Egypt should refuse IMF loan: leftist leader

Egypt, battling economic stagnation, rising inflation and unemployment, has twice balked at raising sales tax on all goods and services and slashing fuel and food subsidies.

Egypt should refuse IMF loan: leftist leader

World Bulletin/News Desk

Egypt should refuse a $4.8 billion loan from the International Monetary Fund rather than submit to terms that would further impoverish the poor and could spark a revolution of the hungry, leftist leader Hamdeen Sabahi said on Monday.

Sabahi, 58, who came third in a presidential election last year after the 2011 uprising that toppled autocratic President Hosni Mubarak, told Reuters that neither the global lender nor Egypt's government had told the public the truth about austerity conditions attached to the proposed loan.

The firebrand leader of the Popular Current movement met an IMF team that visited Cairo this month for talks which ended without an agreement partly due to a lack of political consensus to support the accompanying economic reform programme.

Asked whether he would agree to the IMF's conditions, Sabahi said: "No. I would not agree to them."

"If you look at any country the IMF has gone into, you will find that poverty has increased," he said in an interview in his modest 13th-floor apartment in a middle-class district of the capital. "Talk about plugging a budget deficit does not get food to the people."

The conditions for an IMF loan have not been made public but Egypt, battling economic stagnation, rising inflation and unemployment, has twice balked at raising sales tax on all goods and services and slashing fuel and food subsidies.

"If the political situation remains unchanged, the Jan. 25 (anti-Mubarak) revolution will be followed by a new wave that could erupt due to poverty once the IMF conditions are implemented and there will be a revolution of the hungry," Sabahi said.

The only political memento on his living room walls was a painting of Gamal Abdel Nasser.

Sabahi models himself on Nasser, who carried out a major land reform, nationalised the Suez Canal, but also waged a relentless crackdown on the Muslim Brotherhood, which now rules Egypt.

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Jailed several times for dissent and pro-democracy activism under Mubarak and former President Anwar El-Sadat, Sabahi often defended the Brotherhood under autocratic rule, and he campaigned alongside them in Mubarak-era parliament elections.

He now accuses President Mohamed Mursi and the Brotherhood of trying to monopolise.

Asked whether his movement would participate in parliamentary elections due later this year, he said it was up to Mursi to create the conditions by changing the government, replacing a controversial prosecutor general and passing an election law.

Critics say Sabahi’s economic outlook is stuck in a Nasserite time warp.

In the interview he rejected fears that he would nationalise private businesses, as Nasser had done, saying his goal was to make poor people richer rather than rich people poorer.

In his presidential campaign, Sabahi advocated state ownership of big industrial projects, minimum and maximum wages and a one-off wealth tax to fund development.

Last Mod: 30 Nisan 2013, 10:10
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