THE CHRONICLES ECONOMIC AND BUSINESS HISTORY RESEARCH CENTRE CHRONICLES JANUARY—MARCH 2006, VOLUME 1 / ISSUE 3

The American University in TABLE OF CONTENTS

The Editor’s Note 2 EBHRC CHR O N IC L E S

Editor: Dina Khalifa Hussein From our Archives

Director, EBHRC: Margins of the Economic Past 3 Prof. Abdelaziz Ezzelarab A Prologue to ’s 5 Project Officers: Industrialization Mostafa Hefny Mohamed I. Fahmy Menza Graveyards and Digital Recordings 7 Wael Ismail

Administrative Assistant, EBHRC: Interview Yasmeen Samir When Firms and Entreprenures Cross Borders 12 Young Scholars Contributors: Zeinab Abul-Magd Jano Charbel Historical Perspectives Amr Nasr El-Din Lee Nunley Egyptian Textile Workers in the 16 Karim El-Sayed Transition to a Neo-Liberal Order Dina Waked The Story of Egyptian Railroads 19 Guest Contributors: Prof. Joel Beinin The Nurturing of Wealth: The First Call for a National in Egypt 23 Layout &Design: Translated Manshour p. 26 Magda Elsehrawi Logo: History in the Making Nadine Kenawy Law and in Egypt 30

THIS ISSUE HAS BEEN COPY EDITED BY Skirmishes in the War for Drugs 34 Prof. Hala El-Ramly Ms. Jayme Spencer The Chinese Real Estate Boom 38 Prof. Herbert Thompson

******* In the Pipeline Egypt’s Trade Unions: About EBHRC 44 EBHRC Supporting Institutes: Reason for Hope or Hopelessness Center for Middle East Studies, Harvard University Business Not as Usual Near East Studies Program, Princeton University Traditional Crafts—An Untraditional Source of Income 47 Middle East Center, University of Pennsylvania Middle East Center, Research Ideas University of Washington Global Business Center, Business School, The Laws of Competition 50 University of Washington Office of Provost, AUC Book Review Office of Dean of BEC, AUC Economics Department, AUC The Story of an Arab on Wall Street 52

EBHRC Collaborating Scholars: Prof. Ellis Goldberg, Our Archives 54 (University of Washington) back Announcements Prof. Roger Owen (Harvard) cover Prof. Robert Tignor (Princeton University) Prof. Robert Vitalis (University of Pennsylvania) Cover image: Salim Khalil al-Naqqash, Misr lil-Misriyin. (Alexandira, 1884) 1 EDITOR’S NOTE

EDITOR’S NOTE...

istorians and storytellers have a lot in common. They both endeavor to describe a story that occurs between a spectrum of fiction and reali- ty, and mostly precedes a present disquiet and delve into the past, narrating details of incidents and how they occurred. More ambitious historians attempt to propose an answer to a question, such as what Hwent wrong? People’s memories is the reservoir for our quest to revisit historical incidents and narrate similar historical stories and questions. Some of these mem- ories expose a history on the margin of mainstream literature. The Chronicles’ From our Archives section presents stories of Egypt’s industrial experience and more importantly highlights the human factors behind important policies and their execution.

In an interview with Prof. Geoffery Jones, we delve into the intellectual develop- ment of a prominent business historian, and explore how business history is and should be conducted. Prof. Joel Beinin gives voice to the marginalized, the work- ers whose story is traced through their strikes and protests. Jano Charbel recounts the story of the unions and syndicates.

As in all historical stories, the writers’ treasures are old documents that are them- selves the foundations of historical realities. In this issue, Prof. Abdelaziz Ezzelarab introduces a communiqué or manshur titled “Inma’ al-Mal” (“The Nurturing of Wealth”) which was issued in April 1879 and urged the public to found a joint stock national bank through public subscription. Its opening statement claims that God commands people to invest in nurturing natural wealth. Thus, the first call for a national bank is nourished by a religious lingua whose consequent his- torical repercussions are raised by the author.

We present this issue of The Chronicles as an intertwining of historical stories and contemporary realties. We shift between digital recordings of oral history to old documents and newspaper clippings among other sources to present 14 articles, with immense gratitude to our contributors and supporters.

