In a speech made in the midst of December clashes between protesters and military and security forces, Prime Minister Kamal al-Ganzouri pledged to exempt Egypt’s farmers from paying off accumulated interest on loans taken from the Principal Bank for Development and Agricultural Credit over the past few decades.
But more than a month later, mixed messages from administrative authorities and conflicting official statements have left farmers concerned that Ganzouri’s promises might have been empty.
Relieving debt interest repayments would go a long way toward alleviating the economic pressures that have plagued hundreds of thousands of Egyptian farmers for years. The value of this accumulated interest is somewhere in the lower hundreds of millions of Egyptian pounds.
The official interest rates on the development bank loans average about 7 percent, however, over the years, compound interest rates have left many farmers buried in debts often tens of times the initial loan value.
“Being exempted from interest debt would allow for much personal business development and expansion as profits could be reinvested into my business, something I haven’t done since I took the loan in 2004,” said Osama El Sayed, a farmer from Daqahlia Governorate.
According to local papers, just days after Ganzouri’s speech, Agriculture Minister Mahmoud Reda Ismail said the Principal Bank for Development and Agricultural Credit is bankrupt and does not have the resources to finance such an initiative, and that other arrangements will have to be made to compensate. Bank Chairman Mohsen Batran immediately responded to deny Ismail's statement, saying that resources are available and that the bank is awaiting instructions to proceed with individual case assessments rather than relinquishing the debts altogether. Many variations of these statements have been publicized over the past month.
Meanwhile, farmers say they are being turned away and ignored by various institutions, including the bank and Agriculture Ministry, when they try to inquire about the initiative.
“It is nothing new for government officials to simply subdue and manipulate rural apprehensions with public statements and false promises, it has been common practice since law changes in 1992 favored private businesses,” said Mahmoud El Mansy, a spokesperson for farmers' rights NGO, Sons of the Soil.
Mansy believes Ganzouri was trying to swiftly curry favor with farmers in his early days in office. He says the Ganzouri statement conveniently came before planned farmers' protests against illegal campaigning, which Mansy says drove farmers who support socialist policies to vote for Islamists.
Neither the Principal Bank for Development and Agricultural Credit, Agriculture Ministry nor Central Bank has received instructions to relinquish the debt. Spokespersons for all of those organizations told Egypt Independent that they had been told not to speak about the issue.
“We hate the [Principal Bank for Development and Agricultural Credit], we never hear from them unless they’re trying to exploit us in some way,” said Sayed. “We don’t want help from any government officials, we don’t even want to fight for our rights either. We just want to be left alone.”
