IMF approves 12 billion bailout for Egypt despite rights concerns

(Vatican Radio) The International Monetary Fund (IMF) has approved a 12 billion dollar loan for Egypt over the next three years to help the country out of its deep economic crisis, despite concerns about social tensions and reports of human rights abuses including discrimination against Christians. 

Listen to the report by Stefan Bos:

The IMF said Egypt had met strict its conditions to receive $2.75 billion immediately, with the rest subject to its economic performance and further reforms. In a statement IMF Managing Director Christine Lagarde said the 12 billion dollar bailout was aimed at "addressing longstanding challenges". Egypt has faced high unemployment and a budget deficit of 12 percent of Gross Domestic Product. 

And the country failed to attract foreign investment since the political turmoil in 2011 and what became known as the Arab Spring, which saw former president Hosni Mubarak overthrown. 

Yet, IMF support comes with a price. The government was forced to introduce austerity measures such as lifting fuel subsidies, which resulted in fuel price hikes of nearly 50 percent, sparking protests. 

FREE FLOTATION

A decision to allow the free flotation of the Egyptian pound also contributed to the highest inflation since 2009. Critics claim Egypt's President Abdul Fattah al-Sisi has been unable to tackle the economic difficulties.  

But Richard Banks, a consulting editor of the Euromoney publication, says the IMF loan could improve the situation. "I think it will enable the Central Bank and the government to effect a resolution of the currency issue within, say, three to six months." 

That's a long time for residents such as Antar Ahmed. "People are fed up. The end is near," he said. "I have five children, I can't get subsidies. We can't buy medicine, fuel and food and everything. How can we afford anything?" 

IMF support for Egypt comes despite concerns over its human rights record, including towards minority Christians, with restrictions over the construction and renovation of churches, anti-Christian violence and ongoing kidnappings of Christian girls and women.