Mubarak instructs Cabinet to improve economic performance
Egypt, Economics, 5/25/2000

President Hosni Mubarak yesterday chaired a meeting with the Economic Ministerial Group followed by a full Cabinet meeting at the Presidential Palace to discuss the outcome of the current economic policies.

Minister of Information, Safwat El-Sherif briefed reporters on the issues discussed during the meeting, indicating that the President reviewed the performance of major economic sectors in the country over the past few months.

The President listened to comprehensive presentations outlining the major indices reflecting the performance of the Egyptian economy.

Prime Minister Atef Ebeid said the most important index was achieving an average growth rate between 5 and 6 per cent between 1998 and 2000, adding that the national economy was expected to continue to grow further during this fiscal year.

Inflation rates steadily declined and hit a bottom of 3 per cent in March. In addition the deficit level which stood at 4.2 percent in 1998/99 was expected to drop to 3.7 percent this year thanks to the intensive efforts exerted to increase state resources and economize expenditure. The state seeks to curb deficit to less than 3 percent in 2001.

The Prime Minister explained that the overall volume of debts on the government reached LE 8.6 billion in June 1998, adding that the government would repay these debts over the next three months.

After listening to the Prime Minister¹s review, Mubarak asserted that every possible effort must be made in order to guarantee that investments are directed to necessary socio-economic aspects to promote comprehensive development.

He also underscored the absolute necessity of curbing the level of deficit without affecting growth rates.

He also clarified that no further projects are factored in the state's investment plans without thorough feasibility studies to identify their short and long term objectives and ensure their compatibility with the general plan of the state.

"The President emphasized that no allocations should be earmarked to new projects without accurate study and intensive Cabinet discussions," Minister Sherif said.

Mubarak also stressed that new projects should be financed from real resources in order to guarantee their viability. The President said it was necessary to develop the country's resources, especially the oil and gas sectors to guarantee a substantial increase in the state revenues to cope with increasing expenses.

Mubarak advised all ministries to draft ambitious, but down-to-earth, export objectives and give undivided attention to improving the quality of products and enhancing marketing efforts.

"The Egyptian leader told the Cabinet that the repayment of state debts should be financed from real resources. He said the revenues generated from public subscription in the Telecom company and other partially privatized public enterprises should be directed towards financing the repayment of these debts," Sherif said.

Mubarak also gave clear instructions to develop tax collection mechanisms to combat tax dodging, adding that transparency was one of the most essential principles in economic performance. He called on the cabinet to get tough with violators.

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