Unrest costs Egypt economy $3.5 billion

The price tag for the labor unrest and political protests that have roiled Egypt since the outbreak of the mass demonstrations that ousted President Hosni Mubarak has reached 20.5 billion pounds ($3.5 billion), the country's finance minister said Thursday.

The total was a fresh indication of the bruising taken by the economy since Mubarak's ouster in February. Worker demands for higher wages and ensuing strikes have compounded problems caused by the near-daily protests that continue in the Arab world's most populous nation.

Finance Minister Samir Radwan said that 13.5 billion ($2.2 billion) of the losses were in the tourism sector -- an Egyptian mainstay that has been damaged badly since the start of the Jan. 25 revolution. The remainder is the cost incurred by the Treasury.

The government, following the uprising, pledged several billion pounds in compensation and unemployment insurance to mitigate the losses sustained by Egyptians during the almost three-weeks of chaos before Mubarak was pushed from power.

Years of surging prices, high unemployment and widening income disparity were among the key catalysts for the mass uprising that ousted Mubarak. But even as the country's military rulers and the current government push forward on political reforms, Egyptians complain that life has yet to return to any semblance of normalcy.

The finance minister, who has been shuttling to the U.S. and other countries trying to secure financial aid and lure investors back to the country, said Egyptian exports have dropped 40 percent from pre-Jan. 25 levels while manufacturing is limping along at 50 percent of its capacity.

He said in a statement released by the Finance Ministry that the various strikes and protests are the "main reason" why the budget deficit was growing.

Radwan was in Washington last month where, according to Egypt's official MENA news agency, he requested $2.2 billion in "soft" loans from the World Bank and between $3 billion and $4 billion in similar loans, "without conditions," from the International Monetary Fund.

The deputy chairman of the country's investment body said Tuesday that foreign direct investment, which was forecast at $7 billion for the fiscal year ending June 30, was now expected to come in at between $3 billion to $4 billion.

Radwan said, however, that the foundation of the Egyptian economy remains strong and that Arab countries have expressed strong interest in investing in the country.

The minister also said the government was working on a new law setting minimum and maximum wages -- a key demand of protesters -- but noted that such wage caps needed to be linked to productivity.

Radwan said that the productivity of Chinese workers was three times that of their Egyptian counterparts, the statement said.

Category:

News & Politics

Tags:

• Unrest
• costs
• Egypt
• economy
• $3.5
• billion

[boomba3]

sad to say egypt will never recover i`v been watching in the past 48 years