in the offing By Gamal Essam El-Din In his speech to the opening session of the People's Assembly last week, Prime Minister Kamal El-Ganzouri said that the government has recently submitted to parliament a list of 19 draft laws and four presidential decrees. El-Ganzouri added that this list will be followed by yet another batch of bills which the government is very anxious to see passed in the People's Assembly this session. Although economic bills are not expected to figure prominently on the Assembly's agenda this session, government insiders point out that the list of draft laws includes at least three controversial economic bills. Topping the list is a new bill regulating the performance of the Central Bank of Egypt (CBE). During stormy debates last year on the privatisation of public sector banks, El-Ganzouri promised that the CBE bill would be amended to increase the bank's autonomy in decision-making. El-Ganzouri's promise came at the request of many deputies who expressed fears that privatising the giant public sector banks without empowering the CBE with stricter supervisory tools and more independence could present foreigners and business magnates with an opportunity to take control of the national economy. According to most deputies, while the central banking institutions of the major industrialised countries such as England and Germany are fully independent financial institutions, the CBE is largely controlled by the government and rarely acts as an independent financial watchdog. The major amendment in the CBE law states that the Central Bank, which is currently affiliated to the Ministry of Economy, will be transferred to the jurisdiction of the president of the republic. According to former Economy Minister Hamed El-Sayeh, placing the CBE under the president's direct purview provides it with the necessary independence and gives its governor the power and immunity he will need both to reinforce the bank's supervisory role and to formulate state monetary and financial policy. However, Mostafa El-Said, another former economy minister, says that giving the CBE full autonomy in decision-making does not mean the bank will be independent of the government's economic policies. "As far as I know, the new amendment aims at giving the bank greater powers for the coming period, especially when most public banks are due to be privatised. These greater powers are designed to protect public banks from foreign intervention or financial irregularities, and ensure that their policies remain in line with the government's socio-economic objectives and plans," El-Said said. Equally controversial is a new labour law designed to regulate relations between employers and workers in a market economy. The government has been sharply criticised by labour representatives, who say that discussion of the 300-article draft law in the People's Assembly has been deliberately delayed, even though the privatisation of public companies has been going ahead at full speed for the past six years. However, Minister of Labour Ahmed El-Amawi announced last week that the government has acted "only as a coordinator" between workers and businessmen in drafting the proposed bill. "The government just wanted to make sure that the draft bill regulating relations between employers and workers in a market economy is as balanced as possible," El-Amawi said. According to reports circulating in parliamentary circles regarding the contents of the draft bill, the government is seeking to give employers the right to lay off workers, but proposes sanctioning strike action by workers as a counter-balance. Worker representatives, however, stress that while the draft gives employers broad prerogatives to dismiss workers and reduce their salaries, terminate contracts and close down businesses without any prior notice, it still imposes significant restrictions on labour rights, including the right to strike. Businessmen, on the other hand, have expressed initial satisfaction with the draft law. Ahmed El-Boraie, a legislative expert who was entrusted by the government with drafting the bill, says that the text accurately reflects recent economic developments in Egypt. "We cannot expect investors to be interested in Egypt if labour relations are still governed by socialist-oriented laws. These laws have given workers sweeping powers. Now, in the context of a market economy, it should be admitted that employers should have more say in the running of their businesses," El-Boraie said. A long-awaited Unified Companies Law has also been drafted recently, with the objective of merging the various existing investment laws into one law. The first part of this bill, which is an amendment of Law 159 of 1981, was approved by the People's Assembly in its last session. According to Minister of Economy Youssef Boutros-Ghali, the comprehensive Unified Companies Law will be submitted to the Assembly during this session. The law aims to regulate the performance of different kinds of companies, such as joint-stock companies, limited liability companies, and partnerships limited by shares. The Unified Companies Law has long been at the top of businessmen's list of requests for improving the investment climate. One year ago, when an Investment Guarantees and Incentives Law was passed in the Assembly, businessmen charged that this law needed to be complemented by another law introducing a more simplified incorporation system for companies. Addressing in detail the objectives of the proposed Companies' Bill, a memorandum prepared by Mahmoud Fahmi, a corporate and investment law expert, explains that there are currently eight main laws governing companies and investment in Egypt. "The new Unified Law will govern all these kinds of companies regardless of the sector to which they belong, whether the private, public business or investment sectors, or of the percentage of private as opposed to public ownership", the memo said. It also added that the bill will establish a new type of company, known as the One Man Project Company, and a new system for company amalgamations and mergers, especially between public business and private sector companies, with clear dispositions concerning company division and change of legal form.
