Via EgyptMonocle, by Amr Ramadan. Only an excerpt--read on.
The tourism sector has stalled over the past year and a half. (Photo by Dalia Rabie)
Cairo: Egypt’s presidential candidates are polarizing on many levels, but they do have one thing in common: both face a dire economic situation that needs quick fixing as well as a long-term vision to solve countless longstanding socioeconomic ailments.
In the June 16-17 runoff, voters face the unenviable choice between ousted president Hosni Mubarak’s last prime minister, Ahmed Shafik, and the candidate of the Muslim Brotherhood’s Freedom and Justice Party (FJP), Mohamed Morsi.
Over the past year and a half, economic issues have taken a back seat to political instability, lacking security and ideological power struggles that have escalated to debilitating proportions.
Meanwhile, an economic slowdown continues with the financial sector under increasing pressure, the tourism sector still stalling, unemployment on the rise and scarce foreign reserves threatening energy supplies. Not to mention foreign investors staying at bay and playing wait-and-see.
The hope for a swift economic revolution has more or less faded, and the elected president will be left picking up the pieces. Each candidate brings to the table an economic program they see fit to fix the economy and spur investment, which Egypt heavily relies on to create jobs and battle chronic unemployment.
But with polarizing politics come divergent economic views.
On the one hand, Shafik is a former military man seen as a stalwart of the old regime by his opposition and the herald of stability and security by his supporters. He promises an effective police force and security apparatus, improved law enforcement and a heavy-handed state to achieve macroeconomic stability and economic development.
His opponent Morsi, currently head of the FJP, is viewed with mistrust by some: the front-man of a party that has failed to make an impact in parliament — where it enjoys a majority — and failed to deliver on the demands of the revolution.
Morsi’s supporters, however, hail him as a well-educated, revolutionary leader that can adopt moderate political Islam to the complexities of political rule. He preaches moderate Islam and a morally-guided government that would work together with civil society and the private sector to stamp out corruption and the remnants of the old regime.
All in the details
A perusal of the candidates’ presidential platforms reveals some similarities, with the main differences reflected in the details.
Morsi’s economic vision, the same as the Muslim Brotherhood’s, is more comprehensive and detailed, which may be due to the fact that nearly half of his 80-page platform concerns the economy. Meanwhile, Shafik’s economic plan comprises 16 points, while the rest of his platform prioritizes security and law enforcement.
Shafik lists the economic goals he intends to achieve as president, but Morsi adds to this by giving detailed explanations and benchmarks using clear indicators of progress. For example, Morsi measures the success of fighting corruption by its effect on economic indicators, job creation and public trust in government. He also details a number of short- and long-term goals and steps for reforming monetary, fiscal, trade and industry-related policies.
Both intend to reduce the budget deficit by the end of the four-year term to an acceptable average of around 6 percent of GDP. Morsi promises more. He claims that under the Nahda (Renaissance) Project, Egypt can achieve an average annual growth rate of 7 percent in the next 10 years and double the rate of GDP per capita.
While Shafik’s platform lacks long-term vision, Morsi’s has an ambitious economic plan with benchmarks for the year 2023.
Both plan to initiate national mega-projects as well as industrial and technological zones across Egypt, particularly in neglected areas like the rural south and Delta. Shafik provides the location, name and the purpose of the proposed projects; while Morsi delves further into funding and implementation strategies, making his ideas seem better thought out.
But the long-term outlook detailed in the Nahda Project may not be completely to Morsi’s advantage. Coupled with the FJP’s power dominance — parliament, the constituent assembly and now perhaps even the presidency — it’s an indication of how long they plan to be in power: a long time. This plays into the fears of a skeptical public, wary of recreating a single-party stronghold on politics as memories and remnants of Mubarak’s National Democratic Party still plague the nation.
In this light, Shafik’s clear-cut, short-term goals of returning political and economic stability may be more appealing.
Similarities between the candidates’ platforms are striking and, not surprisingly, both claim to prioritize fighting corruption, empowering the private sector, promoting stronger trade and investment ties with African and Arab countries, targeting fuel and bread subsidies to better support the poor, and endorsing various unemployment and social safety nets.
Although Morsi does call for a more flexible taxation system that achieves social justice, both avoid a detailed discussion in terms of percentages, tax brackets, increases and decreases. Both aim to lower taxes for small and medium enterprises.
One of the main differences in their dealing with economic issues is the role of civil society, citizens and the media in terms of responsibility and monitoring. Both say they want to empower civil society, but Morsi adopts a more participatory approach in terms of the contribution of civil society, media and citizens to economic development.
On the flip side, Shafik defines a clear role for the armed forces in the economy, describing it as “a strategic necessity since they pay taxes.”
Egypt’s informal sector, a significant and neglected part of the economy which the International Labor Organization estimates to be half of the non-agricultural workforce in Egypt, is not mentioned by Shafik. Morsi, however, outlines a detailed plan to integrate the informal sector into the economy.
via egyptmonocle.com
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