Tag Archives: egypt

Confronting Egypt’s Implementation Gap

Anna Nadgrodkiewicz and Marko Tomicic present the Implementation Gap handbook.

Anna Nadgrodkiewicz and Marko Tomicic present the Implementation Gap handbook.

This past week, CIPE’s Cairo field office worked with partners Federation of Economic Development Associations (FEDA) and United Group to facilitate a conference on “Combating Corruption between the State and the Society.” The event was intended to summarize the lessons learned and experience gained by CIPE and its partners since 2008 under CIPE Egypt’s U.S. Agency for International Development- funded Combating Corruption and Promoting Transparency program, and to lay the groundwork for the newly-funded, two-year next phase of the initiative.

Of particular interest to the approximately 120 Egyptians present were two panelists who telecasted in from our Washington, DC office to share their perceptions of the “implementation gap” in Egyptian governance.

Marko Tomicic, a manager at the innovative transparency, governance, and corruption research organization Global Integrity, encouraged the audience to shy away from the conventional reliance on ranking indexes to understand the relative successes and failures of a country, and in particular, their own country.

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What Will Happen to Egyptian Civil Society if the New NGO Law is Implemented?

Civil society organizations have been instrumental in the evolution of Egypt's revolution since 2011.

Civil society organizations have been instrumental in the evolution of Egypt’s revolution since 2011. (Photo: Wikimedia Commons)

By Sally Roshdy, a CIPE-Atlas Corps Think Tank LINKS  Fellow serving at the Project on Middle East Democracy (POMED)

Revolutions do not erupt out of the blue – they are the result of citizens’ accumulated disappointments and their disapproval with the status quo over time. In January 2010, this is precisely what happened in Egypt. Our revolution took place because many people – especially those in the civil society – wanted to do something about their political and economic frustrations.

The Egyptian civil society sector is an important part of Egypt’s recent history. Prior to the revolution, they helped build awareness about the need for democratic governance. They also helped spread awareness about various human rights abuses taking place in Egypt. After the revolution, activists and organizations were instrumental in documenting what was happening on the ground, forming fact-finding committees, and seeking the release of the detained young people who participated in demonstrations. Civil society, therefore, played – and is playing – a crucial part during the democratic transition of the country, and is helping bring people to demand their fundamental right to a life of dignity, freedom, and social justice.

Freedom of association is an essential component of democracy. The more a country allows citizens to engage at the civil society level, the more democratic it is going to be. This, however, has not been realized in Egypt even after the country welcomed its first democratically-elected president. In fact, it seems to be reversing given the latest NGO draft law presented by the Ministry of Insurance and Social Affairs.

This draft has shocked those who were hoping the new government will introduce a new law that will support civil society activities in post-revolution Egypt. Instead of being supportive, the proposed draft law could potentially minimize what activities civil society organizations can engage in. Some activists are calling this draft even worse than the current governing laws for civil society organizations in Egypt. Following are some concerns regarding the proposed NGO law:

  • The bill stipulates the formation of a coordination committee that would oversee all activities done by international NGOs. This committee is supposed to include representatives from Interior Ministry and one from the National Security Agency, which foreshadows a desire of the government to involve security agencies in civil society work. Moreover, the draft gives the administrative representatives the right to arrest anyone for breaking the draft law.
  • The bill will increase the minimum capital needed to establish nonprofits from LE 10,000 (about $1,500 US) to LE 250,000 (more than $37,000 US). This has the potential to deprive the right for young people and less financially-sound qualified individuals from organizing themselves.
  • All associations, foundations, and federations subjected to this proposed law will be under the oversight of an Egyptian Central auditing organization, implying that civil society organizations will be part of a semi-government entity.

Civil society in Egypt may soon be forced to work in such a challenging legal framework. And this is alarming. Limiting freedom of association is a step backwards for Egypt’s democratic transition.

CIPE Atlas Corps Think Tank LINKS Fellowship brings talented young professionals with strong research backgrounds to shadow researchers and experts at leading U.S. think tanks for six month. Sally Roshdy is part of the inaugural class, serving at the Project on Middle East Democracy (POMED).