Dina Khalifa Hussein, Project Officer, EBHRC

NOTE OF GRATITUDE One of our colleagues made a career shift last month. Wael Ismail is one of the founding project officers of the center and was present since its conception. We are immensely grateful for Wael’s contributions and wish him the best in his future plans. We also send our best wishes to Dina Waked, Karim El-Sayed, and Omar Cheta, our colleagues and friends who have embarked on new careers, and thank them for their continuing support.

2 FROM OUR ARCHIVES Margins of the Economic Past

Wael M. Ismail, Project Officer, EBHRC

oices of those on the mar- possessed a liberal economic system, gin are easily swept under the revolution came to change all that “... To truly under- the carpet of great events and transform the country and the of a nation’s history. The economy into a state-run enterprise. The stand the impact of m a rginalized have been death of brought Vcast in the past as those oppressed new waves of reforms that culminated economic policies, classes of the underprivileged, the poor in the 1974 October paper that ushered and the working classes. Our definition the way for the open door policy and a it was essential to of the term has to be broadened how- complete change in the country’s eco- ever for us to truly understand the nomic policies. It would seem that Egypt grasp the point of course of events. The marginalized are for the past fifty years has been working not necessarily those mentioned above, its way back to the pre-1952 current view of the men in some cases they are not those work- state of things, although this brief outline ing on the factory’s floor but those sitting of the country’s economic transforma- responsible for their in their offices higher up the ladder. tion might be true to an extent; this is an outline that stands on shaky ground. execution ...” Egypt’s economic history can be summed up with ease into neat, clear For the past two years, interviews con- cut compartments and epochs. Looking ducted by the Economic and Business dent) helped illuminte issues concerning from the outside it would seem that History Research Centre brought to the Egypt’s industrial experience - especial- before the 1952 revolution the country fore, at least to the interviewers con- ly after 1952. To truly understand the ducting interviews with various public impact of economic policies, it was officials, whether ministers or public sec- essential to grasp the point of view of tor managers, new issues and questions. the men responsible for their execution. “... the marginalized The roster of interviewees was mainly D r. Gazarin’s input mainly re v o l v e d focused on individuals who had played around Al Nasr Co.. From his account of are in some cases an important role in shaping Egypt’s the ups and downs of this fallen giant, a economic past. Their reflections on their number of observations can be extrap- not those working careers and current state of things pro- olated. The importance of such an duced a number of interesting and account and others compiled is that on the factory’s insightful narratives. These narratives these figures witnessed the changes often opened a window onto a past that occurred in Egypt’s economic poli- floor but those that was blocked by mass generaliza- cy as they took place. They were not tions and assumptions usually taken for themselves marginalized, but their sitting in their granted about the epochs discussed. accounts and narratives were clearly marginalized when Egypt’s economic offices higher up Dr. Eng. Adel Gazarin, was one of the history was numerously. Listening to Dr. first interviewees. His tenure at Al Nasr Gazarin narrate his own version of the the ladder...” Automotive Co. and his involvement in past, a number of issues that were for- institutions such as the Egyptian merly taken for granted were problema- Federation of Industries (former presi- tized in light of the new material.

