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Al-Ahram Weekly 23 - 29 March 2000 Issue No. 474 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 23 - 29 March 2000 Issue No. 474
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| Published in Cairo by AL-AHRAM established in 1875 |
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Document
Egypt Region International Economy Opinion Culture Features Focus Travel Living Sports Profile People Time Out Chronicles Cartoons Whither USAID?
The three key pillars of the United States Government's relationship are strategic cooperation, collaboration in the Middle East peace process, and the US-Egyptian Partnership for Economic Growth and Development. US government's assistance focuses primarily on the Partnership, and is crucial to meeting foreign policy goals more broadly.
This new USAID strategic plan shifts the focus of US government development assistance from aid to trade and investment. It takes into account Egypt's emerging-market status and integration into the global economy, as well as a mutual interest in stronger U.S.-Egyptian private sector relationships. It also supports Egypt's efforts to meet the human resource challenges posed by the global economy, to create 700,000 new jobs annually, to preserve the country's natural resource base, and to improve delivery of selected social services.
Accompanying this shift in program focus are a five per cent average annual reduction in assistance levels in the 10 year period, from $735 million in FY2000 to $407.5 million in FY2009.
TRENDS AND CHALLENGES: Over the past 20 years, Egypt has made tremendous progress. It has strengthened its macroeconomic discipline, privatised many public sector investments, and entered the ranks of emerging economies with annual GDP growth rates exceeding 5%, low inflation, high reserves, and per capita income of nearly $1300 a year. Because of substantial infrastructure investments, Egyptians now have reliable power, dependable water and sewerage, and functioning telecommunications. Actions have been initiated to improve environmental quality. Enrollment in the formal education system has increased, along with a growing enrollment ratio of female students. Statistics for life expectancy, infant mortality, and population growth all indicate favourable trends. Expanding the scope of political participation is a stated aim of the government of Egypt.
Nonetheless, challenges remain to Egypt's full participation in the global economy. Despite good performance on a number of macro indicators, Egypt has been less successful in reducing poverty. There may be various contributing factors including policy constraints, a work force growing faster than job creation and an educational system which is not providing all the skills and skill levels needed by the economy and low levels of investment in training. The sustainability of infrastructure services requires opportunities for private sector investment dependent on improved regulatory policies and cost recovery systems. Key environmental issues -- reducing urban/industrial pollution, improving the use and quality of Nile River water resources, preserving Red Sea natural resources, and promoting energy efficiency -- continue to demand attention. Fertility must fall further to help contain expenditures for social services and to reduce the growth of the labour force and the persistence of poverty.
PLAN GOAL: A GLOBALLY COMPETITIVE ECONOMY BENEFITING EGYPTIANS EQUITABLY: It is against this backdrop that USAID, the GOE and other development partners have worked together to develop objectives and programmes to build on past achievements and to meet the future challenges of establishing a relationship based on increased trade and investment. The challenge, however, is more than economic growth alone. To be globally competitive and sustain economic growth, Egypt must translate growth into good jobs for those who need them, avoid environmental degradation, and offer adequate services. The goal of the USAID/Egypt 2000-2009 strategy is a "Globally Competitive Economy Benefiting Egyptians Equitably." Two subgoals further define this strategy: creating private sector jobs, and sustaining Egypt's human and natural resource base.
CREATING PRIVATE SECTOR JOBS: On average, each of the next 10 years will see 700,000 new entrants to Egypt's labour force. To meet this demand, Egypt needs to expand investment and trade, promote workforce development for the private sector, and ensure an adequately developed and maintained infrastructure base. Central to this strategy is the positive role job creation plays in reducing poverty, a relationship which studies in other countries have confirmed. The relationship is strengthened when the pace of economic growth is increased, when labour-intensive industries and small/medium businesses are emphasised, and when capital market activity is increased. This strategic plan incorporates all of these factors.
ENVIRONMENT FOR TRADE AND INVESTMENT STRENGTHENED: The policy framework for trade and investment will be improved, private sector competitiveness increased, and opportunities for business growth enhanced (including those for small and emerging businesses). Programs supporting policy reform, commodity import programmes, and targeted technical assistance and training all will support achievement of the objective. Expected impact includes increases in job creation, domestic and foreign investment, domestic savings, and exports.
Skills for Competitiveness Developed: This programme will target Egyptian workers who are literate and will include workers who are in management or who have management potential. It will strengthen Egyptian private sector management and training providers, and ensure that training institutions provide services based on demand and in growth areas. As a result of the programme, companies will strengthen their competitiveness, new workforce entrants will have stronger basic business skills and the potential for higher earnings, and the provision of more relevant and market-driven training will increase.
ACCESS TO SUSTAINABLE UTILITY SERVICES IN SELECTED AREAS INCREASED: As the mission's infrastructure programme winds down, the focus will shift to enhancing the provision of services and the environment for increased private sector investment and improved efficiency through strengthened commercial practices of utilities and improved legal and regulatory frameworks in targeted sectors. Expanded and efficient infrastructure services will improve urban environmental quality, public health, and economic productivity.
SUSTAINING THE HUMAN AND NATURAL RESOURCE BASE: The GOE and the USG agree that growth and jobs cannot be pursued in Egypt in isolation from concerns about social development, environmental sustainability, and poverty alleviation. Therefore, this strategy's second subgoal is to help Egypt sustain its human and natural resource base. Sustainable growth requires protection of the environment and natural resources base. Equitable job creation requires a literate and healthy workforce. And private sector led investment requires high quality services, which are best achieved by participatory and transparent governance.
MANAGEMENT OF THE ENVIRONMENT AND NATURAL RESOURCES IN TARGETED IMPROVED: Environmental challenges having an impact on Egypt's growth and quality of life will be addressed through institutional and policy reform, capacity building, public-private partnerships and citizen awareness activities. Four areas will be targeted: Nile water, Red Sea natural resources, urban/industrial pollution, and energy efficiency. Programmes initially will help improve management systems, formulate policies and regulatory standards, and increase institutional capacity for monitoring and enforcement. Activities leading to actual improvements to environmental conditions will follow. Having these systems in place will support increased competitiveness and a healthier environment.
HEALTHIER, PLANNED FAMILIES: Support will continue for family planning, reproductive health, and maternal/child health services as preparations are made for a systematic transfer of funding and management responsibilities to Egyptian organisations (public and private) which will sustain programme achievements after the end of USAID funding. The programme will work in underserved areas and will encourage greater private sector involvement. Overall, the national economy should be stimulated by the benefits of lower population growth and improved health.
EGYPTIAN INITIATIVES IN GOVERNANCE AND PARTICIPATION STRENGTHENED: Support will focus on achievable objectives in strengthening civil society, improving the rule of law, and increasing participation and quality of services in selected communities, with the option of expanding activities in the future if Egyptian initiatives make that feasible. Expected results include improved capacity of civil society organisations, increased participation in local decision-making, and improvements in selected areas of the judicial sector.
BASIC EDUCATION TO MEET MARKET DEMAND IMPROVED: A time-limited special objective in basic education will demonstrate effective models of basic education delivery, community involvement, and the special needs of girls, with replication on models being continued by the GOE, the World Bank, and other donors. There also will be programmes to strengthen English language skills and school-to-work activities.
Source:
US Embassy press office
