The U.S. has offered support for embattled President Mohamed Morsy, provided Egypt falls in line and follows the tough economic prescriptions of the International Monetary Fund (IMF).

Visiting U.S. Secretary of State John Kerry made it plain during his visit to Cairo that Egypt would have to agree to painful IMF conditions if it is to avail itself a life-saving $4.8 billion loan.

“It is paramount, essential, urgent that the Egyptian economy get stronger, that it gets back on its feet,” said Mr. Kerry during a meeting with Egyptian and U.S. business executives. “It’s clear to us that the IMF arrangement needs to be reached.”

With little room for manoeuvre, Mr. Morsy has found himself in a tight corner. In case he accepts the harsh loan conditions — slashing of energy subsidies and a steep hike in taxes — the President risks deepening social unrest among his people, who are looking for economic relief, two years after a turbulent revolution. Conversely, if he doesn’t accept the debt, he risks collapse of the economy. Analysts point out that once the IMF loan is through, Egypt could raise bilateral loans from U.S. and Europe, but this could, conversely, lure Egypt into a debt trap.

By way of political incentive, Mr. Kerry backed Mr. Morsy’s controversial call for fresh parliamentary elections, slated to begin on April 22.

Retrial of Mubarak

A decision taken on Sunday by an Egyptian appeals court for the retrial for former President Hosni Mubarak on April 13 — nine days ahead of the polls — is likely to impact the elections. Mr. Mubarak faces charges of corruption and conspiracy to kill protesters during the 2011 uprising that led to his fall.

The retrial has been ordered after a court had earlier accepted Mr. Mubarak’s appeal against the life sentence that he is serving following his conviction last June.

Others who will face re-trial include former interior minister Habib al-Adly, who was sentenced for life for his role in the killing of dissidents. The former President’s sons, Alaa and Gamal, who were acquitted in June, will now be retried on corruption charges.

The U.S. support for the polls was a wrap on knuckles of the National Salvation Front — the opposition conglomerate that has decided to boycott the parliamentary poll. Mr. Kerry held separate talks with opposition leaders, which included a meeting with former presidential hopeful Amr Moussa, to reinforce his message of support for the polls.

He also had a telephonic conversation with Mohamed ElBaradei, another political heavyweight, who has become Mr. Morsy’s visceral critic. Hamdeen Sabbahi, who stood third in the presidential race, chose not to attend the group meeting with Mr. Kerry.

There were small but colourful street protests against Mr. Kerry, perceived by some of having a soft-corner for the Islamist president, and the Muslim Brotherhood, Mr. Morsy’s parent organisation. Mr. Kerry’s pictures were set alight by a group of anti-Morsy demonstrators who had assembled on Saturday outside the Foreign Ministry building, where the top American diplomat was to meet Kamel Amr, the Egyptian Foreign Minister.

Reuters reported that the demonstrators had earlier marched from Tahrir Square, holding up cartoons of Mr. Kerry sporting an Islamic beard. Placards bearing Mr. Morsy’s pictures showed him sporting a similar moustache to that of Adolf Hitler.

As Mr. Kerry held talks in Cairo, there was seething turmoil in some Egyptian cities. Protests broke out in the Nile Delta city of Mansoura, after an armoured police vehicle ran over and killed a demonstrator. There was violence in the Suez Canal city of Port Said, where protesters burned down a police station, state media reported.

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