3 FROM OUR ARCHIVES

of the state’s political agenda. On more than one occasion Dr. Gazarin “.. The marginalized spoke of how some policies that were “... The enacted severely impacted the public have been cast in sector and, in particular, Al Nasr Co. transformation of According to him the company was the past as those b u rdened with so many projects, it this class of never had the chance to specialize in oppressed one area and excel in it. From the out- executives from set the company, everything was politi- classes of the cized, from the pricing of the cars that entrepreneurs in was determined by politicians to the underprivileged, refusal of partnering foreign capital in their own right the establishment of the company. The the poor and the latter reason contributed to the failure (albeit in public of the company as Dr. Gazarin noted, working classes. especially if Al Nasr was to be com- sector firms) to pared to the other car manufacturing Our definition of the companies that were established in the exactly what critics Far East with the participation of foreign term has to be capital leading to various success sto- of public sector ries. Another major problem that the broadened company faced was the introduction firms warn against of the labor force as important players however for us to on the board of the company under is an issue that is Nasser. The workers gained numerous truly understand the rights that according to Dr. Gazarin rich and intriguing, were abused, and, on more than one course of events ...” occasion kept the management from yet remains largely running the company efficiently. What is mentioned in this article, are glimpses unexplored by The narrative offered by Dr. Gazarin of what the entire narrative offered. gave birth to numerous perspectives, researchers in the some already known to the academic In these holistic narratives dealing with public and others, which are not. One the economic , rarely do economic and of the most interesting issues raised in we find mention of the role of the man- the interviews with Dr. Gazarin was the agers of public companies. In most business history of intangible benefit of the public sector cases they were merely executives. endeavor that Egypt embarked upon. Clearly there is more than one exam- Egypt ...” Talking about the public sector Dr. ple of managers who were not blindly Gazarin mentioned the difficulties that following orders but were individuals mangers of public companies faced - who truly cared for the enterprise they from lack of investment, to poor eco- were running. The account given by Dr. nomic and financial planning. Gazarin is invaluable on its own; how- exactly what critics of public sector However, he was also aware that these ever, such an account gains a whole firms warn against is an issue that is rich companies, and Al Nasr Co. in particu- new perspective when it is amassed and intriguing, yet remains largely unex- lar, acted as an “academy” that grad- with other narratives from the same era plored by researchers in the economic uated executives who gained experi- of individuals who had more or less the and business history of Egypt. ence and know how in the company same position, whether as managers of that they later transferred to the private public firms or policy makers involved Such narratives, more than anything sector where they now work. with economic policies. else, help us shed some light on areas that have been untapped by research, The three interviews conducted with Dr. either because of ignorance of their Gazarin off e red a run down of the Dr. Heba Handoussa is an economist existence or due to the lack of research impact of various economic policies on and an academic who also worked as material. These counter narratives, so to Egypt’s industrial sector. From his post as a consultant for various ministers of speak, allow us to see what could have the longest, serving chairman of Al Nasr industry over the years. In an interview happened and what actually did hap- Co and later as the ’s with her, she commented on the state pen in the end. They are pathways to a Federation of Industries, Dr. Gazarin of public sector managers in the 1960s, treasure of missed opportunities that spoke of how the state’s attitude asserting that with the increased gov- are at times more telling about an era changed re g a rding the country’s ernment role, managers of public sec- than those chances taken. industrial base. Dr. Gazarin was equally tor firms were transformed from daring critical of both the nationalization laws young executives to mere bureaucrats. of the 1960s and the open door policy The transformation of this class of exec- adopted under Sadat. In both epochs utives from entrepreneurs in their own the economy was left under the mercy right (albeit in public sector firms) to

4 FROM OUR ARCHIVES A Prologue to Egypt's Industrialization Dr. Ismail Sabri Abdallah introduces the human elements behind Egypt’s industrialization

Dina Khalifa Hussein, Project Officer, EBHRC

he economic history of Egypt Egypt’s industrialization and national- the extraction and recording of such is founded on the decisions ization policies and how did they func- information. of political rulers-independ- tion? This is the focus of this article, ent and otherwise. which is extracted form a series of inter- The importance of such endeavor is Mohamed Ali might be the views with Abdallah. that it provided a unique opportunity Tfirst in a line of political leaders who for Abdallah and his team to study the shaped modern Egypt’s economic his- Data collection and research that the various sectors in the Egyptian econo- tory and Gamal AbdelNasser has policy makers and economic planners my, the position and status of each sec- strongly staked his position in this histori- undertake are significant to their deci- tor and the key companies within them. cal structure. A myriad of arguments sion-making. Abdallah was the eco- In addition, it highlighted the relation- are still sounded, almost on daily bases, nomic authority inside the EDO, which ship between the Egyptian economy that are either critical of Nasser’s era or was responsible for administering the and foreign companies. It is worth not- in praise of his policies. In most cases, nationalization process. It is interesting ing that according to Abdallah, a com- we are left to bay the moon, searching to note that Abdallah, one of Egypt’s pany such as al-Bayda was very signifi- for a clear understanding of Egypt’s his- prominent economic planners, shaped cant in the textile sector. It was benefi- torical experience, particularly when it his understanding of the status of cial to other textile companies since it comes to industrialization. Wi t h o u t Egypt’s economic position thro u g h introduced to the market some essen- p romising any easy way out of this studying the companies that were tial feeding industries, such as the dying dilemma, it becomes insightful to look involved in the process of nationaliza- industry. Through EDO data collection closer at how the players of this era tion. The EDO was established in 1957, efforts, it was possible to understand introduce the story of Egypt’s industrial- after the war, to administer the inter-company relations and to obtain ization. Egyptianization and nationalization a clearer picture of industry in Egypt. process. Through the EDO, Abdallah Moreover, it demonstrated the relation- Dr. Ismail Sabri Abdallah was less than was able to establish a system of data ship between the various industries and thirty years old when he was first asked collection from the companies that service sectors such as transportation. to be a consultant for Nasser. In an w e re considered for nationalization, The story behind the EDO and its data environment that applauds young peo- which became a significant source of ple’s involvement in public policy, an information on Egypt's economic sta- ideological conflict occurred between tus. According to Abdallah they used “...Nasser, Nasser and Abdallah. “Nasser wanted to study all the conditions surrounding to benefit from me as an economist, the companies and the companies Abdallah stated, while fighting me as a communist, so I themselves were the source of informa- ended up most of the time, either in a tion. They implemented a proficient sys- was from a rural position of power in the or tem of studying the companies through as a political prisoner,” Abdallah stated. promoting a new method of preparing background and He was the head of the Economic and the companies' annual reports - adding Financial Division at the Economic new information on the sector that the was convinced Development Organization (EDO) at company belonged to and its relation the time of the implementation of the to other sectors. Information on the that agriculture nationalization policies, and he chose company's competitors, its market to introduce us to the narrative Egypt’s share, other companies' market share alone will not solve industrialization by focusing on the and labor information were also human factor behind such policies. added. This was done through sending Egypt's poverty...” Who were the economists, engineers, a team of economists who used to industrialists and policy makers behind spend 15-30 days to train employees in

