree to raise import tariffs on a wide range of what Cairo described as "non-essential consumables."

Among the goods affected are fireworks, watches, video games, seafood, gambling tables and sunglasses and luxury items. According to the newspaper "Al-Ahram," import duties on those goods would be raised from 5 percent currently to a range between 10 to 40 percent.

The government made sure only goods not needed urgently were affected by the hike so as to avoid triggering a public outcry.

Shot in the arm required

The customs increase was meant to improve the ailing country's public finances and with it the nation's chances of securing a $4.8-billion (3.7-billion-euro) loan from the International Monetary Fund (IMF).

A previous attempt to wash more money into state coffers came to nothing as Cairo almost immediately withdrew a sales tax hike after announcing the measure in December of last year.

IMF Middle East Director Masood Ahmed said discussions would continue over the coming weeks with the aim of reaching agreement "on possible financial support." Egypt's economy has been hit hard by the instability that came in the wake of the 2011 uprising forcing autocratic ruler Hosni Mubarak from power.

hg/kms (AP, dpa)