This decision, which was largely anticipated by those following the Egyptian countercoup and the apparent nationalistic tendencies of Gen. Sisi, would reverse a trend that was set in motion decades ago by corrupt Egyptian dictator Hosni Mubarak and accelerated by Muslim Brotherhood fanatic Muhammed Morsi. Under both Mubarak and Morsi, Egyptian standards of living plummeted, prices rose, and economic stagnation took hold. As a condition of the IMF loans, an onslaught of “free-market” reforms, privatizations schemes, and austerity measures began to take place with even more being expected in the future, such as a value-added tax publicly advocated by the Muslim Brotherhood ruling class.
The history of the IMF’s involvement in Egypt is, as it has been everywhere else, a tragic one.
As Jack Shenker of the Guardian wrote in 2009,
Ever since, the country has been subject to successive waves of neoliberal reform. In 1996 a huge privatisation drive kicked off – resulting in sham sales to public banks and regime cronies, a rapid deterioration of working conditions and a wave of strikesso powerful that one analyst labelled it the largest social movement seen in the Middle East in half a century.Then 2004 brought a new cabinet which swiftly cut the top rate of tax from 42% to 20%, leaving multimillionaires paying exactly the same proportion of their income into government coffers as those on an annual salary of less than £500. Special economic zones were created, foreign investment reached dizzying heights ($13bn in 2008) and, in the past three years, economic growthhas clocked in at a consistently high 7%. The minimum wage, incidentally, has remained fixed at less than £4 a month throughout. The global business community applauded Mubarak’s rule as “bold”, “impressive” and “prudent”.
As WSWS notes, after the ouster of Mubarak and the election of the Muslim Brotherhood, “social inequality in Egypt has deepened. Food prices are rising, and more than two decades after the last deal between the IMF and Egypt in 1991, over 40 percent of the population live on less than $2 a day, while a tiny, super-rich layer at the top of society is increasing its fortunes.”
Indeed, the economic crisis only escalated when the corrupt, fanatical, and incompetent Muslim Brotherhood took power, pursuing Mubarak’s legacy of yet another deal with the IMF which would have lead to even further tragic consequence for the average Egyptian. From attempts to remove subsidies on necessities like food and oil, the raising of the sales tax, and the implementation of a value-added tax, the Muslim Brotherhood’s economic program was an abysmal failure.
Thus, with the recent announcement by the interim Egyptian government of the abandonment of any request for a loan from the IMF, many analysts have predicted “the process of a historic re-orientation, last seen in the early 1970s.”
One of the most notable aspects of this possible “re-orientation” would be a significant turn away from a close relationship with the United States and a pivot toward Russia as the nation seeks to regain its prominence that it once experienced during a period where it was free from the yoke of the United States.
In a rather frank statement, Egyptian Minister Abdel-Nour pointed out that Egypt “is currently facing a plot, which appears clearly through the terror acts and stances of some international media outlets against the government and democracy.” Although Abdel-Nour did not elaborate (or if he did his elaborations were not reported), it is largely understood that the Minister is referring to the Anglo-American powers that have not only attempted to control Egypt for the last several decades but to destabilize it no less than twice in the last two years, even attempting to use it as a spearhead military force against Syria and Ethiopia.
Furthering suspicions regarding Egypt’s turn toward Russia and away from the United States, Egyptian Foreign Minister Nabil Fahmy stated on September 16, during his visit to Russia that “Egypt appreciates Russia’s “supporting stance to the Egyptian people’s will”. Fahmy also stated that “Egyptian foreign policy is seeking to develop relations with Russia, boost bilateral cooperation and enhance mutual interests”.
Fahmy’s statement regarding the unfolding crisis in Syria – with the United States and the rest of the Anglo-American world foaming at the mouth to take military action against Syria – was likewise revealing. In regards to the latest Russian initiative to seek diplomatic solutions to the chemical weapons controversy (which has been entirely organized and fabricated by the West from the very beginning), Fahmy stated that “If this initiative should be successful, it would become the most important element for the protection against the threat of a division of the Middle East, as it occurred after the first World War. Should a military solution for solving the crisis be chosen, it would bring the real threat of splitting parts of the Eastern Mediterranean region”.
When one observes the developments taking shape in Egypt on a singular and individual basis, it might appear at first glance that the nation is experiencing the same turmoil and unstable political life that many Middle Eastern nations are currently experiencing across the region. However, when one steps back and takes a look at the bigger picture, it seems that what is taking place in Egypt is indeed more than a simple confluence of circumstances but a true realignment of political power both within and outside the country. If Egypt takes a turn towards nationalism and Nasserism then the Anglo-American world will necessarily find itself another center of resistance to global hegemony in the Middle East.