Why was the NDP so wrapped up in economic reforms? Gamal Essam El-Din reads between the lines Last week's second annual NDP conference ended on an economic note, with a call for greater economic, fiscal and monetary reforms. President Hosni Mubarak's speech to the conference was mostly focussed on economic issues. Mubarak also met with the government's economic group immediately after the conference ended. The president said the liberal economic policies advocated by the conference should be implemented with poorer citizens in mind, and that the rights of employees at public companies slated for privatisation must be respected. Said El-Alfi, the chairman of parliament's Economic Committee and a member of the NDP, said it was only natural that a party striving hard to regain the confidence of the majority of Egyptians who have been struggling to make a living for the past three years, would concentrate more on economic issues than political reforms. With the party aiming to do well in both the presidential referendum and parliamentary elections that will be held next year, said veteran NDPer Mohamed Abdallah, lowering prices and raising the incomes of the limited-income and poorer classes have become a matter of life and death. As one NDP insider told Al-Ahram Weekly, earning the satisfaction of the unprivileged majority was far more important to the party right now than listening to the opposition cry foul over political reforms. In fact with the exception of the two hours spent on a discussion of political issues on the conference's second day, the three-day event focussed on a plethora of economic issues ranging from tax and customs cuts to conservation of agricultural land and improving national transport systems. President Mubarak had told Mayo, the ruling party's weekly mouthpiece, that, "we can't bring about the political reform we seek given the economic situation, and we can't attain justice without a strong economy." Gamal Mubarak, President Mubarak's 41-year-old son and chairman of the NDP's influential Policies Committee, was the driving force behind the conference's economic focus. On the first day, Mubarak, along with a mini-cabinet including ministers of finance (Youssef Boutros Ghali), investment (Mahmoud Mohieddin) and trade and industry (Rashid Mohamed Rashid), spent a great deal of time explaining the party's new economic philosophy. A 63-page "Economic Trends" report pointed to six issues: fighting poverty; safeguarding consumers against monopolies; reforming customs and tax systems; privatising the state's assets; reforming the fiscal sector; and reinforcing the policies of disclosure and transparency. In the presence of Prime Minister Ahmed Nazif and former Prime Minister Atef Ebeid, Gamal Mubarak said the NDP was aiming to liberalise the national economy and open it up to foreign competition. "To achieve this end, we [the government and the party] agreed that the old economic policies which depended on stripping society of the largest bulk of its income through taxes and high customs duties must be scrapped." "From now on," Mubarak said, "we will leave a large part of the national income in the hands of those who generate it, so they can spend it on products and expanding projects." Ghali said the government began implementing the new policy by lowering customs duties; a move set to cost the treasury LE3 billion. "This amount, in addition to expected cuts in both income and corporate taxes (set to go down from 42 to 20 per cent), will now be available for individuals or society as a whole to spend on products and services, and even on establishing new projects." Ghali said he was opposed to providing greater direct subsidies to poor and limited-income citizens. "Fighting poverty can be done via helping society acquire more money through tax cuts and customs reductions, and this in itself will lead to a fairer distribution of income among individuals." The conference also spent time discussing the conservation of Egypt's agricultural land. A 19-page document warned that with Egypt's population set to grow to 96 million by the year 2020, there would be a pressing need to both build new desert communities and protect agricultural land from degradation or loss to haphazard communities. Prime Minister Ahmed Nazif's conference speech was also entirely focussed on economic issues, thus reinforcing the feeling that had taken hold amongst observers since his appointment last July: that he would not be very involved in political issues. Nazif said his government would be implementing ten economic programmes in the next phase. These include customs, tax, and banking reform, upgrading education, improving public services, conserving natural resources, upgrading the state's administrative system, improving health services and controlling population growth, and establishing a vibrant domestic information technology sector. Opposition party circles, meanwhile, were not very enthusiastic about the party's new fiscal policies. Leftist Tagammu MP Abul-Ezz El- Hariri told the Weekly that the NDP's economic focus was mainly aimed at laying the groundwork for the 2005 parliamentary elections and presidential referendum. "By reducing custom duties and lowering income tax, the NDP is trying to gain the confidence of the majority of Egyptians who suffered as a result of the flotation of the Egyptian pound." El-Hariri said that, "in any case, we all know that the NDP will dominate the elections; its new economic measures, however, are aimed at uprooting the seeds of public discontent which have increased since 2003."
