When President Mubarak smiles with satisfaction while touring some project, his smile immediately turns into resolutions. When he shows signs of dissatisfaction, opposite resolutions come to effect. And when he points with his finger, it is taken as explicit instructions and directives that should not be discussed. But in his speech addressing Parliament, Mubarak did not resort to such signs for Central Bank President Farouk el-Oqda to know what he wants from him. Instead, the president explicitly demanded to reduce credit charges so as to help the economy survive the repercussions of the global financial crisis. So interest on credit given to investors and businessmen would go down so as they can meet the liquidity crisis that threatens with an increase in unemployment. Two weeks ago, I wrote in this space, calling on Dr. Oqda to do the very same thing and take after the Central Bank of England, the European Central Bank and the U.S. Federal Reserve Board. The Monetary Policy Committee that is chaired by Dr. Oqda had met just hours after the decision of the Central Bank of England and decided to retain the interest on loans given by Egyptian banks, which seemed very strange. Dr. Oqda probably wanted to decrease the inflation rate at the time. But he should also take other things into consideration, such as meeting the desires of the investors and the economic group of the ministry, which were embarrassed to ask him in so many words.
The ministry puts down fiscal policies while the Central Bank puts down monetary policies without interference from the government. So Dr. Oqda knows very well that each day's delay in cutting the interest rate, we pay for it in the form of recession and stagnation. He also knows that the president's instructions did not come by chance and should not go in vain.
