The Middle East Channel

Egyptian businessmen eye the future

The fall of steel magnate and ruling party leader Ahmad Ezz captures one narrative about the uprising in Egypt — the revolt against crony capitalism. Ezz played a major role in the fraudulent parliamentary elections last fall that wiped out the entire opposition and left Egyptians feeling angrier than ever at the government.  Now that ...

AFP/Getty Images
AFP/Getty Images

The fall of steel magnate and ruling party leader Ahmad Ezz captures one narrative about the uprising in Egypt — the revolt against crony capitalism. Ezz played a major role in the fraudulent parliamentary elections last fall that wiped out the entire opposition and left Egyptians feeling angrier than ever at the government.  Now that Ezz has been stripped of his political offices and his fortune frozen it’s easy to believe two, somewhat contradictory things. One is that all businessmen are leaving in fear that they will be next. The other is that the Egyptian economy will "return" to being a truly free market economy.

Both are wrong. While some businessmen have left, other extremely wealthy and prominent individuals are throwing themselves into politics. And Egypt has never been, either from the 20th Century down to the present, a particularly free market economy. The calculations of Egyptian business can be seen within the emerging groups of self-styled "wise men" (including several women) offering proposals for a way out of the impasse. 

It is significant that the "wise men," including several business figures as well as other prominent Egyptians, published its appeal in the daily newspaper Al-Shorouk. Al-Shorouk began as a publishing house associated with the Muslim Brothers. With the loosening of controls over freedom of expression, publishing houses like Shorouk began to sell a much wider array of literature from across the political and intellectual spectrum.  Several years ago the Shorouk newspaper came into existence primarily to compete with the major independent daily, Al-Misry al-Yawm. While it features a column by Muslim Brother intellectual Fahmy Huweidi it also publishes a very wide array of comment including by secular liberals and others. The evolution of Al-Shorouk indicates how one particular brand has broadened its reach as the political and economic climate has changed.

Publishing this statement in Shorouk showed where the signatories wanted to place themselves: smack in the middle of the growing liberal middle-class intellectuals for whom the "market of ideas" is a prized feature of contemporary life. Many on the list are well known intellectuals long connected to demands for democratization and liberalization such as Amr al-Shobaky (associated with the semi-official Ahram Center for International Studies) and Kamal Abu al-Magd (associated with the liberal current of Islamist attorneys and law professors). Two other signers are former Egyptian ambassadors to the U.S., including Nabil Fahmy who is now a dean at the American University in Cairo. Their presence signals the degree to which people who were formerly closely associated with the functions of government now turn out not only to be critical but willing to say so in public. Amr al-Hamzawy, the recently designated official spokesman who been associated with the Carnegie Endowment in Washington, is a clear statement that Egyptians with direct connections to institutions outside the country, including the U.S., have as much legitimacy to ask for change as anyone inside.

Equally important signers are prominent businessmen. Perhaps the most recognized signer outside Egypt is Naguib Sawiris. Sawiris, said to be the 374th richest man in the world, is an owner and board member of Orascom and plays a key role in the telecommunications in Egypt (Mobinil). There were rumors shortly after January 25 that Sawiris had left Egypt, rumors which swirled around many very rich people, including some very famous entertainment figures. Instead, Sawiris announced that he was with his employees at a construction site (his larger family firm is also in the construction business as well as telecoms). His presence on the list crucially indicates the degree to which sections of the economic elite are breaking with the government. Given the importance of connections to the state for making business work here this is indicative of how broadly the incompetence and corruption of the regime has antagonized Egyptians. Sawiris is not in competition with the army-based industries which are mainly in metal-working, some food production, and the like. He does represent a challenge to both to restoring a large state sector and to the intensely crony capitalism that dominated the last decade of the Mubarak regime, personified in the now disgraced steel magnate Ahmad Ezz.

Anis Aclimandos is a signatory whose name will not mean much to Americans but he is also a prominent figure in the business community.  His firm is engaged in planning and managing project development.  Many of these projects mobilize domestic and foreign capital. Finally, there is Safwan Thabet (the name is mis-spelled in the English version where it appears as Safwat).  Thabet, 63, is chairman of the board of Juhayna Food Industries. Juhayna, which has been in business since 1983, is an extremely large producer of milk, milk products and juice. His particular firm is closer to competing with the army which is also engaged in this sector of the economy. Thabet, unlike Sawiris, is not a member of the Coptic minority and seems to be more closely connected to the rest of the business community.

Despite some early panicky claims that the business elite and the middle class are sending everything out of the country thus causing a run on the pound and a collapse of the stock exchange, at least some very wealthy and prominent members of the business elite have chosen to stay. The focus up to now has been, and correctly so, on the remarkable bravery and steadfastness of the hundreds of thousands (or more likely millions) of people who have faced physical danger and death by demonstrating in Cairo, Alexandria and elsewhere. They are the ones who have changed Egypt, but in so doing they have also allowed others who will also have a role play, to come out into the open and demand structural changes. These major businessmen will be key to what kind of new Egypt emerges.

Ellis Goldberg is a professor of political science at the University of Washington and a visiting professor of political science at the American University in Cairo.

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