IMF chief hails Egypt austerity, urges approval of $12B loan

The head of the International Monetary Fund praised Egypt's recent austerity measures on Tuesday and called on the world lender's Executive Board to finalize a $12 billion loan package to help rebuild the economy of the Arab world's most populous country.

Egypt's long-running financial woes have worsened in recent weeks amid a dispute with Saudi Arabia, which provided billions of dollars in aid after the military ousted an elected Islamist leader in 2013 but cut off fuel shipments last month over a dispute related to the Syrian conflict.

IMF chief Christine Lagarde praised Egypt's decision last week to float its currency and slash fuel subsidies, measures that have hiked the price of basic goods, but which she said would shore up its reserves, attract foreign investment and reduce its budget deficits.

"The Egyptian authorities have embarked on an ambitious reform program to put the country's economy on a sustainable path and achieve job-rich growth," she said.