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Fears for reform as Egypt economy stalls

Apr 17 2011 14:28 Reuters

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Washington - A leading activist in Egypt's pro-democracy uprising warned the country's stalled economy posed a risk to its new political freedoms and he called for more help from the international community.

Wael Ghonim, a Google executive who emerged as a figurehead for the protests in Cairo in early 2011, said the protesters who toppled the country's president may give up on pushing for more freedoms if the economy remains in a slump.

"As an Egyptian I am really concerned that a counter-revolution could happen if people are not able to fulfill their basic needs," Ghonim, told Reuters.

Soaring prices and high unemployment helped trigger the mass movement that brought down President Hosni Mubarak after 30 years in charge of the most populous Arab nation.

Now Egypt's economy has come to a near standstill with growth expected to be just 1% this year, compared with expectations of 5% before the revolution, according to International Monetary Fund (IMF) figures.

"I want to make sure, as one of the young guys who participated in this revolution, that we do our best," Ghonim told Reuters late on Friday on the sidelines of an IMF meeting where he spoke on youth, jobs and growth in the Middle East.

"It's an obligation to help the economy to revive and everyone does its own share."

The popular uprising in Egypt slashed the country's vital tourism revenues for February by more than half and in 2011 as a whole they are set to fall by 25%.

Egypt relies on tourism as its top foreign currency earner, the source of over a tenth of the country's gross domestic product and the provider of one of every eight jobs.

The country's finance minister told Reuters on Thursday that Egypt needed $10bn in funding to help cope with the costs of the upheaval.

Money not the only answer

Ghonim said cash alone was not the answer: "Sometimes more money means more corruption, fewer solutions."

He said Egypt needed the know-how of institutions such as the IMF to help entrepreneurs foster small businesses and provide jobs.

He said private investment in tourism and manufacturing was also urgently needed to boost growth and quell frustrations among Egypt's poor with the changes in how the country is run.

Ghonim was detained and then released for his part in the uprising and his impassioned speeches during the protests helped galvanize the pro-democracy movement.

Egypt's military has run the country since the ousting of Mubarak and has amended the constitution to provide more freedoms. Parliamentary elections are due in September but some reformers worry they will not be ready in time.

At the IMF panel, sitting alongside the Fund's managing director, Ghonim said he felt out of place and that he shared the view of many of his countrymen "that the IMF was part of the problem as it made a lot of these regimes survive."

"Egypt had cancer and the international community was giving us Panadol," Ghonim said, urging foreign governments and lenders now to "press for the values they uphold and not for the interests they protect."

"The world has an obligation to make it successful because this sends the best message to dictators around the world. Look how peaceful it was for people to achieve their freedom. This should not go wrong."

"Why is it so easy to secure budgets to bomb nations while it is extremely hard to raise budgets to build a nation, when the end result supposedly is the same, which is freedom and democracy?".

 
imf  |  hosni mubarak  |  egypt
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