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Former Egypt minister: ‘loan outcomes will be disastrous’

May 14, 2020 at 1:00 am

Former Egyptian Minister of Investment Yehia Hamed [Facebook]

Former Egyptian Minister of Investment Yehia Hamed announced that: “The insistence of the coup regime leader, Abdel-Fattah Al-Sisi, to move forward with the policy of borrowing from the International Monetary Fund (IMF) and other parties, will have severe economic repercussions on the Egyptian citizens during the coming period,” stressing that “the Egyptian regime has excelled in borrowing and indebting the country, as it lacked other options or tools, except for asking for more loans.”

In an exclusive interview with Arabi21, Hamed stressed that: “The economic reform programme in Egypt adopted by the IMF at the end of 2016 did neither contribute to improving the living standards in Egypt, and create new job opportunities, nor did it achieve real growth at all. However, we can say that this programme bears many negative effects that would overburden the Egyptians, and will have severe repercussions for future generations.”

He continued: “The loans that the IMF granted to the Al-Sisi regime were not reflected in any way on the education or health systems. We are still suffering in Egypt from a very worn out educational system and a very dilapidated health sector, despite all these loans and billions of dollars that the regime received from the IMF, some Gulf countries, international markets and other parties.”

READ: Fuel subsidies decline 65% in Egypt 

Hamed noted that: “The regime is repressing the Egyptians without mercy, and will leave them suffering to the greatest extent, by deliberately pursuing a strategy that aims at impoverishing the citizens, so that they do not demand the least of their legitimate rights.”

On Monday, the Executive Board of the IMF granted its approval to provide emergency financial assistance to Egypt for about $2.8 billion as a first tranche (without specifying the interest rate and the repayment period). The loan is dedicated to meeting the urgent financial needs that resulted from the outbreak of the coronavirus pandemic.

Pro-regime media figure, Ahmed Moussa, explained that the second tranche will be handed over next June, revealing that the total value of the loan will reach more than $7 billion.

Sisi’s new taxes – Cartoon [AlArabi21News/Twitter]

Hamed pointed out that: “The $2.8 billion-loan obtained by the Egyptian authorities, and the ongoing efforts to obtain another one at the value of $5.5 billion, indicates the depth of the economic crisis experienced by the Egyptian state, and exposes the lies that the governor of the Central Bank tried to promote three months ago, saying that the economy has recovered and the state no longer needs any new loans to sustain it.”

The former minister stated that: “The new loans granted by the IMF to the Egyptian government will evaporate and disappear like the other ones, and will not sustain the Egyptian economy for too long. Unfortunately, the citizen will be overburdened by taxes and lifting subsidies, and will suffer from a continuous rise of goods and services prices. Everyone will be subjected to an agonising policy of impoverishment at a time when the government has acknowledged that economic revenues are declining significantly.”

READ: Sisi is using Covid-19 to increase his power, so pity the poor Egyptians 

Last week, the Minister of Finance Mohamed Moait acknowledged that the state suffered significant revenue loss, where a decrease of 75 billion Egyptian pounds occurred, including 65 billion Egyptian pounds as a result of a decrease in the tax revenue, while indicating that the country has been burdened with significant financial and economic charges, due to the outbreak of the coronavirus pandemic.

Hamed questioned: “Why didn’t anyone ask about the impact of the $12 billion that Al-Sisi’s regime got from the IMF? Or where has that money and many other funds gone?”

The former minister criticised the position of the IMF and the statements made by the organisation’s officials, which he saw as: “Clear political support for Al-Sisi’s regime, despite its failure to implement successful policies and recurrent setbacks at all levels.”

Hamed added: “Although the military regime has taken over all the economy, Al-Sisi’s failing fascist regime is operating with the blessing and support of some international powers that have an interest in plunging Egypt into more debt in order to subjugate the country’s national sovereignty to their conditions and policies, and so that we remain in a state of dependence forever.”