IN FITS AND STARTS
year brings a fresh start. At least that’s what we tell ourselves as we jot down those resolutions to lose weight, clean out the closets, learn a new lan- guage and other perennial self-improvement goals. Egypt as well is experi- encing something of a fresh start, in the sense that a full, newly elected Parliament starts work for the first time since 2012. There may be a new Cabinet in the cards as well, as the current ministers must present a unified economic plan to Parliament in the first quarter of the year—MPs must then decide whether to keep the current Cabinet in place or start over with new ministers.
But much of what Parliament, the Cabinet and the country as a whole must do in 2016 is address the lingering issues of 2015 – dollar shortages, ambitious megaprojects, gov- ernment reforms and aging infrastructure. Under the Constitution, MPs are tasked with reviewing and approving all the legislation passed in Parliament’s absence – some 300 laws—within its first weeks. Among them are the sweeping new investment law passed in the run-up to last year’s Sharm El-Sheikh economic conference and the controversial civil service law introducing private sector HR practices to a bloated, inefficient public sector. Meanwhile, the long-promised value-added tax law has essentially been punted to Parliament, with Egyptian Tax Authority Chairman Abdel Moneim Mattar bluntly saying in November that the decision on when to implement the VAT is “100-percent political.” As part of our cover package, we look at the state of government reform in “Wooing the Market” on page 21.
The impetus for government reform is to attract investors to pay for its sizeable list of megaprojects, which President Abdel Fattah el-Sisi touts as a quick fix to create jobs and build infrastructure at the same time. The crowdfunding model of the New Suez Canal investment certificates isn’t viable for all the big-ticket public projects Sisi wants deliv- ered during his presidency, which include 4 million acres of new agricultural land, 3,000 kilometers of new roads and a completely new administrative capital. But as high-profile initiatives stall in negotiations, some analysts wonder if these projects are too big and too quick. “Is Bigger Better” on page 18 rounds up the pros and cons of megaprojects.
Amid the push for financing and investment, all eyes are on new Central Bank Governor Tarek Amer, who has the unenviable position of managing interest rates, infla- tion, anemic foreign reserves and a looming pound depreciation. His first month on the job, however, has not yet brought the longed-for clarity to the nation’s monetary policy. In “Hard Up,” on page 27, we look at the challenges facing Amer and their implications for the country.
There’s more to our roundup of the year’s big issues, so grab a cup of coffee and a doughnut – there’s lots to choose from, as we discovered in “Project Doughnut” (page 38) – and enjoy this month’s issue. Editor in Chief Rachel Scheier is off enjoying the holidays with family, so on behalf of the Business Monthly team, I wish you a Happy New Year and a fresh start.