Global economy seminar

Dr. Robert Wescott on Egypt’s development priorities

"Egypt and the global economy" was the topic of discussion for the first Global Economy Seminar in 2001, jointly presented by the American Chamber of Commerce in Egypt and the Management Development Initiative on January 14.

AmCham president Mohamed Mansour and Helmy & Hamza (Baker & McKenzie) partner Mr. Taher Helmy gave opening remarks highlighting similarities between MDI’s goals and those of the Chamber.

"Today’s Global Economy Seminar is of great interest to AmCham and its members, who, by definition, are people committed to building international trade and deepening relations with the U.S.," said Mr. Mansour.

Both opening speakers stressed the importance of privatization in development – providing a perfect lead-in to Dr. Robert Wescott’s keynote speech.

With over 20 years’ combined experience as an economist at the White House and the International Monetary Fund, Dr. Wescott is known as one of the premier experts on global economic development. Dr. Wescott’s speech dealt with many aspects of Egypt’s relationship to the global economy. He pointed out some of the most important challenges facing Egypt with regard to economic development in the 21st century, as well as the key policies that must be applied to meet them. These policies, broadly, must focus on development and ways to attract foreign investment. However, Wescott also warned that no economic policy is ever 100-percent successful. Even a measurable application of 70 or 80 percent of a policy can be considered a success, he said. "You must have strong social safety nets too in order to maintain social cohesion," said Wescott. "This is the secret of Poland’s success, for example."

The policies that will be most important for Egypt in the years ahead, Wescott stressed, will be free trade, decreasing the presence of government organizations and companies in the economy, and maintaining a strong network for social security. He said that other countries with track records of economic success had placed a high priority on education, raising wage levels and lowering levels of government spending, along with pursuing tax reform, privatization, protection of intellectual-property rights and the establishment of competitive exchange rates.

All of these policies, he said, are ways to foster ideal development. But this, he stressed, cannot be done without good leadership. "This is Political Economy 101 – leaders have to put the interests of the public before the interests of the few," he said.

Wescott concluded with a look at what Egypt’s priorities should be in the short, medium and long terms. In the next six months, the government has to keep a flexible pound as a cushion against economic shocks, and signal its commitment to privatization. In the next two years, the emphasis should be on maintaining 6-7 percent growth and complying with WTO standards, with a specific target to privatize 300 companies, he suggested. Then, three to 10 years ahead, the priorities should be expanding literacy, fostering the private sector as a source of jobs and protecting intellectual-property rights

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