Egypt to Replace Finance Minister in Cabinet Reshuffle

Photographer: Andrew Harrer/Bloomberg

Finance Minister El-Morsi Hegazi, seen here, was replaced with Fayad Abdel-Moneim, a professor at Azhar University’s Faculty of Commerce and specialist in Islamic Finance. Close

Finance Minister El-Morsi Hegazi, seen here, was replaced with Fayad Abdel-Moneim, a... Read More

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Photographer: Andrew Harrer/Bloomberg

Finance Minister El-Morsi Hegazi, seen here, was replaced with Fayad Abdel-Moneim, a professor at Azhar University’s Faculty of Commerce and specialist in Islamic Finance.

Egypt replaced two key economic ministers and boosted Islamists’ strength in the Cabinet, in an overhaul that fell short of opposition demands as the country struggles to obtain an International Monetary Fund loan.

Nine new Cabinet members, including the finance and planning ministers, were sworn in by President Mohamed Mursi after he pledged changes last month. Prime Minister Hisham Qandil, targeted by Mursi’s critics, keeps his job while three new ministers have ties to Mursi’s Muslim Brotherhood.

“The reshuffle won’t change anything in terms of the country’s political, economic or security crisis,” Abdel- Ghaffar Shukr, a member of the National Salvation Front opposition alliance, said by phone. “The regime once again chose ministers who are either members of the Muslim Brotherhood or affiliated with the group, while ignoring the opposition demand of appointing independent ministers capable of dealing with the economic, political and security issues.”

Mursi’s secular and youth activist opposition accuses his government of failing to stabilize the nation or realize the goals of the 2011 uprising that toppled Hosni Mubarak. Since then, Egypt has become mired in a polarizing battle between secularists and Islamists, while its economy has grown at the slowest pace in two decades.

‘Limited Impact’

Fayad Abdel-Moneim, a 56-year-old professor at Azhar University’s Faculty of Commerce, replaced Finance Minister El- Morsi Hegazi, according to a Cabinet statement. Ahmed Amr Darrag, a 54-year-old official in the Brotherhood’s Freedom and Justice Party, took over the Planning and International Cooperation Ministry from Ashraf El-Arabi, who has played a key role in talks with the IMF on a $4.8 billion loan. Seven other ministers were also changed, including oil, justice and culture.

There will be no impact on the IMF discussions or “change in the announced government program,” Cabinet spokesman Alaa El-Hadidi said in an e-mailed statement.

The changes will probably “have a limited impact on IMF talks since the Cabinet is likely to be short-lived,” Jean- Michel Saliba, London-based economist at Bank of America Merrill Lynch, said by e-mail. “But the reshuffle tells you that the Muslim Brotherhood sees value in deepening its reach in key ministries that control IMF and multilateral lending. They were probably unhappy with the way the deal was being negotiated.”

Elections Due

Egypt is due to hold elections in October, delayed from last month, and it’s not clear if an IMF accord can be signed before the vote.

Egypt’s currency has weakened as the country ran short of foreign exchange. The pound has dropped more than 10 percent since the central bank started dollar auctions aimed at halting a plunge of more than 60 percent in currency reserves since the end of 2010.

Qandil, appointed premier after Mursi’s election in June, has already changed the finance minister once before, and brought in a new interior minister.

The moves have done little to ease political tensions or concerns about the widening fiscal deficit, cited by Moody’s Investors Service and Fitch Ratings as they lowered Egypt’s credit grade this year.

Three of the new ministers come from the Brotherhood or Freedom and Justice. Yehia Abdel-Samie Hamed, a founding member of the FJP’s external relations committee, takes over at the Investment Ministry, according to the state-run Ahram Gate. Ahmed Mahmoud Ali El-Gizawy, 35, who takes over the Agriculture Ministry, was head of the party’s agriculture committee and is a professor of agriculture at Cairo’s Ain Shams University.

Sherif Haddara, 60, who becomes oil minister in place of Osama Kamal, was head of the Egyptian General Petroleum Corp. He inherits a ministry which is struggling to cope with a fuel shortage and trying to push ahead with subsidy cuts that could further inflame tensions.

List of new ministers: *Ahmed Mohamed Seliman: Minister of Justice *Hatem Abdallah Bagato: Minister of Parliamentary Affairs *Sherif Hassan Ramadan Haddara: Minister of Petroleum *Ahmed Eissa: Minister of Antiquities *Ahmed Mahmoud Ali El-Gizawy: Minister of Agriculture *Fayad Abdel-Moneim Hassanein Ibrahim: Minister of Finance *Ahmed Mohamed Amr Darrag: Minister of Planning and International Cooperation *Alaa Abdel-Aziz El-Sayed Abdel-Fattah: Minister of Culture *Yehia Hamed Abdel-Samie Hamed: Minister of Investment

To contact the reporters on this story: Tarek El-Tablawy in Cairo at teltablawy@bloomberg.net; Alaa Shahine in Dubai at asalha@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net

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