Kerry: Egypt needs political, economic viability

Egypt’s bickering government and opposition need to create “a sense of political and economic viability,” giving businesses confidence and setting the stage for a vital international aid deal, U.S. Secretary of State John Kerry said Saturday.

Kerry stressed to business leaders the importance of Egyptians coming together around human rights, freedom and speech and religious tolerance. Equally essential, he said, is uniting “to meet the economic challenge of this particular moment.”

He arrived in Cairo, the latest stop on his first overseas trip as a member of President Barack Obama’s second-term Cabinet, intending to press all sides to come to a basic agreement on Egypt’s direction ahead of parliamentary elections that begin next month.

Of great concern, too, is the ability of Egypt to undertake the reforms necessary to qualify for a $4.8 billion International Monetary Fund loan package. Steps could include increasing tax collections and curbing energy subsidies.

Agreement with the IMF, contingent on ending the political chaos that has ensued since President Mohammed Morsi’s election, would unlock significant U.S. assistance, including portions of Obama’s $1 billion pledge last April.

“It is paramount, essential, urgent,” Kerry told business leaders, “that the Egyptian economy gets stronger, gets back on its feet and it’s very clear that there is a circle of connections in how that can happen.

“To attract capital, to bring money back here, to give business the confidence to move forward, there has to be sense of security, there has to be a sense of political and economic viability.”

Kerry, who was to meet with Morsi on Sunday, said he would tell the president that that U.S. assistance would depend on Egyptian reforms and the IMF agreement.

“It is clear to us that the IMF arrangement needs to be reached and we need to give the market place some confidence,” Kerry said.

Several hundred people protested outside the government offices where Kerry planned to meet with Foreign Minister Amr Kamel. They burned Kerry’s pictures and chanted that Washington was siding with Morsi’s ruling Muslim Brotherhood.

The political turmoil has scared away tourists and foreign investors, eroding Egypt’s foreign reserves by nearly two-thirds of what it was before the uprising. Those reserves, which stand at less than $14 billion, are needed to pay for subsidies that millions of poor Egyptians rely on for survival.

Kerry met with opposition figures before a round-table discussion with members of the business community. He described the first session as “very, very spirited.”

According to the U.S. State Department, Kerry also spoke by telephone with Mohammed ElBaradei, a Nobel laureate who heads the National Salvation Front, an opposition coalition calling for an election boycott.