Peru’s Lesson for the Middle East and North Africa

Hernando de Soto

One of the first people to walk through the doors after CIPE’s founding in 1983 was Hernando de Soto, President of the Institute for Liberty and Democracy (ILD) in Lima, Peru. Mr. de Soto had the fundamental insight that poor people were not part of the development problem but instead part of the solution. In his best-selling books, The Other Path and The Mystery of Capital, he explained how the lack of access to property rights and other institutions of a market economy keeps the poor in most developing countries trapped in the informal sector.

In one of its first-ever programs, CIPE teamed up with de Soto and ILD to begin bringing the poor in Peru from the extralegal economy into the formal economy and the rule of law. As a result of ILD’s unique and innovative property rights and business reform program, Peruvian society received $18.4 billion in net benefits between 1992 and 1997, including saving formalized urban owners some $196 million in red tape costs.

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Egyptian Doctors and Freedom of Information

Egyptian doctors on strike. (Photo: Mai Shaheen/Ahram Online)

With all that is going on in Egypt these days, it is hard to take our eyes off of the Constitutional Assembly and the constitution drafting process. Yet if you look around the country, you will begin to see that the members of the constituent assembly are not the only ones mobilizing to secure support for broad-based reforms in the country. Last month, Egyptian doctors began to protest to demand better pay and working conditions.

Doctors have been on a partial strike since October 1 to demand an increase in health spending to 15 percent of the state budget, wage increases, and better healthcare standards and security at hospitals. A salary for a recently graduated doctor is 200 Egyptian pounds ($32.70) a month. But low pay is not the only thing new doctors have to worry about. Recently, there were two separate incidents where assailants attacked hospitals in Shubra (Cairo), and in the Al-Qantara Sharq (governorate of Isamaila).

The problems that plague the healthcare industry are endemic to the public sector as a whole, where public sector employees are paid very low salaries compared to other industries. With the dire state of the economy, it will be difficult for the Morsi Administration to raise salaries for doctors and other public sector employees without significant cuts in other areas. So where should the money come from? In the long run, the only solution will be to fix the underlying issues of corruption and bad governance.

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How Improving Egypt’s Business Environment Could Reduce Traffic in Cairo

Photo by Flickr user “tronics”

Having lived in Egypt as a kid in the early ’80s, I still have vivid memories of Cairo traffic – the honking, the intermingled smells of hot dust and exhaust and garbage, the sight of busses going by with people hanging from every handhold like a human fringe – everyone inching along and maybe, eventually, getting somewhere. According to a recent New York Times Cairo Journal article, A Dictator Is Gone, but Egypt’s Traffic and Congestion Seem Immovable, three decades and one revolution later the Egyptian capital still hasn’t resolved its congestion problems.

What struck me most about the article was the connection made between traffic and street vendors. The author quotes a tamarind vendor, Mohammed Ghaleb, who explains that his road-side business works because, “The people in the cars coming this way are all hot, and so they want something to drink.” The article interprets the chain of cause and effect a bit differently: “The people are hot, in part, because of the traffic, and the traffic is bad, in part, because of Mr. Ghaleb.”

Egypt’s President Mohammed Morsi seems to have bought this logic. He has pledged to remove the street vendors and reduce traffic, and has proposed building designated markets or market areas to bring order to chaos.

Designated markets are not always a bad idea, but in many countries such initiatives lead to “forced resettlement” of merchants and end in failure. Why? Because officials rarely think to involve vendors themselves when planning new markets. All too often they end up with shiny new buildings way outside of town. If you’re a vendor surviving on a very narrow profit margin, it’s often better to stay where you are near your clients even if it means continuing to dodge authorities when you must.

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Sesame Street, Swine Flu, and Unintended Consequences in Egypt

Zabbaleen boys in Mokattam Village in 2009. (Photo: Wikipedia)

“The law is not feeding me.”  That was the quote that really caught my eye.  At CIPE we talk about “Democracy that Delivers,” but I have never seen such a fundamentally honest and genuine expression of the concept – a democracy will not work unless it is delivering in tangible ways for its citizens.

“The law is not feeding me.”