5 FROM OUR ARCHIVES collection mechanism is significant in “... the high dam Prior to what Abdallah called “serious understanding how the economists industrialization” by the Egyptian engi- responsible for nationalization formulat- was first conceived neers and academicians, the situation ed their knowledge of the Egyptian was one he characterized as a collage economy that consequently shaped as a tool for land of haphazard initiatives of "venture the decision making process. capital." The success stories were initia- reclamation that tives that mirrored the already success- The nationalization of the early 1960s is ful sectors, such as the textile industry. a key event in the economic history of would increase As for the military engineers or the new modern Egypt and a central feature in industrialists, they chose the iron and the country’s path to industrialization. steel industry as their starting point. Nevertheless, the controversy concern- Egypt's agriculture From an engineering perspective, this ing its appropriateness is huge and was a typical starting point for countries beyond the scope of this piece. capabilities...” in earlier stage of industrialization given However what is worth highlighting is their interest in ensuring adequate sup- the perception of those who were industrialization. The original concep- plies of basic raw materials that are responsible for this policy. According to tion was based on the hope that the necessary inputs for establishing indus- Abdallah, the process took two major dam would fulfill the hopes of the small- try. This, according to Adballah, was turns. The first stage of nationalization est of peasants by availing three fid- not always economically efficient. It was dominated by an understanding dans of agricultural land to each of would have been best, for example, to that only foreign companies [viz. them. Nasser's background as import raw iron rather than manufac- European or American] with key eco- described by Abdallah made him con- turing it given its low share in the final nomic positions are to be seized. As an cerned with the agricultural laborers product. The material outlook that the example, the famous Shamla depart- commonly re f e r red to as 'umal al- engineers held in their undertaking of ment stores did not fall in the national- tarahil, who are transported from one the industrial project lacked efficiency ization grip given their origins as Tunisian piece of land to another to work on a considerations, essential as they are jews, in spite of the fact that its owners haphazard seasonal manner with very from an economic perspective. held French citizenships. On the other low day by day wages. Abdallah stat- hand, the insurance companies that ed that such laborers were one of the Abdallah insisted that Nasser's policy w e re under foreign control were reasons that made Nasser consider the and the environment in which the revo- nationalized due to their power as industrialization option as a solution to lution's policies were formulated were major saving and investment agents. Egypt's developmental problems. He mostly not ideologically based nor The EDO, according to Abdallah was further stated that this shift to industrial- were they an attempt to copy other concerned with the companies that ization was not based on ideological or countries' models. Abdallah tried to had a downstream or upstream multi- t h e o retical grounds, but on Nasser's explain some of the intellectual and plier effect. He added that mistakes understanding of the reality of chal- human factors that accompanied occurred in the nationalization of the lenges facing Egypt. This shift material- Egypt's industrial experience. He added publishing sector and other small sec- ized when Aziz Sidqi established the that more attention should be paid to tors were due to the fact that some Ministry of Industry and commenced the role of the military engineers when ministers and others bought many of the first industrialization plan 1958. studying Egypt's industrialization, espe- the foreign establishments that were cially that they performed a remark- under custody. As Abdallah reiterated, Abdallah claimed that Nasser believed able job in operating the the EDO was not a holding company in a trial and error as the approach by Company after nationalization. The but a developmental agency, since it which indigenous Egyptian calibers nationalization of the Suez Canal, he used some of its resources to establish would drive the country. Thus, Nasser explained, was not a decision taken on new companies and study the sur- advocated free education to give the spurt of the moment, but required a rounding conditions thoroughly to an opportunity to enhance close study for two years by three com- ensure their continuity and success. their capabilities. An obvious move mittees. Abdallah acknowledged the towards industrialization took place in problems that Nasser's policies bore, It is futile to approach the policies of the 1950s and among its major contrib- namely the mammoth bure a u c r a t i c the State control era without touching utors were a group of military engi- system and lack of freedom of expres- upon Nasser's policy- making strategies. neers. Those engineers were the ones sion. He concluded that Nasser's expe- Being a consultant for Nasser during this who proposed the establishment of mil- rience was a very unique one and era, Abdallah unveils some of Nasser's itary industries during Farouk's era and what Egypt needs now is , perceptions. Nasser, Abdallah stated, visited various European industrial com- which is the only guarantee for sustain- was from a rural background and was plexes and studied business administra- able development. convinced that agriculture alone will tion and other critical disciplines, which not solve Egypt's poverty. It would nei- made them qualified to contribute to ther attain its own developmental the industrialization effort. Among those ISMAIL SABRI ABDALLAH headed the goals nor create employment opportu- engineers are Sidqi Soliman who super- Economic and Financial Division of the nities for the masses. He argued that vised the establishment of the high Economic Development Organization the high dam was first conceived as a dam and Moahmed Younis who head- (EDO) in 1957. He was the General Director tool for land reclamation that would ed the Suez Canal Company. At the of the Institute of National Planning (1969- increase Egypt's agricultural capabili- same time, Nasser depended on acad- 1977) and the Minister of Planning (1971- 1975). He is currently the Chairman of the ties, contrary to the widespread belief emicians such as Aziz Sidqi and Third World Forum. that it was established solely to pro- Mostafa Khalil to lead the industrializa- duce electricity that was crucial for tion endeavor. 6 FROM OUR ARCHIVES

