Now that Mubarak is gone, will attention in Egypt turn to the economy?
Now that the throngs of protesters massed on the streets of Cairo have succeeded in pushing out Hosni Mubarak, they might want to turn their attention to economic reform.
One factor underlying the animosity toward Egypt’s fallen president was a large and growing gap between rich and poor that led to extreme poverty among the lower class even as the country’s economy expanded in recent years.
The top one-fifth of the population controlled 41.5% of the country’s wealth as of 2005, while the bottom fifth held a mere 9%, according to a study by Global Financial Integrity, a Washington research and advocacy organization. And the gap almost certainly has widened in recent years, according to the study.
A big reason for the income inequality is rampant corruption and related problems.
The Egyptian economy is losing an estimated $6 billion a year to corruption, crime and tax evasion, according to GFI. The cumulative loss from 2000 to 2008 was $57.2 billion.
“What is happening in Egypt is the result of a systemic condition of which Mubarak was just one part,” said Dev Kar, who coauthored the study. “Weak governance allowed rampant bribery, theft, crime and tax evasion to drive billions of dollars out of the country every year. The annual loss of money, which seriously hampered the government’s ability to stimulate economic development and alleviate poverty, made President Mubarak’s dictatorial regime unbearable and brought Egypt to its current state of social and political unrest.”
-- Walter Hamilton