CAIRO — Egypt swore in 10 new ministers on Sunday in a Cabinet shake-up aimed at improving the government’s handling of the country’s ailing economy ahead of talks this week with the International Monetary Fund over a badly needed $4.8 billion loan.
The reshuffle, which President Mohammed Morsi had promised in response to public anger over Egypt’s economic malaise, affected two key ministries, the interior and finance. It also solidified Islamist control of the government, putting three portfolios in the hands of members of the president’s Muslim Brotherhood.
The dire state of Egypt’s economy was punctuated Sunday by new central bank figures that put December’s foreign-currency reserves at $15.01 billion, down $26 million from a month earlier. The reserves have dropped by more than half since the uprising that ousted longtime ruler Hosni Mubarak in February 2011.
The central bank said last month that current reserve levels represent a “critical minimum.”
Morsi met with the new ministers after their swearing-in ceremony at the presidential palace in Cairo where they discussed ways to revive tourism and attract foreign investors, a presidential official said, speaking on condition of anonymity because he was not authorized to brief the media.
Prime Minister Hesham Kandil, meanwhile, said he stressed in his first meeting with the new ministers the need for immediate action to stabilize the economy.
At the heart of those efforts lies the $4.8 billion loan that Egypt has requested from the IMF. Cairo says the funds are needed to bolster confidence in the country’s economy and attract foreign investors.
Egypt asked the IMF for a delay in the talks on the loan after political turmoil began in December over a contentious new constitution. Mass protests and street violence tied to the constitution dealt yet another blow to major foreign currency earners, including tourism and foreign investment.
The unrest also sparked a rush on U.S. dollars by worried residents and led to a drop in the Egyptian pound, which shed nearly 4 percent of its value against the dollar over the past two weeks.
The opposition, a coalition of liberal, secular-leaning, and leftist groups, was not offered any seats in the new Cabinet and has said that any government shake-up that doesn’t replace Kandil falls short of what is needed.
El-Morsi Hegazy, a professor of public finance at Alexandria University, takes over the Finance Ministry, replacing Mumtaz el-Said, who was appointed by the country’s transitional military rulers and widely viewed as being at odds with the Brotherhood.
Mohammed Ibrahim will lead the Interior Ministry, which is responsible for the police force. He previously was in charge of prisons and before that was director of security in the province of Assiut, which has a large Coptic Christian population and has also been home to a number of Islamic militant groups.
Ibrahim said his priorities will be to fight a rising wave of crime and restore stability to Egypt.
“We will strike with an iron fist against anyone that threatens the security of the nation and Egyptians,” Ibrahim told the state news agency, pledging to clamp down on cross border weapons smuggling. Egypt has been flush with weapons smuggled from Libya and Sudan.
Three of the new ministers are from the Brotherhood, according to the spokesman for the group’s Freedom and Justice Party, Ahmed Subaie. They take over the ministries of transportation, local development and supply and interior trade, giving the Brotherhood a total of eight Cabinet posts.
Also included in the reshuffle were the ministries of civil aviation, environment, electricity, communication and parliamentary affairs.
With the new Cabinet set, Kandil said he will meet with IMF officials today “to reassure them about Egypt’s situation and economic recovery in the coming period.”
Egyptian officials have said the country’s budget deficit is likely to reach $31.5 billion by mid-2013.
Information for this article was contributed by Sarah El Deeb of The Associated Press.
Front Section, Pages 4 on 01/07/2013