Egyptian President Hosni Mubarak, facing unprecedented protests calling for his ouster, appointed a new Cabinet and named Samir Radwan, a former senior economist at the International Labor Organization, as finance minister.
Radwan replaces Youssef Boutros-Ghali, according to a statement read on Egypt’s state-run television. Radwan was also a board member of Egypt’s General Authority for Investment. Mohammed Hussein Tantawi kept his post as defense minister and was named deputy prime minister. Mahmoud Wagdy was appointed interior minister, replacing Habib El-Adli, whose resignation protesters have demanded.
“We have lost an exceptionally good minister of finance,” said Angus Blair, the Cairo-based head of research at Egyptian investment bank Beltone Financial. “His successor will have to be equally good or better to bring about improved sentiment in Egypt at the moment.”
Mubarak, 82, instructed the Cabinet to fight corruption and curb inflation, which was 10.3 percent in December, according to a statement read out on state-run television today. He also told Prime Minister Ahmed Shafik, a former air force commander, not to cut subsidies and to balance wages with prices.
Egypt, the world’s biggest wheat importer, subsidizes fuel, electricity, and basic foods such as bread and sugar. In October, the government announced additional spending of as much as 3.5 billion Egyptian pounds ($600 million) to cover the rising food bill.
‘Hit The Economy’
Radwan, in an interview with Bloomberg Television yesterday, said that the unrest has “hit the economy and hit it very hard.”
“There was a very clear appetite on the part of Arab and foreign investors to come to Egypt, basically because they had suffered from the economic and financial crisis and now with these disturbances they will think twice before coming here,” he said. Radwan was also an adviser of the Egyptian Financial Supervisory Authority, which regulates financial markets.
Hani El-Husseini, a tax expert and member of the economic secretariat of the opposition Tagammu party, said he had “a positive view” of Radwan.
The protests, which erupted Jan. 25, were inspired by a revolt in Tunisia that toppled President Zine El Abidine Ben Ali on Jan. 14. Both North African countries suffer from high unemployment, especially among youth.
Boutros-Ghali, who was named finance minister in 2004, is chairman of the International Monetary Fund’s policy committee. During his tenure he slashed income and corporate taxes to 20 percent from 40 percent and 42 percent respectively.
Oil Minister Sameh Fahmy, Electricity and Energy Minister Hassan Younes, Foreign Minister Ahmed Aboul Gheit and Communications Minister Tarek Kamel were among ministers who kept their jobs in the new Cabinet.