Egypt Independent

World Bank head expects ‘tensions’ over US$1bn loan



The head of the World Bank expects “tensions” as Egypt negotiatesa US$1 billion loan with the international lender, which could emerge if Egypt does not meet the lender's demands for progress in transparency and democracy.

World Bank chief Robert Zoellick expressed concern over the power of the ruling Supreme Council of the Armed Forces, which he said is “part of the former regime,” as well as the Muslim Brotherhood, whose political party took a near-majority of seats in the newly elected lower house of Parliament.

“They're reaching out to us, to try to see about financial support,” Zoellick said during an appearance at Carnegie Mellon University in the US city of Pittsburgh Tuesday, mentioning that Egypt's foreign reserves have fallen by more than half since the 25 January uprising began early last year.

“But if we do provide initial financial support to the government in general, we will want … to make sure it's transparent, that it relates to some of the changes that people were calling for or a broader social accountability. And there'll be tensions with that,” Zoellick said.

Zoellick acknowledged that negotiations over the loan are taking place in a country filled with pride, nationalism and sensitivity to international intervention. He said while he is optimistic by nature, he is also realistic about the situation.

On 2 February, Egypt requested a $1 billion loan from the World Bank for development programs. The World Bank had promised last May that it would be willing to grant Egypt up to $4.5 billion over two years based on the speed and comprehensiveness of its reforms.

Translated from Al-Masry Al-Youm