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Sunday, December 11, 2011

Egyptian PM breaks into tears while talking about the economy

From Ya Libnan:

Egypt’s new interim prime minister broke into tears in front of journalists on Sunday as he spoke about the state of the country’s economy, saying it was “worse than anyone imagines.”

Egypt’s transition in the months since Hosni Mubarak’s ouster has been rocky, with protests against the military council leading the process, an increase in crime and the battering of the tourism industry that was once a pillar of the economy.

Kamal el-Ganzouri, the third temporary prime minister since Mubarak’s ouster in February, said his priorities were the restoration of security and economic progress.

At one point in his news conference, el-Ganzouri became teary eyed as he recalled seeing “an Egyptian man on TV saying I want security, not bread.”

He said austerity measures were needed to start reducing the deficit but that no new taxes will be imposed. He did not elaborate on exact steps.

El-Ganzouri said his government will not consider loans from the International Monetary Fund until the outlook of the Egyptian budget becomes clear. In the summer, the IMF offered a $3 billion loan, but Egyptian officials turned it down.

The IMF is projecting Egypt’s economic growth to be just 1.2 per cent this year, compared with about 5 per cent in 2010.

“Solidarity is needed to face the economic crisis and security problem for citizens to be pleased with the revolution,” he said.

Urban consumer inflation in Egypt rose to an annual 9.1 per cent in November from 7.1 per cent in October. The unemployment rate in the third quarter climbed to 12 per cent from just under 9 per cent a year earlier. Net international reserves dropped by roughly 40 per cent by the end of October, compared with the end of 2010.
Spengler has been sounding the alarm about this for a while now. Egypt is in deep trouble and the revolution is showing no way for it to extricate itself.