The source was a black market pig farmer quoted in a fascinating article on a garbage collection crisis in Egypt in Monday’s Washington Post.  (And no, I didn’t know there was such a thing as a black market pig farmer, either.)  It seems that pigs raised by Cairo’s Coptic Christian Zabbaleen community used to consume a significant portion of the city’s garbage.  Reacting to the global swine flu epidemic in 2009, the Egyptian government slaughtered all of the country’s pigs and, from then on, banned ownership of trash-fed pigs.  This usurped the livelihood of the Zabbaleen – and resulted in a city-wide backlog of unconsumed, uncollected garbage.  To make matters worse, in the current economy, government-contracted sanitation firms are being short-changed by a full half of their fees and have had to cut back service accordingly.

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The other transition

Egyptians in Tahrir Square during the presidential election (Andre Pain/European Pressphoto Agency)

The turmoil engulfing Egypt’s presidential election has been a stark reminder of the difficulties the Arab Spring countries face with challenging political transitions. In countries where democracy has little precedent and where popular will was long suppressed, the new political opening has brought much anticipated civil liberties but also juxtaposed competing forces and diverging interests. Yet, among all the attention that headlines give to the political process, the story of another equally crucial transition – economic one – is often lost.

It is important to keep in mind that the roots of MENA revolts were both political and economic in nature, including demographic pressures, inefficient public sector, and constrained private sector. In other words, the lack of political freedoms was compounded by the profound lack of economic freedoms. That in turn fueled unsustainable levels of government employment and swelled the ranks of young people like Tunisia’s Mohammed Bouazizi who, without other viable options, strive to earn a meager living in the informal sector. A year and a half after Tunisia ousted its long-time authoritarian ruler, political transformation is underway but the economy struggles.

Many Tunisians who rose in protest against Ben Ali are disappointed with slow progress of reforms. Protestor Beshar Messaoud recently interviewed by NPR says that, economically speaking, things are exactly the same and the government has brought no solutions to the problems that led to the revolution in the first place. Unemployment is officially at 18 percent but it may actually be twice as high. Another interviewee, 35-year-old Laila Turki adds that if Tunisia doesn’t get its act together and improve its economy quickly, it will undermine its chances to build a functioning democracy.

But there are many misconceptions about what is needed for the economy to improve. For one, demands for economic change often focus on populist calls for more entitlements with little consideration given to how a sound economy capable of delivering sustained prosperity to its citizens can be built. What is more, the very understanding of what a true market economy entails has been tainted by decades of crony capitalism in the region. As a recent post on the Institute of Economic Affairs’ (IEA) blog points out, the meaning of “pro-business” in MENA has been warped: the “pro-business” policies of authoritarian leaders were limited to only one type of businesses – the ones connected to the government. That’s not the same as being pro-market, which requires allowing economic freedom for all segments of the society and building institutions that enable competition on a level playing field.

Instead, MENA ruling elites built systems that monopolized economic rents and jealously guarded their own economic privileges. That, in turn, necessitated the suppression of not just freedom of political expression but economic freedom as well. The legacy of that system is clearly visible in Egypt today. During the rule of post-independence leaders Gamal Abdel Nasser, Anwar Sadat, and Hosni Mubarak – all military men – the military has amassed a huge business empire in sectors from agriculture to electronics. Current estimates show that military-connected enterprises account for 10 to 40 percent of the Egyptian economy; meanwhile, more than 40 percent of Egyptians continue to live on $2 a day or less. Therefore, the real question of Egypt’s political transition is whether the formal return to civilian rule will translate into meaningful boost to pluralism on the economic front (pun intended).

The same goes for transitions in other MENA countries as well. Their success will depend on the degree to which the economic undercurrents of political turmoil are better understood and more effectively addressed, and the degree to which the misconceptions about the nature of market-oriented reforms are overcome. As the IEA blog emphasizes, a deeper reflection on the central place of the entrepreneur in economic development is needed, since “the future of the Arab Spring depends on the capacity of the new democratically elected governments to implement measures to prevent crony capitalism, restore the rule of law and promote economic freedom, in order to ensure general prosperity.”