Piety versus expediency: Egypt Islamists change tack on IMF loan
Piety versus expediency: Egypt Islamists change tack on IMF loan (Photo: Center of Socialist Studies)
Egypt's Islamist politicians seem to have had a rapid about-face with regards to a prospective multi-billion dollar loan from the International Monetary Fund.
Before an Islamist held high office, many religious conservatives poured scorn on the idea of borrowing from the international institution, an idea mooted by the transitional government of Essam Sharaf in spring 2011.
Some politicians called such a measure 'haram'; others suggested there was no need for IMF funding and the budget shortfall could be made up in other ways.
Now, with leading figure of the Muslim Brotherhood President Morsi holding the presidency, the Brotherhood affiliated Freedom and Justice (FJP) and Salafist Nour parties both seem to be backing the government's request for a facility from the IMF.
A request was made last week for a $4.8 billion loan during a Cairo meeting between President Morsi and the fund's chief Christine Lagarde.
Below, Ahram Online below compares the Islamists' stances to IMF funding before and after Morsi's election.
Before
In February 2012, the FJP's official website quoted Ashraf Badr Eddin, deputy of the planning and budget committee of the now-dissolved People's Assembly, as saying Egypt did not need IMF loans.
Badr Eddin explained that there were alternatives that could bring in greater revenues than the loan. These include amending international gas-sale agreements, raising energy prices for energy-intensive factories, reviewing the subsidies system, and collecting tax arrears.
In March, when former prime minister Kamal El-Ganzouri and his government were taking steps to attain IMF funding, Saad El-Husseini, a leading member of the FJP told Reuters that the government should first seek all other means to improve its standing. He suggested "selling Islamic 'bonds' to foreign institutions and land to Egyptians abroad, as well as slashing subsidies to energy-intensive industries."
El-Husseini rejected the economic reform programme proposed by the government to qualify for the loan, saying it made no provisions for maintaining foreign reserves at their current, depleted level, let alone raising them. He also called the government's plans for revising energy subsidies "very ambiguous."
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