The facts of

Egypt show that in a country where power is not constrained, the privatization policy aimed at reversing the losses of state-owned enterprises and improving economic efficiency and national income has become a cover for the corruption of the Mubarak family and privileged class.

Mubarak family photo. From left to right are Heidi, the eldest daughter-in-law, Ella, his wife Susan, Mubarak himself and Gamal, the second son.

since the second half of the 1970s, a wave guided by privatization and the implementation of market economy has swept a large number of third world countries, but the consequences are different. In some places where democracy and legal system are not perfect, economic reform with a good starting point often becomes a tool for a few dignitaries to harm the public and enrich their own interests. Egypt, which has just experienced the baptism of revolution, is an example.

during the 30-year ruling period, it is a well-known fact that the former Egyptian President Mubarak family abused power for personal gain and seized huge wealth. At present, the public is most concerned about how much of this ill gotten wealth? According to an earlier report by Al Jazeera television, the Mubarak family has been widely involved in the privatization process, amassed $40 billion to $70 billion through family businesses, and opened secret accounts in a number of foreign banks. Mubarak’s personal wealth may be $15 billion, his second son Gamal is about $17 billion, and his wife Susan has $5.3 billion. They are all regular guests on the rich list.

perhaps the answer will be clear only when the judicial judgment of this strong man is finally announced. At present, the procuratorial organs have frozen multiple accounts of the Mubarak family in Egypt, with $147 million in his wife’s name. This is obviously just the tip of the iceberg – Mubarak’s act of enriching his family and friends almost runs through the whole process of Egypt’s economic transformation; With the help of power, more wealth is transferred to complex interpersonal networks and investments around the world, and then disappeared.

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were two presidents. They reformed

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twice. Sadat became president of Egypt in October 1970 and soon began “reform and opening up”, trying to solve the problems of domestic people’s livelihood with the mechanism of market economy. The academic circles call it “consumption oriented opening up”. The basic idea is to introduce capital and technology to promote economic growth.

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stimulated by relevant policies, Egypt has ushered in an “era of hope”. With the end of the war with Israel, the economy of this ancient country has taken off miraculously, and many indicators are higher than those of ordinary developing countries: from 1970 to 1979, the average growth rate of GDP reached 7.6%, and the annual growth rate of per capita income reached 6.7%; In 1980, the wealth brought back by 3 million workers working in the Gulf countries alone was as high as $2.7 billion.

Sadat was assassinated during a military parade on October 6, 1981, and Mubarak succeeded him. After taking office, the new president, who was born as a pilot, made further adjustments to economic policies. He encouraged investment, transformed deserts into farmland, tightened spending and curbed consumption, which is “productive opening”.

another commitment of Mubarak is to promote the privatization process to “invigorate the economy”. However, the privatization reform in Egypt did not go smoothly at first. In the late 1980s, the state-owned economy still accounted for half of Egypt’s industrial production and 90% of the banking and insurance industry. At least 20% of the labor force worked in state-owned enterprises.

beautiful blueprint for economic reform

with the great changes in the international pattern, Egypt’s economic reform could not be delayed in the early 1990s. However, reform requires funding from the International Monetary Fund and the world bank. Both institutions said that they no longer want to support an economy that relies so much on state-owned enterprises. If they want money, Egyptian state-owned enterprises must be privatized.

in order to obtain emergency assistance, Egypt agreed to brake the “major surgery” on the economy and adopt the free economic system that has been accepted by most countries in the world after the disintegration of the Soviet Union. In the theorists’ beautiful vision, this system can help the public get rid of poverty, promote the formation of the middle class, and finally achieve the democratic reform of the political system.

a long report published by the US Post recently pointed out that in 1992, the think tank called “Egyptian Economic Research Center” (ECE) was born and said that it would promote economic reform through publishing books, issuing policy documents and holding meetings. Washington has also provided nearly $8 billion in aid to its North African friends.

