The need to industrialise Egypt

The missing element of the agendas of consecutive Egyptian governments is industrialisation; the Revolution must not make the same mistake

In order to change the system and realise the slogan "Revolution First", without ignoring the need to obliterate corruption, I believe that the January 25 Revolution still has not acknowledged that industrialising Egypt is a main tenet. Losses through corruption are miniscule compared to the incompetence of the former regime in managing and investing our resources in a way that ends our lingering behind the advanced industrial world, implementing social justice or upholding the motto "the poor first".
Without belittling the need to magnify the rewards of Egypt's multiple resources, I believe there is no alternative to industrialisation to end flagging income and potential, since it provides high production and revenue job opportunities. This is what is needed for fair distribution of wealth in a rich, advanced country, instead of fair distribution of poverty in a backward state.
To the readers who commented on my previous articles and argued that agricultural development should come first, I repeat that industrialising does not mean ignoring agriculture. An agricultural revolution preceding an industrial one is a logical necessity and an historic fact. The need to industrialise Egypt is affirmed once we agree that water and land limitations restrain the possibility of lateral agricultural development. Also, that it is impossible to raise Egypt's agricultural production without producing and distributing advanced industrial technology.
I reassert that distributing the fruits of industrialisation in other economic sectors is what made industrial nations key producers and exporters, not only of manufactured goods (especially ones requiring advanced knowledge and added-value), but also prominent manufacturers and exporters of foods, services, technology and knowledge. This is documented in relevant international economic reports.
By enhancing the potential of national production, industry also augments human and national security by meeting the needs of citizens, eliminating their concerns and fears, and boosting the immunity of the national economy against the risks of relying on fluctuating export revenues. Industry is a cornerstone for increasing overall power, including advancing limited military production– despite its promising potential – by lagging industrial technology.
Serious studies in this field assert that in this era of the economy of knowledge, industry is impossible without raising the standard of education, increasing spending and redistribution of available national abilities in research, development, production of knowledge and technical aspects. While Egypt's industry seems to have fallen far behind, even worse are the ramifications of neglecting industry by squandering the boost of the January 25 Revolution. What is taking place on the world stage and the possibilities on the domestic front are unlike anything witnessed by modern Egypt in the past, even during industrial national projects under the leadership of Mohamed Ali, Talaat Harb and Gamal Abdel-Nasser.
We should remember that South Korea began industrial exports at the beginning of the 1960s, as Egypt forged ahead with independent industry, and both were close in terms of development and population levels. In the early 1970s, Egypt and South Korea were among five of the most industrial countries in the South. Some explained the difference in performance as a result of problems in managing and funding industry in Egypt before and after the June defeat. Also, the contradiction in foreign support whereby the former Soviet Union wanted Egypt to become a model of its allies that have adopted socialist development polices; while the US urged its allies to exemplify capitalist development models.
Others believe the gap between industry and development was a result of continued protective industrial policies based on banning imports into Egypt, while South Korea adopted a policy of early openness to the outside through a strategy of production for export
Nonetheless, this gap did not widen until Egypt adopted economic “open door” policies as it looked beyond its borders and abandoned socialist development policies on the domestic front. As Egypt transitioned into a “free market” it abandoned the national project for industrialisation, while South Korea's adoption of a free market was rooted in industry. Although indicators were in favour of South Korea, the industry and development gap between the two countries remained narrow until the early 1970s – despite the burden of defence and war on Egypt in confronting the 1967 aggression. In fact, the added value of transformational industry was higher in Egypt than South Korea in the early 1960s; it became almost equal in the mid-1960s; as it dropped in Egypt, it became 78 per cent of the added value of transformational industry in South Korea in 1970.
In my article “Lessons of success of Korean industry” published in Al-Ahram newspaper on 30 December, 2007, I stated that South Korea's industry continued to grow as part of its remarkable development, while Egypt's industry regressed and as a result its development faltered. The gap grew wider between the two countries in terms of industry and standards of living. In this manner, the added value of transformational industry in Egypt dropped to a paltry eight per cent in comparison to South Korea in 1990.
South Korean exports, of mainly industrial products, increased by nearly 35 per cent on average per year between 1969 and 1993, namely 11 times the number of Egyptian exports of mainly primary products. South Korea's exports of equipment and transportation vehicles rose from a meagre one per cent in 1960 to 43 per cent in 1993; in Egypt, it froze at one per cent for a quarter of a century. South Korea was ranked 26 in the world for human development in 2005, while Egypt came in at 112.
Accordingly, I believe industrialisation was an “absent tenet” on the agendas of consecutive Egyptian governments since the launch of open door economic policies – which was the worst way to squander the gains of the October victory. Industry was not on the agenda of the previous regime either, even though Egypt had several historic opportunities to re-launch its industrial project. There were many incentives that were ignored, including the reduction of foreign debt, an economic reform plan, the economic gains of peace, renovated infrastructure, the creation of industrial cities and other such factors that had convinced international economic agencies in 1996 to rank Egypt's economy as one of the six most promising economies.
But at that particular time, the sinister plan for succession was brewing behind the scenes. The heir and his opportunistic entourage penetrated the presidency, whereby the succession project was adopted by the regime and made corruption one of its tenets. The goal of accumulating personal wealth and lavish spending replaced accumulating national wealth through investments in production.