| The Socialist on reestablishing the state’s economic power |
| By Hania Moheeb and Passant Rabie |
| Q You have a long history in politics. What do you think of the current state of the political scene in Egypt? A I was just saying today that the current situation in Egypt is worse than the naksa [setback] of ‘67. In 1967, we suffered a sudden defeat, and the entire Egyptian [population] took to the streets and decided to fight it out. But today, the morale is much worse than 1967.We’re suffering from the ongoing cooperation between former members of the National Democratic Party, the Supreme Council of Armed Forces (SCAF) and the Salafi party. This triangle is aligning itself with another external force in the shape of world leaders who fear the freedom of the Arab world, as the Arab Spring threatens their power position. This external triangle of America, Israel and the Gulf is in cooperation with the internal triangle of NDP, SCAF and Salafis. They are on one side, and the Egyptian people are on the other side. And all of a sudden, the majority of the People’s Assembly was overtaken, and the Shura Council formed without people voting. At the same time, people believe that the revolution is the cause of all of the problems going on in Egypt right now. The revolution didn’t tell SCAF, the Muslim Brotherhood and the Salafis to conspire against it. They’re the ones who decided to turn against the revolution and not fulfill its demands. I believe that it will take time, and may result in a social battle between those with power and money and those who are deprived of power and money. Q How is this going to affect voting in the presidential elections? A There is no real voting, because of article 28. We can’t depend on real voting. Who can tell me that Omar Suleiman is running because he’s been requested by the people, or that Ahmed Shafik and Amr Moussa are running when they should have been behind bars with Mubarak. [At the time this interview was conducted Omar Suleiman was still in the running. He has since been disqualified]. Who’s to say that the Salafis are running now in the elections when they used to say that the revolution is a sin because it’s rebelling against the ruler. The current situation is dire, and resolving it won’t be easy. That’s why we’re saying that the current period needs people to realize there is a real threat that affects everyone more than any economic or social interests. Q What are the most important reforms that you would like to focus on? A For the short term, you have to impose security. Second comes truly activating the democratic mechanism, reforming the presidential electoral law, local supervision of local performance in different governorates, reform the media so that they don’t incite hate or violence and that they play a role in ensuring national unity. We also have issues with integrating people with physical and mental handicaps, and they represent around 11% of the population, as well as the integration of minorities whether they be racial, religious, in Sinai, the Western Desert, Al-Arish. We also have the issue of pensions, with over 8.5 million people who don’t receive enough from their pensions. We have a problem with women in Egypt that in every 100 families, 28 of them are financially supported by the woman, and she’s usually not in good [health] condition to support a whole family. We also have the issue of slums; the people who live in the graveyards, street children who are roaming the streets and form generations upon generations in the street. All of these are issues that we need to address, besides education, scientific research, trade, industry and agriculture. Q What are your plans for reforming education in both the short and long term? A We need to rebuild the educational institutions in Egypt since they are not fit for education. We need to expand the schools and develop curricula so that they are not all dependent on memorization but rather on research and understanding. I want to say that I’m not the one who’s going to do all of that, because I won’t be the manager of everything. There are going to be people with me. So we need the experiences of people who already exist, but it’s how you benefit from this experience and utilize it. Q What are you planning to do about the issue of healthcare? A Our main goal is to ensure health insurance for all citizens. To make it easier to apply and not cost a lot, we want all hospitals and medical institutes to have the same facilities under a local administration. I also would like for medicine and other medical resources to be manufactured in Egypt for the Egyptian market to regain its place once again. There’s also an issue with health in Egypt that […] people living in slums and other rundown areas don’t receive proper medical care We want to make it available for everyone. Q Do you have any policies directed toward protecting religious minorities in Egypt? A We have to admit that there is a problem with religious freedom in general. I believe that there is also sectarian tension between Muslims, in that some follow the Prophet’s teachings or Sunna, or Sufism. So there is tension between Muslims, then there’s tension between Muslims and Christians, and then there’s tension between the different sects of Christians. Therefore, there should be a common concept of equal rights and respect. We must admit to these problems and work toward national unity. Q One of your plans is to cancel the Camp David treaty. How would that affect Egypt’s affairs with other countries, namely the United States and Israel? A It won’t have an effect on our foreign affairs, because the current treaty has put Egypt into a state of surrender. The idea is to attempt to reform that treaty, over a period of seven to eight years in order to regain [sovereignty] over all of Sinai, thereby weakening Israel and developing a democratic, secular Palestinian state where Palestinian citizens can return to live in their homeland. Q What is Egypt’s identity and where do you want to take it if you are elected? Do you have any plans to rebuild relationships with African and Arab countries? A Culturally, Egypt has a mixed identity of three components: ancient Egyptian, African and Arab. If Egypt is the gift of the Nile, then the Nile stems from the African continent: the Nile Basin countries and Ethiopia. It is no surprise that almost half of the Ethiopian population is Muslim and almost one third are Orthodox Christians following the Egyptian Coptic church. Hence vital relations between the Nile Basin countries and Egypt are a necessity of life. That’s why I want to assert the African identity, the identity of