Parliament committee stipulates Ganzouri cabinet would not use full IMF loan

The People's Assembly Economic Affairs Committee linked its final approval of the IMF loan to assurances that the cabinet of Prime Minister Kamal al-Ganzouri will not be allowed to use the whole sum. The loan would be $US3.2 billion and is expected to be paid in stages.

Deputy head of the committee Abbas Abdel Aziz said Friday the committee has notified the cabinet and stipulated that in order for Parliament to approve the taking the loan, Ganzouri's cabinet should be allowed only to spend the first payment.

In a new escalation against the current cabinet's efforts to borrow from the IMF, Abdel Aziz stressed in a statement to Al-Masry Al-Youm the need to provide alternatives for the loan even if Parliament approves the cabinet's request.

Abdel Aziz said there are other alternatives, like putting up dollar bonds and offering pieces of land to Egyptian expatriates for purchase.

He said that settlement with Gulf and Egyptian companies who had bought land at low prices and are waiting for the re-evaluation of land prices is an alternative that cannot be depended upon, although it could be an alternative on the long term.

Abdel Hafiz al-Sawy, head of the Freedom and Justice Party's economic committee, said that the party continues to reject approving the cabinet’s request for the loan without revealing aspects of disbursement and repayment.

Sawy said the party had no ideological barriers against dealing with international financial institutions that Egypt contributes to and has the right to borrow from, but that the issue has to do with how the loan will affect the next cabinet and the potential for stability following the presidential election.

He added that all the loans the current cabinet seeks will total around US$11 billion, a sum that will raise Egypt's debt by 33 percent in one year.

Edited translation from Al-Masry Al-Youm

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