CAIRO: The People’s Assembly’s agriculture and irrigation committee has reached an agreement with the government over criminal action concerning the repayment of loans given to Egyptian farmers through the Bank for Development and Agricultural Credit, the committee head told Daily News Egypt.
“We have solved the problem, MP and head of the committee Abdel-Rehim El-Ghul told Daily News Egypt, “the government has agreed to wait on those who are unable to repay.
The agreement comes a day after the committee attacked the government over its stance on debt collection and accused it of being the main reason for the numerous defaulted payments.
The committee had criticized a governmental decision to renege on a previous agreement to consider criminal action against the defaulters, despite various ministries agreeing not to pursue the debtors through legal means.
According to figures in the local press, there are currently 85,000 farmers who have defaulted on loans given by the Agricultural Credit Bank, with the total debt running at LE 2 billion.
Left-leaning MP Hamdein El Sabahy was quoted in one newspaper as saying, “Beware of a peasants revolution which would explode at any time because the government did not commit to its previous decisions.
El-Ghul was also quoted as saying, “How can we prosecute 80 percent of the farmers when their debts are equivalent to those of only 10 businessmen who have robbed our banks and fled abroad?
The chairman of the Agricultural Credit Bank Ali Shaker admitted in an article that ran in Al-Masry Al-Youm newspaper that some of the bank employees had scammed farmers in the loan process and that the bank’s archaic credit policy was one of the reasons many of the creditors defaulted on their payments.
He added that the new bank management was looking into ways to overhaul the credit policy and bring it line with more modern standards.