Friday,21 September, 2018
Current issue | Issue 1194, (24-30 April 2014)
Friday,21 September, 2018
Issue 1194, (24-30 April 2014)

Ahram Weekly


Al-Ahram Weekly

The cost of reform

Everyone wants to have a balanced budget, a fuel cost that is environmentally friendly, and a social insurance system that guarantees that the needy receive the care they deserve.

But who is to pay for all of that?

Let’s not beat around the bush. Our economy is shambles, and things are likely to get worse before they get better. Even the most optimistic estimates envisage three years before the economy is back on its feet, and only with the injection of nearly $70 billion.

So it is no longer a luxury to get our budget straightened out, the subsidies to fuel slashed to a reasonable level, and a serious investment programme off initiated.

The only problem is that, every time our governments try such a thing, it is the poor and needy that end up paying — through higher prices — for the price of growth.

For a country that had two revolutions in succession, it is remarkable how we don’t seem to be able to put two and two together. Without social justice, there can be no economic growth — no stability in the system either.

Admittedly, this is a catch-22 situation, where the needs of social justice seem to contrast those of economic growth.

We all know that reducing our fuel bill is inevitable. But there are ways of doing so and demolishing your political credibility — as both the Mubarak and Brotherhood regimes did to their chagrin — and ways to do it where the public gives you a measure of support.

Gamal Abdel-Nasser did it with a reasonable measure of success. When the country was facing a Western blockade in the 1950s, he told the nation to reduced its consumption of sugar and eat more rice instead of bread.

The nation listened to Abdel-Nasser, for the simple reason that he had their trust. They knew that he had a programme to industrialise the country, and they were hopeful that sacrifice would lead to reward.

This is the magic word. For the government to be able to introduce a reform programme, it has to show the nation that it has a credible programme with a chance for success, and that the inconvenience of reform is but a temporary blip on the country’s rise to a bigger and better future.

We cannot dally much longer. With subsidies eating up one quarter of the budget, tourism in hiatus, and joblessness on the rise, immediate action is needed on the economic front. According to estimates, one out of every four Egyptians — even more in the south — live under the line of poverty.

This situation needs to be reversed, but the road can be too bumpy for the government to stomach. For the past three decades or so, our governments have been less than sincere about the subsidies issue. It all started in 1977, when massive riots followed the removal of subsidies, forcing the incumbent president, Anwar El-Sadat, to reverse his government’s decisions and send the army into the streets.

No one wants a repetition of that, but stealth is not the answer to the question of subsidies. This nation deserves to hear it from its leaders. If sacrifices are needed, we need to be told for how long, why, and how.

We cannot keep asking the poor to foot the bill for reforms while the wealthy are getting wealthier. A sense of proportion — in a nation that has staged two revolutions in quick succession — is needed.

The government is said to be planning to enlarge our social security programme. Smart cards for fuel are also on the drawing board. And our top officials mentioned the need for more spending on education and health.

This suggests that the need for reform is now acknowledged in the highest echelons of government. But reform will require a high level of finesse, honesty, and inspiration that we haven’t seen in this country for a long time.

Confronting the issue will not be easy, but time is running out. Not only is the IMF expecting us to slash subsides, Gulf countries who so generously supplied us with fuel over the past few months are demanding the same.

We have to face the moment of truth. We have to make reforms. But we must make sure that any sacrifices demanded by this nation will be share by all and not the vulnerable alone.

add comment

  • follow us on