♠ Posted by Emmanuel in IMF,Middle East
at 1/29/2013 03:20:00 PM
The facts of the matter are as follows:(a) The IMF wanted Egypt to achieve "broad-based domestic and international support" for reform prior to lending $4.8 billion or so to the country in a statement dated 20 November 2012;
(b) Since then, the Islamic fundamentalist regime of Muhammad Morsi has instead made things worse in terms of securing domestic cooperation by ramrodding a largely Muslim Brotherhood-designed constitution near year-end 2012;
(c) Fearful that implementing austerity measures alike the removal energy subsidies would further inflame the passions of an already restless and growing opposition, Morsi delayed seeking the disbursement of a tranche of the $4.8 billion stand-by agreement;
(e) This delay will likely require the renegotiation of terms of the earlier staff-level agreement:
Egypt must now renegotiate some terms of the accord, and economists say the IMF board's approval is not a certainty - especially if there is any sign of government wavering over implementing what are likely to be unpopular conditions. Confronted by lethal street violence after Mursi awarded himself sweeping powers in November, the president postponed planned tax increases seen as part of a package of austerity measures needed to secure the IMF loan.
While any specific terms are yet to be made public, any IMF demands to cut spending or remove price subsidies will be hard to sell to an already fractious population ahead of parliamentary elections, more than two years after Hosni Mubarak was ousted in 2011 after 30 years in power.(f) In the meantime, Egypt's economic situation worsens as the "peace and order situation" deteriorates;
(g) Having run out of Middle Eastern benefactors to tide it over with loans until the IMF finally lends Egypt money and its effective seal of approval, economic pressure to oust Morsi becomes extreme;
(h) At the moment, the IMF is twiddling its thumbs and asking the government to somehow convince the electorate about Egypt's need for its loans;
I think the endgame here is obvious if the IMF doesn't come in soon: Egypt runs out of money for day-to-day government operations and to pay for imports shortly thereafter. Although the IMF will never, ever say so outright, given that no less than regime survival is at stake with the stand-by agreement, its dilly-dallying ultimately means only one thing: The IMFs overlords alike the United States may likely be playing at another regime change given Morsi's utter inability to gain consensus among disparate groups.
Is it a game of throw the bums out, silence of the IMF style? Say what you will of Mubarak, but he toed the line for a long, long time. If the United States calculates that Mursi is unwilling or unable to do so, well, you might as well get rid of him at the current time--vide the current impasse which seems to be by design. He is not a particularly "useful idiot" as the saying goes. Already certain sources speak of delaying the loan by several months; given the dire situation Egypt finds itself in, who would bet against another regime change by then as the IMF's benefactors take their chances with another faction?
However, government sources close to the negotiations process said IMF has indicated a desire to postpone making any decisions on the loan until after parliamentary elections, which are slated to take place at some point within three to four months.So much death, destruction and disorder for what particular end? As I said before, don't the white people wish they had Mubarak back right about now? Otherwise, they'll have the next joker (please).