In November 2005 the Economic & Business History Research Center held a panel entitled “New Approaches in Business History” at the Middle East Studies Association [MESA] Conference in Washington DC. The following is an excerpt of “On Business History”, one of four papers presented dur - ing the session. In the excerpt the center’s oral history methodology is considered before selection of the center’s oral history archive is surveyed with the aim of demonstrating the possibilities of using this type of oral record in the writing of history.

& Digital Recordings The Apparatus of Economic & Business History Research Center

Mostafa Hefny, Project Officer, EBHRC.

The Modus Operandi the task of chronicling 20th century technique of oral history is first a political through the democratizing process that gives voice Prior to its official establishment, history of enterprise and governance in to the marginalized and inarticulate; a EBHRC’s director assigned some his stu- a way that best suited the prevailing counter-history through which a stance dents and former students at the conditions. In this way business history that is a priori established as antitheti- American University in Cairo the task of released the center from the ivory cal to a prevailing history is put forth. reviewing the available literature on tower to which many historians remain Business History, which, at that point, confined. Ground level turned out to Of this way of thinking arise two imme- was assumed to be a discipline whose be a fine place to start. diate implications: First, the venerable tenants could be examined for appli- egalitarianism that motivates the seek- cation in an Egyptian context. An Hence the method of oral history. ing of the accounts of the marginal- intensive three-day seminar was held ized and inarticulate will inevitably on the subject. It quickly became clear As a mainstay of anthropological prac- a g g regate said accounts in what that what had started as a question tice, oral history’s considerable tradi- would amount to a community history. about the applicability of the pillars of tion is more inclined towards service to Second, the assumption that oral histo- business history for our purposes that social science. It remains nonethe- ry provides a "counter-history" is became a search for those very pillars. less, in the parlance of another social embedded with the assumption that a We started out questioning whether science, fungible; a method to be history to which the aggregated voices business history could travel from its molded and remolded. The anthropol- a re contrasted already exists. For bases in 20th century and ogist's fingerprints are however unam- EBHRC, working in the mostly unsullied Western Europe only to find that the biguously betrayed in the considerable field of Egyptian business history this pri- discipline had disintegrated prior to literature on the method and tech- mary protagonist, the anti-hero against takeoff. Business history maybe defined nique of oral history. Consider The which oral historians seem to rally, sim- as a nexus of variably incorporated Voice of the Past: Oral History by Paul ply did not exist. Although the social sciences bound by demonstra- Thompson, a complete textbook. accounts obtained by the center fre- ble behavior of economic actors in his- Marrying a procedural approach with quently clash with official stories and tory. an argumentative one, and therefore popular myths, the disorderly state of raising the discussion above the mere- those stories and myths makes disqual- Business history failed to provide EBHRC ly technical, the author offers a highly ifies them from any mandate over with a theoretical framework with readable work that provides instruction what can authoritatively be identified which to proceed. The absence of a to the collector of oral accounts whilst as the mainstream. The center's framework is far from a crippling making an argument in favor of oral accounts, because of novelty of the impediment to practice. Indeed it is history as a valuable medium. In doing field, will inevitably be central to any the docility of the field of business his- this, however, he betrays an ideologi- discussion of Egyptian business history. tory, and the variability of the material cal presumption that limits the use of For EBHRC, the interviews were never p resented under its auspices, that the apparatus for the center. For going to be method to amass an alter- enabled the center to proceed with Thompson, an oral historian himself, the native history. 7 FROM OUR ARCHIVES

In the literature of oral history one finds worker to have been substantively approach continued, but experience allusions to the unique suitability of oral involved in the immense flux of had refined the apparatus to include history to the countries of the South resource allocation that characterized an initial meeting with the subject in where it is claimed that oral tradition the state-led industrialization of the which a free flow of memory was has been more thoroughly embraced early 1960s, a decisive span in the eco- encouraged with the subject having because of the absence of institutions nomic history of Egypt, that person been made aware of the framework of that provide raw material for more tra- would likely have been, at least, in his inquiry which, in turn, had been refined ditional, i.e. written histories. Here