From an open letter to the IMF and the prime minister of Egypt now circulating:
Dear Dr. Qandil and Ms. Lagarde,
We, the undersigned civil society groups and political parties, are writing to express our concerns about the proposed $4.8 billion International Monetary Fund (IMF) loan to Egypt that is currently under negotiation. We reject the loan negotiations on the following basis:
The negotiations of the terms and conditions of the loan agreement, including the government’s economic reform program, have lacked transparency on the part of both the IMF and the Government of Egypt. Moreover, these negotiations have continued in the absence of an elected parliament, which was dissolved on 14 June 2012, and with the president of Egypt holding full legislative authority. Any agreement under these circumstances would contravene the democratic principle of separation of powers and Egypt’s longstanding constitutional requirement of parliamentary oversight over executive decisions.
Furthermore, the public consultations carried out by the government to date to solicit societal feedback on the loan have been exclusionary and inaccessible. They do not fully represent Egypt’s civil society and political groups.
There is no clarity on the part of the government about how the loan will contribute to a national economic plan of inclusive growth and social justice that addresses the structural problems of the Egyptian economy and meets the needs of the Egyptian people. We worry that this potential loan agreement and the policies connected to it will represent a continuation of the old regime’s economic policies, particularly as they relate to the incursion of debt. The austerity measures associated with this potential loan agreement, including cutting subsidies as well as other deficit reduction policies, may aggravate the economic deprivation of a large section of the population, threatening their basic economic and social rights.
With little transparency and no clear economic program, the potential loan agreement continues to lack the “critical mass” of support that the IMF requires as a necessary condition for financial assistance. For that reason, we believe that negotiations for the proposed loan should be frozen.
Full letter here. [PDF]
Even if you think the IMF bill is necessary (a cash influx certainly is) it is rather puzzling why the IMF would not go ahead without parliamentary approval six months ago but is ready to steam ahead now.