April 3 (Bloomberg) -- Egypt’s leaders rejected U.S. charges that they are stifling free speech, a dispute that has clouded Egyptian efforts to nail down a $4.8 billion loan from the Washington-based International Monetary Fund.
Loan talks resumed today, two days after State Department spokeswoman Victoria Nuland set off a furor in Egypt by calling the arrest warrant against comedian Bassem Youssef an example of increasing restrictions on free speech. Youssef, known as Egypt’s Jon Stewart, was accused of insulting the Islamic faith and President Mohamed Mursi and released on bail.
Mursi’s presidential office said on its Facebook page today that “all citizens are free to express themselves without the restrictions that prevailed” under longtime leader Hosni Mubarak, who was ousted in the 2011 popular uprising. Mursi’s first legislation was to eliminate the pre-trial detention of journalists, it said.
Yesterday, Egypt’s governing Islamist party called the U.S. comment “blatant interference.”
The latest strain on ties between Egypt, a key American ally under Mubarak, and the U.S. came as an IMF team arrived in Cairo today to resume talks on the loan request, which itself has become a source of friction between Mursi and his critics. Some opposition groups planned to protest against the talks today, maintaining the loan would only add to Egyptians’ burdens.
Prime Minister Hisham Qandil said today the government hopes to reach a deal during the visit that will help to revive Egypt’s economy, which stalled after the uprising and continues to sputter as political tensions between Mursi’s secular critics and ruling Islamists keep investors and tourists away.
“We have made good progress in recent weeks and we look forward to building on that work,” Masood Ahmed, the IMF’s Middle East and Central Asia department chief, said in e-mailed comments late yesterday.
Yields on Egypt’s benchmark dollar bonds exceeded 8.6 percent this week, the highest since January 2012, and the currency has declined and foreign reserves plummeted. The main stock index fell for a fourth day today, dropping 1.4 percent to the lowest level this year. The country’s foreign currency reserves of $13.5 billion at the end of February are enough to cover roughly three months of imports.
The IMF has said it wants to see broad political consensus for an economic program before the deal. So far there has been little of that. The Popular Current, a secular party that’s part of the opposition National Salvation Front bloc said it opposes the loan, in a statement to the IMF on its Facebook page.
“We reject your visit, your loan and your anti-poor prescription,” it said. The loan “will lead to the continued subjugation of the Egyptian economy” and the “vast majority of Egyptians are going to bear its consequences.” The party said it would participate in anti-IMF protests today.
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