On Monday Egypt’s Islamist government greeted International Monetary Fund (IMF) officials in Cairo to discuss terms of a $4.8 billion loan. President Mohamed Mursi, Prime Minister Hisham Kandil and new Egyptian finance minister Al-Mursi El-Sayed Hegazy met with IMF Middle East and Central Asia Department Director Masood Ahmed.
Both sides announced their commitment to conclude the deal in the coming weeks, and a technical team of the IMF will arrive in Cairo in the coming days. Hegazy, a US-trained economist appointed as finance minister by Mursi in a cabinet reshuffle on Sunday, announced that he was “completely ready to complete discussions” with the IMF.
Ahmed declared that “the IMF remains committed to support Egypt in addressing its increasing economic challenges and moving towards a more inclusive model of economic growth.”
A stand-by agreement (SBA) between the IMF and Egypt was already struck in November. However, the Egyptian government proposed to postpone the final conclusion of the deal, amid mass protests against Mursi and the ruling Islamist Muslim Brotherhood (MB) before the constitutional referendum in December.
Confronted with hundreds of thousands of workers and youth demanding the fall of Mursi and the ruling MB, the Egyptian government shied away from concluding the deal and implementing deep austerity measures demanded by the IMF.
The Egyptian bourgeoisie is aware of the social and political consequences of bringing the IMF back to Egypt. Free-market reforms, economic liberalization, and privatization programs worked out between the IMF and the Egyptian ruling elite over more than three decades laid the ground for the revolutionary mass struggles which ousted former dictator Hosni Mubarak in February 2011.