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various facts since then show that in a country where power is not constrained, the privatization policy aimed at reversing the losses of state-owned enterprises and improving economic efficiency and national income has become a cover for the corruption of the Mubarak family and Egypt’s privileged hierarchy, and ECE is their profit-making weapon. The result of such a privatization, the Washington Post wrote, “was a great surprise to Americans”.

corruption hides behind prosperity. ECE gathered a group of Egyptian business leaders in a small circle. At the center of the circle is Mubarak’s youngest son, Gamal, 47. As the “most powerful supporter” of privatization reform, he studied at the Cairo branch of American University. After graduation, he entered the American Commercial Bank and was responsible for investment banking. Later, he set up an investment company “medinvest” with his eldest brother Ella in 1996. He made money by buying and selling Treasury bonds, and his assets exceeded US $100 million in a few years. Gamal also has a foreign nickname – “Jimmy”, which shows how independent he is in Egypt with Islamic culture as the tradition. When Gamal entered the financial industry, he met a lawyer named Tahir hemi, who was ordered to draft laws and regulations on the privatization of state-owned enterprises in Egypt in 1991. According to the plan, more than 350 companies (with total assets of more than 100 billion US dollars) will be transferred to private ownership. ECE was also built by Gamal and hemi. The most significant turning point occurred in 2000, after Gamal and his followers joined Egypt’s ruling party, the National Democratic Party. A series of moreRadical laws and policies have been introduced one after another, and many are directly based on the “Research Report” of ECE. In 2002, Mubarak promoted Gamal to the chairman of the policy committee of the National Democratic Party, equivalent to the third leader of the party. The military divisions of ECE also crowded into the policy committee one after another. At that time, Hermione, who was the chairman of the think tank, would not be left behind. Since then, Egypt’s privatization process has soared all the way. In 2003, nine enterprises with total assets of US $18 million were privatized; In 2005 and 2006, 59 companies were privatized with total assets of US $2.6 billion. On the face of it, this transformation is beneficial to Egypt’s economy, and the country’s GDP growth is also fast, reaching 7%. In a telegram sent to Mubarak’s top diplomats in Egypt at the beginning of 2006, however, they may have different views on the reform of the U.S. regime, “Corruption will also hinder economic growth. When economic reform moves forward, corruption will become more difficult to curb.” “ECE always appears in the right place at the right time,” said Mahmoud muhidin, then chairman of the ruling party’s Economic Committee. “ECE has a set of plans that are enough for the government to do whatever it wants (in the process of privatization).” From selling artists to steel king, ECE’s office is located in the Nile city building, a landmark building in Cairo. In this granite exterior building, there are also many multinational enterprises, such as P & G, Motorola and AIG. Through the operation of hemey and others, Baker mckens international law firm headquartered in Chicago has handled privatization transactions with a total value of more than $3 billion, including the sale of government assets, companies and land. On the surface, the firm represents the Egyptian government, but behind its back, it is doing business of selling state-owned enterprises to private companies at low prices. Among the dignitaries who have benefited from ECE, Egypt’s “steel king” Ahmed izz is prominent. Izzy was just a band drummer who made a living by performing. Since making friends with Gamal, he has made rapid progress. He started from the small blacksmith shop founded by his father, successively merged many state-owned iron and steel enterprises, and established a state-owned iron and steel company with more than 7000 employees. In 1998, Alexandria steel company was on the verge of bankruptcy. With the help of Ibrahim Salem muhammatian, then Minister of industry and trade of Egypt, izz earned the company through illegal capital operation, and became a new rich man in the wealth territory of the Middle East. Its steel production ranked first in the Arab world, More than the world’s top 500 enterprises – Saudi Basic Industries Corporation. He also used his monopoly position to manipulate steel prices and exacerbate inflation in Egypt. A recent research report by the German Marshall Foundation shows that ECE helped Izzy make huge profits. For example, in 2004, Hermione threw out a regulation that sharply reduced the corporate tax rate to 20%, making Izzy’s steel kingdom a windfall. The next year, Hemy was involved in drafting a competition law to protect Izzy’s company from monopoly charges. Another person who tasted the sweetness of privatization was Ahmed al magrabi, a real estate developer who later became Egypt’s Housing Minister. He and his nephew owned the most famous real estate company in Egypt, “palm mountain development company”. Through the relationship, it is easy for men and children to get cheap land and tax concessions. Prison will be their destination. On the dark side of Egypt’s privatization process, a book that was not allowed to be published because its content was “too controversial” before the revolution gives these figures: since Mubarak’s privatization reform began, the total price of Egyptian public assets sold is less than one tenth of their actual value. Magda kandir, the new director of ECE, revealed that due to corruption, the total value of assets sold at a low price in Egypt since 1991 has been only $9.6 billion, accounting for about 1% of GDP, while their actual value is about $104 billion. “Some privatization deals are really strange, fattening those who should have supervised the process.” Candier said. After the Egyptian revolution, five people related to ECE were prosecuted for corruption. In addition to Gamal, IZ, magrabi, former interior minister Habib ADLI and Tourism Minister zuhail jalana were also prosecuted. Now, in addition to Izzy hiding in Britain as an “apartment”, the other four have been imprisoned together with Mubarak.