Economic Crisis and the Politics of Reform in Egypt

Economic Crisis and the Politics of Reform in Egypt

Economic Crisis and the Politics of Reform in Egypt

Economic Crisis and the Politics of Reform in Egypt

Synopsis

Ray Bush teaches at the Institute for Politics and International Studies at the University of Leeds, where he is also the director of the Leeds University Center for African Studies.

Excerpt

This book examines the character and consequences of Egypt's economic reform and structural adjustment programme (ERSAP) of 1991, along with the second stage of reforms in 1996. Despite the very specific conditions pertaining to Egypt's political economy, its experience with the World Bank has relevance elsewhere in the Middle East and Africa. I will argue that, although economic and political reforms have been necessary, the strategy promoted by the international financial institutions (IFIs) and the government of Egypt (GoE) is inappropriate to the needs of Egypt. ERSAP does not address a significant number of issues, and there is continuing resistance within the GoE to reform. Among other things, the economic reforms focus too much on changes in the structure of prices and incentives and not enough on issues of productivity, growth, and the sustainability of markets, including the types of commodities for production, and the importance of political reform.

My focus is agriculture, where liberalisation began in the mid-1980s under Yusuf Wali, the Minister of Agriculture and Land Reclamation (MALR) and deputy prime minister. Agricultural reform has been preoccupied with market deregulation, cash crop promotion, and changes in land tenure. Reformers seldom mention the needs and interests of Egypt's much-maligned fellahin and especially the vast majority of small landholders, with access to 5 feddans or less. These farmers represent about 96 percent of the country's landholders and agricultural producers, and the policies pursued by the IFIs are undermining their productive capabilities.

I offer a direct critique of most orthodox commentary on Egypt's political economy. Most of the historical and contemporary characterisations of Egypt's economic malaise are based on fundamental misunderstandings of the social organisation and economic dynamics of rural Egypt. Most accounts of Egypt's economic reform, moreover, use a crude conception of the market as an instrument of economic progress. I now argue . . .

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