Posts Tagged Monday

Egyptian Military give Morsi 48-Hour Deadline

President Mohamed Morsi

 

Egypt’s powerful military warned on Monday it will intervene if the Islamist president doesn’t “meet the people’s demands,” giving him and his opponents two days to reach an agreement in what it called a last chance. Hundreds of thousands of protesters massed for a second day calling on Mohammed Morsi to step down.

Military helicopters, some dangling Egyptian flags, swooped over Cairo’s Tahrir Square where many broke into cheers with the army’s announcement, read on state television. The statement seemed to fuel the flow of crowds into city squares around the country where protesters chanted and sang.

“Come out, el-Sissi. The people want to topple the regime,” protesters in the Nile Delta city of Mahalla el-Kubra chanted, urging military chief Gen. Abdel-Fattah el-Sissi to intervene.

The military’s statement puts enormous pressure on Morsi and his Muslim Brotherhood. So far, the president has vowed he will remain in his position, but the opposition and crowds in the street — who numbered in the millions nationwide on Sunday — have made clear they will accept nothing less than his departure and a transition to early presidential elections.

That makes action by the generals when the deadline runs out nearly inevitable, since a deal seems unlikely. The statement did not define the “people’s demands” that must be met. But it strongly suggested that Sunday’s gigantic rallies expressed the desire of Egyptians, raising the likelihood it would insist on Morsi’s departure.

An army move against Morsi, however, risks a backlash from his Islamist supporters, who include hard-line former militants.

Morsi met Monday with el-Sissi and Prime Minister Hesham Kandil, according to the president’s Facebook page, without giving further details.

Already, the military’s presence in Cairo has increased at sensitive spots the past two days. Troops on Monday manned checkpoints on roads leading to a pro-Morsi rally of Islamists near his palace. They checked cars for weapons, after repeated reports some Islamists were arming themselves.

Morsi’s backers have been infuriated by what they call an opposition move to forcibly overthrow Egypt’s first president chosen in a democratic election. Some see the campaign as aimed at defeating the “Islamist project.”

In the evening, the pro-president rally outside the Rabia al-Adawiya Mosque not far from the Ittihadiya palace also swelled, though it was eclipsed by the opposition rallies. Its participants blew whistles and waved banners with Morsi’s picture on it.

“The military has sacrificed legitimacy. There will be a civil war,” Manal Shouib, a 47-year-old physiotherapist at the pro-president rally outside the Rabia al-Adawiya Mosque not far from Ittihadiya.

Mohammed Saeed, another Morsi supporter, vowed that he would fight the military if the president is ousted.

“If he (el-Sissi) wants to get rid of us, we will not run. We will face bullets with our bodies. Let the general commander of the armed forces respect his president.”

The sense of predicament among Morsi’s supporters was apparent as they concluded the sunset prayers with a supplication.

“May God answer the prayers of these extended hands to You. God, accept us as martyrs for Your cause and make Your slave Mohammed Morsi victorious,” said the imam who led the prayers. Muslims routinely refer to themselves as slaves of God.

In a sign of Morsi’s growing isolation, five Cabinet ministers said on Monday they have resigned their posts to join the protest movement, the state news agency said. The five are the ministers of communications, legal affairs, environment, tourism and water utilities, MENA reported.

The governor of the strategic province of Ismailia on the Suez Canal, Hassan el-Rifaai, also quit Monday, saying he made the decision in the interest of the nation.

Monday’s statement was the military’s second ultimatum. Earlier, el-Sissi gave the two sides a week to reach an agreement. That ultimatum expired on Sunday, with Morsi repeating his longstanding offer for dialogue, which the opposition rejected.

On Monday, the military praised the anti-Morsi protests as “glorious,” saying the participants expressed their opinion “in peaceful and civilized manner,” and that “it is necessary that the people get a reply … to their calls.”

The military underlined it will “not be a party in politics or rule.” But it said it has a responsibility to act because Egypt’s national security is facing a “grave danger,” according to the statement.

It said it repeats its call “for the people’s demands to be met,” giving all sides 48 hours “as a last chance to shoulder the burden of the historic moment.”

If the demands are not realized in that time, the military would be obliged to “announce a road-map for the future and the steps for overseeing its implementation, with participation of all patriotic and sincere parties and movements … excluding no one.”

The group that organized Sunday’s mass rallies, Tamarod, issued an ultimatum of its own earlier Monday, giving Morsi until the next day at 5 p.m. (1300 GMT) to step down or it would escalate its campaign with larger marches and “complete civil disobedience.”

It also urged the military and police to make clear their support for the protesters. When the military statement came out hours later, it made no changes in its own ultimatum.

The swiftness of the military’s new statement suggested it was prompted by the stunning turnout by the opposition on Sunday — and the eruptions of violence that point to how the confrontation could spiral into chaos if it continues.

Sunday’s protests were the largest seen in Egypt in the 2½ years of turmoil since the ouster of autocrat Hosni Mubarak in February 2011. Millions packed Cairo’s Tahrir Square, the streets outside the Ittihadiya presidential palace and main squares in cities around the country on the anniversary of Morsi’s inauguration.

The main rallies in Cairo were largely peaceful, but deadly violence broke out in several parts of the country, often when marchers came under gunfire, apparently from Islamists.

At least 16 people were killed and more than 780 injured, Health Ministry spokesman Yehya Moussa told state television.

In Cairo, protesters Sunday night attacked the Brotherhood’s main headquarters, pelting it with stones and firebombs. Brotherhood backers barricaded inside opened fire on them in clashes that went on for hours and left eight dead. In the early hours Monday, protesters breached the walls of the six-story luxury villa and stormed inside.

