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Egypt's PM says US threats to cut aid won't work

By Sarah El Deeb

Associated Press

Published: Wednesday, Feb. 8 2012 12:51 p.m. MST

Egyptian investigative judges Sameh Abu Zeid, right, and Ashraf el-Ashmawi, who are investigating the case of foreign funding of NGOs, enter a press conference at the Ministry of Justice in Cairo, Egypt, Wednesday, Feb. 8, 2012. 43 people including 19 Americans face trials over illegally operating in Egypt and receiving funds from abroad without permission from Egyptian authorities for their human rights and pro-democracy groups. Egypt charges that they fund and support anti-government protests. The groups deny that.

Amr Nabil, Associated Press

CAIRO — Egypt refused to back down Wednesday in a dispute with the U.S. over Cairo's crackdown on nonprofit groups despite Washington's threats to cut aid, while the military deployed troops to the nation's streets after a surge in violence and protests against its rule.

Egypt's official MENA news agency said the army was deploying more troops to reinforce the police, restore security and state "prestige." The move comes in the wake of a deadly soccer riot last week that sparked days of clashes between the police and protesters. At least 89 people were killed in a week of violence.

The deployment appeared to be a show of force by the military in response to a surge in criticism of its handling of the country's transition to democracy and rising calls for the ruling generals to step down. There are calls for a general strike on Feb. 11 that have been gaining traction.

Egypt's military rulers are also facing a deepening dispute with the United States over Cairo's campaign against foreign-funded pro-democracy and rights groups, which began late last year with raid by security forces on the organizations' offices. Authorities allege there is a foreign conspiracy against Egypt to explain the widening protests against the military's performance.

On Sunday, Egyptian investigative judges referred 16 Americans and 27 others to trial on accusations they illegally used foreign funds to foment unrest in the country.

That immediately drew a sharp rebuke from Washington, with Secretary of State Hillary Rodham Clinton warning that failure to resolve the dispute may lead to the loss of some $1.5 billion in aid to Egypt. Some U.S. legislators even said every aspect of the relationship with Egypt must be examined following the crackdown.

State Department spokeswoman Victoria Nuland called on Egypt to release the Americans, saying the 16 "have not done anything wrong." Egyptian authorities put the number of Americans referred to trial at 19, but Nuland on Tuesday said there are 16 Americans in the case.

Nuland said the U.S. received a 175-page document in Arabic outlining the charges, but "our view remains that this is not fundamentally a judicial issue," but an issue between governments over the proper role of the groups.

With tensions rising, the Chairman of the Joint Chiefs of Staff, Gen. Martin Dempsey, is to travel to Egypt this week for talks with military ruler Field Marshal Hussein Tantawi. Dempsey's spokesman, Col. Dave Lapan, said Wednesday the trip has long been planned, but that the nonprofit spat will come up if it hasn't been resolved. He said Dempsey would talk with Egypt's leaders about "choices and consequences," but declined to elaborate.

Despite the warnings from Washington, Egypt's military-backed Prime Minister Kamal el-Ganzouri struck a defiant tone Wednesday, telling reporters he was "saddened" by the pressure Egypt was facing but insisting authorities "can't back down or won't change course because of some aid."

"Egypt used its legal right to face some violations by civil groups," he said. "The lofty judiciary moved and discussed and investigated the case. ... The West then turned against us because Egypt exercised its rights."

El-Ganzouri also charged that aid pledged by Arab states has also stalled since the dispute began. He said he met in early December with Arab ambassadors "who promised that Egypt will receive a lot of money," but two months later "none of these promises have come through."

He hinted that the U.S. and Arab allies are withholding aid money because Egypt has adopted more independent policies since the uprising that ousted President Hosni Mubarak in February.

Egypt's net international reserves were down 50 percent year-on-year by the end of December as the country's economy is reeling from the overall effect of the uprising and the turmoil that followed. The government is discussing with the International Monetary Fund a $3.2 billion loan.

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