the Nile Basin, for without it and without the Nile we won’t survive. Today, Egypt has a leading role in the Arab and Islamic worlds and in Africa as well as Asia. I will go as far as saying that one can sense an Egyptian influence in Latin America, Europe and even in the US. I’m referring here to the political influence that followed the 1952 Revolution. I think that Egypt has to regain its leading role, especially given that Egyptian nationals living abroad exceed eight million people and are among the most educated and civilized foreign communities in the world. This is what we call soft power. There are two other institutions that manifest this soft power. The first is Al-Azhar, which represents the moderate Islamic school. Its leading role and influence have declined over the past years, especially in the eras of Sadat and Mubarak, which led to the emergence of the so-called Islamic groups. Second is the Coptic Orthodox Church which has great influence in Africa. I hope all Egyptians can recognize the enormous influence of the Egyptian Church worldwide so those two religious institutions can play a substantial international role if we empower them. Q Do you believe that leftist ideology can be applied in Egypt? A Leftist ideology is built on a triangle, the base of which is democratic abilities built on knowledge. This democratic side leads to development aimed toward those living in lower or middle classes. There is also a third side to the triangle which is justice and equality. These three elements are what would benefit the world right now. There is a common trend around the world, in places like the US and France, leaning towards leftist ideologies under the banner that we are the 99 percent and you are the 1% which has the majority of wealth. The world is now heading left. Q But history has shown leftist or socialist ideologies applied unsuccessfully in the past, correct? A It has only failed in the application process, but the premise itself does not fail. The premise — which should be based on science — has never failed. The application failed because there were certain circumstances that affected its experiment. The Soviet Union began and then entered World War II with 23 million soldiers and managed to destroy 74% of anything that was related to Nazism or Fascism. No one could say that the experiment failed, and at one point the Soviet Union was the second most powerful force in the world. Who can say that was a failure? Q You had said that you would withdraw from the presidential race if someone else from the leftist thought came along. How do you feel now? A If I had thought that another candidate better represented leftism, then I would have withdrawn. I had called for liberal forces to unite and agree on one candidate that we could all get behind, but this was never applied in reality. Not every one who walked along the leftist path is a leftist. Ultimately, the next few days could see people rallying around one person. Q Maybe the most pressing economic problem we are facing today is the budget deficit. How are you planning on tackling this issue? A The deficit is always caused by regression of the overall economic performance, the prevalence of financial and managerial corruption and the presence of a greedy, monopolistic, corruptive class that transfers the country’s wealth abroad. The public sector has been decimated in favor of an economic system that has no identity; it was neither socialist nor capitalist nor liberal — it was nothing. The fast solution for the budget deficit is to set the production wheel back in motion: to restart numerous factories that were suspended before the revolution and for which we have both the financial and the managerial capacities to run. We also have LE 1 billion in overdue taxes, and I really don’t see why the government should facilitate the terms of payment for those taxpayers. This year, mega conglomerates like Ezz Steel and others got energy subsidies worth LE 50 billion in addition to LE 15 billion in subsidized materials. They don’t pay proportionate taxes as we don’t apply progressive taxation. One-quarter of the general tax is financed by the wealthy whether from the private or the public sectors, and three-quarters is financed by the poor and the needy through indirect taxation. Over and above, the indirect taxes provide LE 100 billion to finance the private funds that are used one way or another to deal with the budget deficit. There is one decision I will make as soon as I become president, and it’s legal, right and halal: The goods and products on the market, local or imported, should be sold at a price proportionate to their production cost with a moderate profit margin of 5-6%. This decision will lower prices by 50%, which means that the purchasing power of Egyptians will double. Q We’ve lost a lot of direct foreign investments over the last year. How can we regain the confidence of foreign investors? A If you mean the capital invested in the stock market, this is opportunist capital as the stock market in Egypt doesn’t trade in industrial bonds. It’s more like a lottery, and those who “invest” in it transfer their money out of the country without paying a fee of even 1% of the so-called profits they make. Dr. Gouda Abdel-Khalek [minister of supply and domestic trade] suggested a fee and was harshly criticized. As for the real investments, I believe that those did not leave Egypt over the past year after the revolution. If we look at the balance of payments, we’ll realize that it exceeds that of the year before by LE 18 billion; this year’s taxes are 66% higher than the year before. Things are progressing but media is focusing only on the drawbacks — the unemployment and so on. Foreign investments will come when we have transparency, the rule of law, when the procedures are simple and when we study the priorities of industry and the limits of competition. We have to be aware of the practices that lead to economic occupation: The assembling industries were just a way for foreign companies to avoid taxation and custom duties. We have banks that work on transferring Egyptian capital abroad. We know that some businessmen have $225 billion (LE 1.4 trillion) in banks and investments abroad. Such capital could have been invested domestically. All aspects need to be reconsidered, but whoever takes office won’t have a magic wand to change everything. He will have to start working on development and boosting hope, providing work opportunities and reviving the cooperative system that can unite craftsmen and small businessmen, every 10 or 15 in one company, give them incentives and subsidies like credit without