By Salama A Salama The shock waves caused by the sale of Banque du Caire (BC) didn't subside, not even after the Central Bank of Egypt (CBE) governor admitted that BC was in such financial trouble that the CBE couldn't bail it out. The bank would have needed LE20 billion to float it, and the already over-burdened state budget couldn't take that additional burden. So the government offered to sell 80 per cent of BC's assets to a major investor, having concluded that merger or bailout were out of the question. This is the picture the government presented to a public that is no more literate in economics than myself, and yet the case has stirred quite a bit of controversy. Everyone had something to say, the specialists and the not so specialised, those who defend the government no matter what, and those who criticise it -- mostly for good reasons. One of the reasons is that the sale of Egyptian banks to foreign investors poses a threat to the national economy. It allows foreigners to control investment in development projects. And it might prove a drain on our financial resources. Regardless of who's right and who's wrong, the government is going to do what it has made up its mind to do. It will do so regardless of its repeated promises to act in total transparency. It will do so just as it did when it sold Omar Effendi and other public sector companies. The government has a commitment to international organisations to reform the banking sector. This commitment is more important to the government than transparency and the right of the public to know. The government has agreed to do so, and details of the agreements it made in this regard are not available to the public, but kept away from prying eyes, in one of the [desk] drawers of the National Democratic Party Policies Committee. The problem is not that we need to sell a commercial bank. The problem is not in how we go about it. These are matters that can be left to the specialists to decide. The problem is about how government tends to hide facts, cover up trouble, put off urgent problems, and generally hide its head in the sand until suddenly all hell breaks loose. The BC problem was not a new one. It dates back about six years. And successive governments have failed to address it, which poses a question about the moral and political responsibility of a number of former prime ministers and ministers. Time was that the BC opened its coffers to businessmen who borrowed to their heart's content, with no guarantees, and who then took the money and ran out of the country. That's the most likely reason for the bank's subsequent troubles. The Egyptian political regime doesn't believe in accountability. Top officials are never punished for the crimes of neglect, nepotism and financial irregularities. What happened in the BC case is happening elsewhere in Egypt. Suddenly, we started hearing about drinking water shortages in Cairo and other governorates. This too resulted from the government's tendency to push problems under the carpet. At some point, sedatives don't work anymore, and we're hit with a full-fledged crisis, one that is hard and costly to resolve. The same thing happened in the railway sector, after years of neglect and mismanagement. The government only realised the problem after accidents became a frequent occurrence. The same thing happened in maritime transport, where the government recognised corruption only after a ferryboat went down with 1,200 aboard, and the owner escaped the country. Don't blame the small officials, who lie to their bosses, or even the bosses who try to deceive the public. The problem is bigger than that. The entire government is lying and forging facts and figures. And the reason for this is that we have no accountability in Egypt. We have many agencies for auditing and transparency, and yet no one is ever brought to account.