are thirties. This in turn makes potential pur- to addressing the relationship of tentacles of a West-East clash: does veyors of first hand experiences of that finance and Egyptian industry. The this development of a well meaning important time a group with a mini- interviewers would listen to a recording blanket method for the "South" not mum age of seventy. The connotation of the initial session and formulate a carry the assumption that there are no of this elementary observation is not series of questions that connects the traditionally decipherable institutions in limited to the need for urgency. That subjects’ experience with the frame- a country such as Egypt? Or is it, in much is obvious. What had concerned work of inquiry. This procedure gov- counterpoint, in fact a call for histori- us at EBHRC was what this rush to inter- erned the reminiscences to the gener- ans working in Egypt to explore unique, view those most likely not to be avail- al topic without unnecessarily curtail- local, methodologies of which oral his- able for testimony in a few years would ing potentially valuable inform a t i o n tory is a mere example? do as far as the cohesiveness of the that had not been targeted before- center's output was concerned: If the hand by the interviewers. The clash is a false one. At EBHRC the most important criterion for choosing a incongruity of the oral history method- subject becomes their age this would The apparatus was taking shape. Yet ologies proposed by the literature was demote other considerations such as as more and more interviews were due more to the implicit purposes of sectoral analysis and other unifying recorded there were fresh concerns the process rather than where and by themes to a secondary status. This fear about the final form this labor would whom it was developed. It was indeed however proved to be unsubstantiat- take. Here we entered into the perilous the western institution of Columbia ed as the interviewees themselves realm of the transcript – the bête noire University and the system it had proved the greatest source for other of the EBHRC project officer. devised that added the most to the potential oral history subjects who, in EBHRC's intuitively devised oral history many cases, traveled in similar circles, "People," writes one commentator on apparatus, of which an overview is worked in the same sectors and were oral history, "do not usually speak in now in order. of a similar age. paragraphs"(1) . We are well advised in the literature on oral history of the dan- Egypt remains without a tradition of gers of distorting the intonations and f ree access to document. Oral “...In contrast to meanings of the oral record during the accounts are not without their objec- process of transcription, a process that tive advantages over written docu- military service in is described by this commentator as ments, but this is a case where talking one of temptation and decadence. (2) to the decision makers, administrators Latin America, a and entrepreneurs was less a matter of No one at EBHRC ever courted such preference than an imposition by cir- necessary stage in temptations. The center's first attempt cumstance. The narratives of Egypt's at transcription was scrupulous in its industrial and entrepreneurial experi- the life of young fidelity to the recorded interview inas- ence are absent from the written much as it was a verbatim transfer of records. Those interviewees are there- aristocratic heir, the record to paper. The interview, fore the guardians of a history that has conducted over five sessions was with never been made available to schol- the Egyptian army Eng. Mohammad Abdel-Wa h a b , ars, let alone the public. Specialized as Egypt's Minister of Industry from 1984 to they often are, many remain innocent was shunned by 1993 - a period through which he was of the historical value of their experi- involved in protracted negotiations ences. A coherent synthesis of the tes- the landowning with the International Monetary Fund timony of officials, bureaucrats, admin- over the form of Egypt's adoption of its istrators and businessmen is a prism elites and structural adjustment program. The full- through which an historical perspec- ness of the account was such that tive will almost certainly be entire l y embraced by EBHRC later developed a workshop original. during its annual May forum devoted classes who would entirely to issues raised by the inter- Then there is the quandary of time. view. Yet none of this was evident in Oral history maybe richer source mate- otherwise have the ad verbatim transcript. In fact if rial than accessible written documents one were to successfully wade through but its sources are human - and mortal. had no access to the colloquial of that first docu- It is a delicate but unavoidable fact ment one would more likely be left with that the guardians of pre c i o u s scatterings of meaning barely deci- accounts of economic and business education...” pherable to a native speaker who had endeavors are in many cases in the h e a rd the oral re c o rdings. The twilight of their lives. An invaluable his- As interviews continued in the fall of prospects of this document being of tory of Egypt may perish with these 2004, an apparatus started to take use to re s e a rchers outside EBHRC men. Indeed for an administrator or shape. The learn i n g - b y - d o i n g looked bleak. 8 FROM OUR ARCHIVES

