Egypt’s mixed messages
Egypt needs to embrace the new leadership, support it and give it a chance. Mohamed Morsi, in his turn, should set the tone for reconciliation and engage all Egyptians in the process of rebuilding the country
Taher Helmy , Wednesday 12 Sep 2012
Egypt has turned a page and must respect the results of the nation’s first democratic presidential elections by giving the new leadership a chance. Although many have understandable reservations, the fact is that the Muslim Brotherhood won.
Now that President Morsi has consolidated his powers (appointed a new cabinet, provincial governors and reshuffled the armed forces’ leadership), he holds full responsibility for what happens next. In his first speech he declared he was the president of all Egyptians, even those who did not vote for him. Now the president must prove his commitment to those words, especially in dealing with Egypt’s main concern – the economy. Otherwise he and his party risk losing their political gains and throwing the nation into turmoil with unprecedented economic deprivation.
Although some are opposed to it, accepting the IMF loan of USD 4.8 billion is a step in the right direction. This is not because of the amount, which is comparatively small and be absorbed within a few months, but because it sends a message to other lenders, donors and investors that Egypt is open for business and willing to abide by commitments and international business standards. The IMF loan basically acts as a certificate of good standing but it is not a cure for Egypt’s ailments, so much as a band aid. We need to depend first and foremost on ourselves.
I won’t repeat the dismal macro-economic indicators; suffice to say that Egypt’s economic crisis demands a clearly prioritised plan, fresh legislation, institutional restructuring and management re-hauls. Economic recovery will demand that the government take the initiative and communicate a clear vision to the people, public and private sectors alike.
To have investors back on board, we need to restore trust and confidence in the investment environment. That means more transparent policy and coordination between government agencies to facilitate doing business between all parties on a level playing field where no one has unfair advantages.
Although foreign direct investment is important, statistically and traditionally Egyptians are Egypt’s biggest investors. On his recent trip to China, accompanied by a group of Egyptian businessmen, President Morsi made it clear that this group, which included former members of the National Democratic Party, was on board for the recovery process. He went so far as to name a former NDP leader present at the gathering. “We need to move forward not back,” he said, indicating that business leaders of the past have a role in Egypt’s future, a positive, much needed message. He stressed that without the dedication, hard work and investment by the private sector, there will be no economic recovery.
At the same time, the issue of illegally expatriated funds must be lawfully addressed. Egypt needs to recover these funds, but the fastest way to do so is by establishing a legal framework to negotiate settlements, and I suggest adopting a reconciliation programme similar to that used in post-apartheid South Africa. This would involve drafting a new law that can oblige those justly accused to restore funds, properties and/or pay appropriate damages.
This legislation can cover funds we already know about in addition to those to be discovered in the future. The important thing is to settle these matters legally, efficiently and move on.
The South African system was complicated, but I envisage a simple framework for settlements and/or the voluntary return of the funds. This is the most viable way of repatriating the controversial funds at a time when Egypt needs all the foreign currency it can get.
The president’s appointment of Selim al-Awa, prominent lawyer and former presidential candidate, as his advisor on “transitional justice” looked like a positive step in this direction, although Dr Awa’s mandate was not clearly defined.
President Morsi also established a committee to restore illegally expatriated funds, but its relationship with Awa’s “transitional justice” remains unclear. What’s more, the aggressive rhetoric of some committee members, Freedom and Justice Party members and some other recently appointed officials about “going after everyone” does not sound promising. This committee is reporting directly to the President who should outline its mandate publically, while ensuring it works in close cooperation with Dr Awa.
Right now there is talk about suing England for withholding expatriated funds. As a lawyer I can say that this is a long and costly process. Above all, such mixed messages regarding the state’s intent create discomfort and divisions.
Much was accomplished in recent decades and not all of it bad, or mired in corruption. Millions of Egyptians worked for the Mubarak-led government over the years and did so in good faith. Over six million still work for state bureaucracies. Over seven million work in the private sector, which incidentally contributes 80 per cent of GDP, and none of these businesses was established or grew without government consent and in most instances, connections – that’s how the system worked. But that doesn’t make every civil servant or entrepreneur felool (“remnants of the fallen regime”).
This issue will have to be dealt with legally, to put an end to the uncertainty within the business community and the often unfair suspicions surrounding it. But just as South Africa’s reconciliation required the leadership of President Mandela, so Egypt needs President Morsi to take charge and deliver the message unequivocally, as he did in China, that Egypt is looking forwards, not backwards, and that we all have to work together to get there.
Some opposition members are saying he will fail, that he is unable to unite the country and fix the economy. They are understandably positioning themselves politically, but a well-informed opposition is a vital part of the democratic system of checks and balances, so long as it provides constructive criticism.
Failure is the last thing Egyptians want, since it affects us all and will hit the underprivileged the hardest. Egypt’s newly elected President needs to prove his opponents wrong by engaging the support of all Egyptians who believe in the democratic process, whether they voted for him or not. This is not the time for the voice of vengeance but for the President to set the tone for reconciliation.