Field reports say that maintenance of the local road network has almost come to a complete halt because the soaring prices of oil derivatives have caused around 75 per cent of road contracting companies to withdraw from the market. Daker Abdallah, member of the Egyptian Federation for Building and Bridges Contractors, warned that the road network would suffer dilapidation within months since many companies that are still striving to survive are currently working two days a week only. He told Al-Shorouq Arabic daily that bitumen used heavily for macadamising has shot up in price fivefold whereas fuel oil has almost doubled its price in a period of two months. The amounts of diesel and fuel oil that the companies can get from the black market is sufficient for the operation of heavy equipment only twice a week, Abdallah stressed. The construction and paving of roads have also been suspended owing to the low profile of security especially on highways and cross-country roads. Abdallah explained that ransacking of goods and materials carried by trucks to work sites have caused companies to cease their activities for a while, not to mention the effects of the frequent blocking of roads. Meanwhile, the economic crisis has not only affected road contractors but has had a similar impact on the contracting sector in general. Rough estimates speak of l3,000 companies that deal with the government and which have been forced to take their hands off. The causes, as experts say, are no secret since they concern the government's lack of cash, the high currency exchange prices in favour of the US dollar, a budget deficit and increasing prices of fuel and building materials. The government has noticeably stopped tendering bids and putting forth new projects for two years being unable to pay due funds which it owes contractors. According to Ismail Osman, Deputy Chairman of the Egyptian Federation for Construction Contractors, several companies have gone bankrupt. He further explained that a large number of companies declined to submit licence renewal applications to the Federation. “Large property developers usually rely on sub-contractors, which means that the suspension of government building projects causes about eight million workers engaged in related activities to go out of work", Osman told Al-Gomhuria daily. The collapse of the tourist industry, as affected by political unrest and poor security, has also caused once brisk hotel and resort building move to stop for the time being, which has in turn adversely affected the contracting sector. Official records pinpoint that the government is indebted to contracting companies by LE l3 billion, of which it has only paid LE two billion. Mohamed el-Masry, deputy Chairman of the Commercial Chambers Federation, believes that contracting companies would not possibly be lifted up unless comprehensive economic reform is brought about. “This requires political concord in order to start approaching security and economic problems." El-Masry warned that by May, the import of raw materials would be rather unaffordable since foreign currency reserves have diminished to US$ l3 billion at a time when imported goods and raw materials are estimated at LE six billion a month.