It is a matter of language. Wr i t t e n of its contents. This empowering of the adaptation to the realities of working in (fusha aka classical) and spoken interviewees makes the final written Egypt has led to one whose advan- Arabic in Egypt are drastically differ- transcript the definitive document that tages are not limited to evasion of ent. The language of Egyptian dailies is later made available for researchers. authoritarian constraints on academic and popular fiction does integrate col- research. Indeed its principle advan- loquialisms, but the amalgam tilts This was a watershed moment of sorts. tage as a method designed for the strongly in favor of the written Arabic The fact that interviewees review and landscape in which it is put to use is and is weighted arbitrarily by the writer. sign off on the final transcript meant that it prompts a reappraisal of so- Surprisingly, the solution to this local, that the final transcript could be writ- called universal practices that may culturally specific problem was inspired ten in fusha and the ideas sorted and have otherwise been awkwar d l y by the oral history tradition of an institu- clarified. For all the loss of inflection employed. tion that, as far as we know, has never and tone justifiably predicted by critics collected an account in Arabic. In of this method – even when editing is Contrasts and Intersections January of 2005, the center's director reduced to a utilitarian minimum, the visited Columbia University's Oral presentation of a written transcript to Oral history, when conducted as part History Research Office, an important the interviewee has proved to be an of a project larger than the subject institution in the practice of oral history. incredibly rewarding step. More than interviewed, becomes a study of con- The crux of the Columbia method is the just providing space for an editing and trasts. Crucially, in the oral history that is centrality of the final, written transcript. expansion of their comments, some of the primary activity of EBHRC, and in The oral re c o rding is secondary. the people interviewed were moved profound distinction from history writ- Columbia enables the interviewees to to see their stories treated as text; as ten about a particular institution, the amend a transcript of their documents, historical documents. The transcripts building blocks of history, the life stories to add, edit and delay the publication enable the interviewees to see the of the interviewees, exist independent- fruits of the sessions and the goals of ly as intact historical documents unin- the interviewer. A transcript, which is jured by editing for an a priori estab- presented to the subject after the first lished objective. The overarching goal session, helps guide subsequent ses- maybe the chronicling of economic “...The oral history, sions – the process of transcription crys- and business history of Egypt, but in no tallizes, to the interviewers and the way should such a goal segregate the as conducted by interviewee, what issues raised in the p rofessional experience of intervie- initial meeting would be worthwhile to wees from the rest of their makeup. A EBHRC may be pursue further. Most important however life history must, and indeed does, is the increased level of trust that inter- cover the life and times of an individ- validly critiqued as viewees feel towards the entire ual. Once that re c o rd is extracted process once its fruits are laid before intact, we may then subject it to all a top-down history them. manner of critique and contrast with press clippings and lesser discourses. It inasmuch as those Oral history is, in part, the black market is not that an oral history in the form of that develops when the ceiling on a life history is necessarily a complete interviewed are access is set below the standards of or exceptionally truthful document – scholarship, which has sullied its repu- but it must be, within the parameters persons nearer the tation somewhat; as a last resort, a set by the life history format – whole poor man's history. This is a trivial read- before it is put to a service of a more center of things, ing of the method. Whether it provides narrowly defined objective. The oral the central pathway to political, eco- history, as conducted by EBHRC may but any history nomic and business institutions of a be validly critiqued as a top-down his- country, as it does in EBHRC's primary tory inasmuch as those interviewed are oral history project, or it serves as an persons nearer the center of things, but written on the alternative mode, this is a method with any history written on the basis of these unique scope. One need only consider accounts will be history written with the basis of these the question of externalities, patron- building blocks intact - a history written age and other unofficial – if not under- from the ground up. accounts will be ground- dealings to see but one exam- ple of this scope. In their recent work Now we return to the records in the history written with on the development of the Cairo sub- center's archive. Each had been urb of Heliopolis early in 20th century, extracted independently – a fact that the building blocks Dina Khalifa and Lina Attallah link the makes contrast more meaningful, and preponderance of working overlaps more noteworthy. Surveying intact - a history as security guards and janitors in the the records one is struck by overlaps in neighborhood to a promise made by the accounts – the contrasting per- written from the the Belgian industrialist, Baron Edouard spectives and overlapping experi- Empain, to the Bedouns of jobs in ences of some of the major figures in ground up. ...” return for their land. Of this deal there the modern economic history of Egypt. are no official records save the testi- A brief tour of a selection of oral history mony the authors were able to extract. records demonstrates the possibilities The usage of the method may be of how the overlap maybe used to enforced by circumstance – but this construct a history. 9 FROM OUR ARCHIVES

