Tough economic decisions await Egypt – Gamal Mubarak

* New reforms to increase govt investment budget

* Reforms to boost Egypt’s GDP to 7-8 pct over next 5 yrs

* Reforms come ahead of presidential elections in September

By Marwa Awad

CAIRO, Dec 28 (BestGrowthStock) – Egypt will seek to raise its
annual investments to 100 billion Egyptian pounds ($17.22
billion) in the next five years, up from 30 billion pounds, to
lift its growth rates to 7 and 8 percent, the ruling party’s
policy chief and the president’s son said on Monday.

Gamal Mubarak, 47, said the government must make tough
economic decisions to spur economic growth, hit by the global
downturn by offering infrastructure projects in 2011 that
involve a partnership of the private and public sectors.

The businessman-turned-politician spearheaded reforms that
boosted the annual growth rate to 7 percent in the three years
prior to the 2008 economic crisis. The government expects
Egypt’s GDP to reach about 6 percent in the fiscal year ending
in June 2011.

“We need to quickly return to average growth rates of 7 to 8
percent (and) we need bolder policies to do this,” Gamal told
reporters at a presser after the National Democratic Party’s
(NDP) annual conference.

“To do this, we need to push average public investments to
100 billion per year. It has been about 30 billion in the past
five years,” he added.

The government will offer projects in partnership between
private and public sectors in infrastructure such as roads,
water and sewage, he said.

Many Egyptians are deeply suspicious of any economic
reforms, which they say are designed to benefit a select elite
at the expense of the poor who struggle with rising prices and
low salaries.
The new reforms come ahead of presidential elections where
President Hosni Mubarak is expected to seek re-election. The
government is often sensitive to timings of austerity measures
that could trigger public protests.

Asked about possible public unrest the new reforms could
trigger, Gamal said Egypt was like other European countries has
its share of protests but stressed the NDP would work to lobby a
critical mass of supporters for the party’s new policies.
“The government will continue to set price rates and offer
these services. It buys the service from the investor and then
offers it to society at a fair cost,” said Gamal, adding the
party would press on with new pension and social insurance laws.

Defending the country’s liberalisation policies abroad,
Gamal said Egypt was investing in infrastructure projects in the
region, dismissing talk of the country’s receding regional role
as “neither fair nor rational”.

“I don’t believe … Egypt’s role is retrenching. Egypt’s
role is changing. If we had stuck to the same policies of the
past 40 years in such a totally different world scene, then we
would have really retrenched.”
(Writing by Marwa Awad)

Tough economic decisions await Egypt – Gamal Mubarak