They carted off furniture, files, rugs, blankets, air conditioning units and portraits of Morsi, according to an Associated Press journalist at the scene. One protester emerged with a pistol and handed it over to a policeman outside.

The anti-Morsi demonstrators are calling for widespread labor strikes in an attempt to ratchet up the pressure on the president, but it was not immediately clear whether unions would respond to the call. Organizers are also calling for sit-ins at the Cabinet building, interim parliament, and another presidential place where Morsi has been working since late last week instead of Ittihadiya.

The military has for months been sending subtle but telling messages that it was not pleased with the policies pursued by Morsi and his Brotherhood.

Morsi was clearly scolding el-Sissi when he said in a televised address last Wednesday that the armed forces should focus on improving its capabilities.

The military seemed to reject that in its statement Monday, underlining that it “is a main player in the nation’s future” and has “a national and historic duty to protect the security and safety of the nation.”

Morsi has said he will not quit, saying that street action must not be allowed to remove an elected president or else the same could happen to future presidents.

For weeks, Morsi’s supporters have depicted the planned protest as a plot by Mubarak loyalists to return to power. But their claims were undermined by the extent of Sunday’s rallies. In Cairo and a string of cities in the Nile Delta and on the Mediterranean coast, the protests topped even the biggest protests of the 2011’s 18-day uprising, including the day Mubarak quit, Feb. 11, when giant crowds marched on Ittihadiya.

The mood was largely festive at Sunday’s giant anti-Morsi rallies in Tahrir and outside the Ittihadiya palace.

Fireworks went off overhead. Men and women, some with small children on their shoulders, beat drums, danced and sang, “By hook or by crook, we will bring Morsi down.” Residents in nearby homes showered water on marchers below — some carrying tents in preparation to camp outside the palace — to cool them in the summer heat, and blew whistles and waved flags in support.

“Mubarak took only 18 days although he had behind him the security, intelligence and a large sector of Egyptians,” said Amr Tawfeeq, an oil company employee marching toward Ittihadiya with a Christian friend. Morsi “won’t take long. We want him out and we are ready to pay the price.”

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Argentina facing likely debt default

English: Argentine President Cristina Fernande...

 

Argentina has vowed to continue its fight against Elliott Associates and other holdouts from its 2002 debt default, but Fitch Ratings doesn’t think it will win.

The ratings agency slashed the country’s sovereign debt rating yesterday, determining that “a default by Argentina is probable.” Argentina’s international law bonds are now rated CC. Fitch also cut its Argentine law bonds to B-minus.

Prior to the downgrade, both sets of bonds were rated B, four steps below investment grade.

Argentina is in danger of a technical default on exchange bonds it issued to creditors that accepted its debt restructuring—and a serious haircut in 2005 and 2010. A federal judge in New York has ordered the country to pay $1.33 billion into an escrow account for the holdouts, including Elliott affiliate NML Capital and Aurelius Capital Management, before it can make a $3 billion coupon payment on the exchange bonds. Argentina has vowed it will not pay the holdouts, which it calls vultures, but has also said that it will not default again.

Argentina’s eocnomy ministry said late on Monday it had filed an appeal and denounced Griesa’s ruling as “an attack on sovereignty that shows ignorance of the laws passed by our Congress.”

Any change to the terms of Argentine sovereign bonds must be approved by the country’s Congress.

The ministry said that if Griesa arranged a formula offering holdouts the same terms presented in the 2010 restructuring, Argentina’s Congress could debate it.

That proposal is unlikely to persuade the holdouts, however.

Earlier on Monday, investors holding $1 billion worth of restructured Argentine debt filed an emergency motion in a U.S. federal appeals court to fight the ruling, which they fear could prevent payment on their bonds and lead to a fresh default.

About 93 percent of bondholders agreed to swap defaulted debt from the 2002 default for new paper at a steep discount.

But holdouts, led by Elliott Management Corp’s NML Capital Ltd and Aurelius Capital Management, rejected the swaps and are fighting for full repayment in the courts.

Griesa’s order dismayed investors who took part in the two debt swaps and fear the G20 country will now enter into “technical default” on about $24 billion in restructured debt.

It was those holders who filed the motion on Monday in the U.S. 2nd Circuit Court of Appeals seeking to halt Griesa’s order.

The motion would ensure that interest payments to the bondholders continue while the appeal is decided,” said David Boies, a lawyer representing the investors. “Exchange bondholders agreed to take under 30 cents on the dollar to support Argentina’s debt restructuring.”

Argentina’s motion was filed to the same appeals court.

Aside from sparking howls from investors who participated in the debt restructurings, Griesa’s ruling was a setback for Argentina’s combative, left-leaning President Cristina Fernandez, who calls the holdout funds “vultures” and has vowed never to pay them.

Fernandez’s decision to vilify holdout creditors, who are loathed by most Argentines, makes payment a difficult prospect, and a local law prohibits offering a better deal than that given in the swaps. Doing so might expose Argentina to lawsuits from creditors who tendered their paper.

On the other hand, another default, albeit a technical default, would tarnish Fernandez’s record on managing the economy, deepen Argentina’s isolation from global financial markets and hit investment at a time of sluggish growth.

Some analysts fear the case’s implications could stretch far beyond Argentina and its creditors, hampering future debt restructurings and the operation of global payment systems.

The Argentine government is due to pay exchange bondholders at least $3.3 billion in principal and interest in December.

But if Griesa’s demand for payment of the $1.3 billion into an escrow account for holdouts is upheld by an appeals court and Argentina still refuses to pay, U.S. courts could embargo payments to the creditors who accepted the debt restructurings.

That would push Argentina into a technical default.

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