Sunday,22 July, 2018
Current issue | Issue 1168, (10 - 16 October 2013)
Sunday,22 July, 2018
Issue 1168, (10 - 16 October 2013)

Ahram Weekly

Rebuffing the IMF

The annual autumn meetings of the World Bank and IMF will see limited Egyptian representation, reports Nesma Nowar 

Al-Ahram Weekly

In a statement made last week, Prime Minister Hazem Al-Beblawi said that Egypt would be represented by diplomats only at the annual autumn meetings of the International Monetary Fund (IMF) and World Bank, which start today in Washington and end on 12 October.
A cabinet statement on Friday said that the Egyptian government had received an invitation to attend the meetings, but it would not be attending this year’s gatherings at the government level and would only be sending diplomatic representation.
Such meetings are usually attended by a number of ministers headed by the minister of finance or prime minister.
Al-Beblawi said that Egypt had reduced its representation at this year’s meetings as a way of objecting to the way Egypt had been treated by the international organisations.
In a telephone interview with a private local TV channel he said there had been “confusion” concerning Egypt’s representation due to the recent political changes and that there had been a motion to request to vote on Egypt’s attendance at the meetings.
An IMF spokeswoman told Al-Ahram Weekly via email that the Egyptian authorities were able to register for the meetings as soon as “IMF management determined that members representing a majority of the IMF’s voting power deal with the interim government as the government of Egypt and therefore that the IMF could do likewise.”  
She added that the level of Egypt’s representation at the annual meetings was determined by the national authorities, pointing out that IMF staff looked forward to the opportunity to discuss the country’s economic policy challenges with the Egyptian authorities and that the IMF remained committed to helping Egypt.
Mohamed Hassan, an associate professor of economics at Cairo University, agreed with Al-Beblawi’s decision to reduce Egypt’s representation, on the condition that the Egyptian ambassador to Washington, who is set to attend the meetings, is provided with the information necessary to adequately present the situation in Egypt.
Hassan was in favour of resuming talks with the IMF over a long-negotiated $4.8 billion loan. This was not because of the amount — Egypt had recently received $12 billion in Arab aid — but to give a vote of confidence to the economy in the eyes of the international community.
“Gaining international confidence in the economy is indispensable,” he said.
However, resuming negotiations with the IMF was not feasible for the time being, Hassan added. The country lacked a political consensus, and the government would not be able to carry out the austerity measures that might be requested by the IMF in the present context “because they will have high political costs”.
Egypt started talks with the IMF in 201l, following the 25 January Revolution, over a $3.2 billion loan, a sum that was later increased to $4.8 billion. The government has held sporadic talks with the IMF since then, and in November 2012 Egypt reached a staff-level agreement with the IMF’s technical team for the loan.
However, further negotiations for final approval have been consistently delayed due to the unstable political conditions in the country, and they were suspended following the 30 June Revolution and the toppling of former president Mohamed Morsi.

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