"Jobs Are The First Priority"
Prime Minister Ahmed Nazif met with Editor-in-Chief Stephen J. Adler and other editors on May 17 at BusinessWeek's headquarters in New York. Here are edited excerpts of their conversation.
What is the aim of your reform program?
When we started back in July, [we had] one important objective -- to reform the business environment in Egypt, to restore confidence in the economy, and start to get it to grow at a higher pace. We were growing at anywhere between 3% and 4%. We need to double that in the next few years, to about 6%. We need to generate about 650,000 new jobs a year...We came up with a strong message to investors that Egypt is transforming its economic space.
What have been the results so far?
Inflation is coming down faster than we thought. Our currency has stabilized. Our foreign reserves have increased. Even the job offerings are starting to be there. [But] unemployment will not be solved in a day or two.
What areas are open for investment?
The opportunities for investment in tourism, for example, are endless. Our goal is to double our [tourism] income in the next five years. Another area is oil and gas. Egypt has found a lot of natural gas reserves, and this is creating opportunities. In industry, our privatization program, which had stalled, is back on track.
Is there resistance to reforms?
There is resistance to change always. It has been an easy way out of unemployment to hire people for the government. We have a lot of people who are underworked. [They] will resist any change in regulations. For the ordinary person, jobs are the first priority, prices and affordability are the second, government services are the third. There's a strong indication at the retail level that things are improving. Small merchants are selling more. Prices have come down. So [people] are starting to feel the change.
Is it true you don't expect real political change until 2011?
This is my personal opinion. The opposition parties will have a chance to field candidates [this year]. The problem is, can they field credible candidates? So to be pragmatic about it, if President Hosni Mubarak decides to run, I think it will be difficult to challenge him.
How does the Israeli-Palestinian conflict affect Egypt these days?
It's not affecting us per se, but the opportunity loss is high. Think [what it would be like] if there's peace, if the Palestinians and the Israelis are just two other states in the area that are good neighbors with Egypt. The possibilities are endless. We all look forward for something like that to happen.
(An extended version of this interview can be found online at BW Online, 5/17/05, "A Talk with Egypt's Prime Minister".)