interest, short-term exemption from taxes and custom duties, and then they can improve their life. If we focus on this instead of looking for bigger investors who would probably transfer capital abroad, we can also develop agriculture and urge farmers to work together by giving incentives to their cooperatives in the form of subsidized fertilizers and seeds at cost and with no interest; the government should pay the interest so that the subsidy becomes direct and doesn’t get wasted. The potential for investments is enormous in the coming period but will need someone who has ambition and hopes to upgrade the lives of the people. We should rely on institutions, rather than individuals, that employ the creative young people. I think we should have a ministry for application of research to help young inventors, a ministry for women and another for the poor. Q Would you say that you are against foreign investments then? A On the contrary, foreign investors are welcome but on our terms and conditions. We don’t want them to compete with our products, pushing our factories out of business. And we won’t give them special incentives; they will be treated just like local investors. But the priority now is our national industries;.All Egyptian enterprises whether public or private are about to collapse because they can’t compete internationally. Hence, it’s not logical to think of foreign investments before saving our national industries first to cater to the local market and to compete in international markets. The General Agreement on Tariffs and Trade obligates us to open our markets to Korean, Indian, Chinese products and so on, but if we don’t encourage Egyptians to buy Egyptian products then we’ll be lost. Q A number of court rulings over the last few years annulled contracts privatizing a number of public companies and factories. If this trend goes on, do you think foreign investors are going to be discouraged? A You mentioned court verdicts which means the law, and since it is the law we must recognize them as just. They were issued by courts that apply the law, not haphazard decisions taken by me or by anyone else. The court verdicts have revealed that the deals were corrupt, […] and proven corrupt in Egypt they should be considered corrupt internationally. I’ll give you an example; when [former Prime Minister Margaret] Thatcher launched privatization in the United Kingdom, she called it ‘democratization of economy,’ which means broadening the ownership base. The state gave very low-value stocks to the people which enabled them to monitor the management and the process moved along smoothly. This proves that popular or government supervision does not discourage investors. Q Do you intend to proceed with the privatization program? A I’m not against the private sector. I’ll resort to a mixed system; public, cooperative and private. There has to be a public sector since we don’t have an old, stable and institutional private sector that has working laws and rules like in Western Europe, for instance. Over and above, Egyptian capitalists who are not used to halal profit can’t build the economy like Talaat Harb did, for instance, so we are obliged to build our economy with public capital. It is common worldwide that the state-owned economy may represent in some countries 30–40% of enterprises. Q But will you proceed with selling public companies? A Of course not, or else we will be privatizing the state administrative body, the army and the Suez Canal. There is a global class of professional managers; when Thatcher had a conflict with the coal workers she insisted on employing an American manager to run the British mines. She stood up to the workers and the plan worked out. What makes private management work is monitoring, whether popular, parliamentary or by the local authorities. The more we apply democracy, the more we engage public opinion in decision-making. So privatization is not totally refused but it has to follow transparent rules, and I believe we have to apply the principles of good governance to all institutions regardless of the kind of ownership. I will work on embracing in the Egyptian Constitution the principle of honoring all international agreements that Egypt has signed, so that they become as binding as the Constitution. This step would also make us more credible internationally. Q How do you intend to respond to workers’ demands? A Workers don’t have abnormal demands; they used to strike before and after the revolution to operate the factories and to get their modest wages. They need the government to recognize their right to fixed-term contracts, to feel secure about their present and future, receive realistic wages with increases over time. We should apply the minimum wage and actually, I believe that wages should double because they haven’t changed from 1981 to 2005. We want to involve the workers in managing the public-, cooperative- and private-sectors enterprises. They should get a reasonable percentage of the profits; instead of 10% maybe 15% or 20%; employers would get a reasonable share of the profit and the workers would get social services financed by their share of the profit. In the public sector, we used to get 25% of the profits: 10% in cash and the rest in services, health care, housing and so on. Such services give workers a sense of stability when the enterprise provides them with housing close to their factories, with appropriate health care, cultural and sports activities and so on. We want to revive this system because we want a productive and cooperating society rather than a class hungry for quick profits. Q Unemployment has reached 12% in Egypt. How will you handle this problem given the modest qualifications of human resources? A I believe we have plentiful human resources, from simple workers to experts and scientists. Egyptians abroad are ready to contribute to the development process whether by financing, investing or managing, and I guess they can be considered an endless resource. To solve the problem of unemployment I need to create a new and parallel Egypt; a comprehensive urban community with economic activities, agriculture, industry, airports, hospitals, universities, roads, highways, infrastructure. Because in 35 years, the population will double and since the Nile Valley is already overpopulated it can’t house more people. With development projects and the increase in production we can apply a progressive tax system and find the necessary resources to finance this new urban community whose construction will need labor. As the project progresses, endless work opportunities will be created. |
Be Social
Comments
Leave a Comment