Consider, as a point of departure, the to run the apparatus with substitute narrative of Mohammad Abdel- chemicals that would give the impres- Wahab, whose association with the sion of a functioning spraying mecha- Egyptian industrial experience spans a “...In the literature nism – he followed the order and an period of fifty years from his appoint- entire line of sheet metal was lost. ment as an engineer in military factory of oral history one no. 54 to up until 1993 when his nine- Disillusioned, he left the company and year tenure as Egypt's Minster of finds allusions to the country. After spending time in the Industry came to an end. Abdel- United States and the Arabian Gulf, Wahab described a nation's industrial- the unique suitabil- Taymour returned to Egypt in the early ization that began within the army bar- 1980s armed with an extensive experi- racks where a clear dedication to inde- ity of oral history to ence in fund management - there he pendent innovation led to the manu- set up a financial analysis and interme- facture a wholly Egyptian rifle license the countries of diation company whose influence rose for which was then sold to Iraq in 1959. steadily as economic transformation of For Abdel-Wahab the transfer of military the South where it Egypt towards a market oriented econ- industries to the civilian Ministry of omy became de rigueur. His firm Industry in 1967 was a severe blow to is claimed that received numerous commissions to sector previously dedicated to devel- study the mechanisms of capitalist oping an integrated industrial base. The oral tradition has t r a n s f o rmation including privatization. political considerations and unfocused This was a process to which successive vision led to a public sector becoming been more thor- of Egypt in the 1980s and a misshapen apparatus that was grave- 90s were never commited, preferring ly overstaffed and under e m p l o y e d . oughly embraced postponement to confrontation at any Remedially, Abdel-Wahab was one of price. Never more so, in Taymour's view, the architects of Law no. 203 of 1991 because of the then in the government's wasteful designed to place an "iron curtain" defense of the , justifi- between the government, with its ineffi- absence of institu- able only as political denial of an eco- cient administrative apparatus, and the nomic pressure that the government public sector so that latter could "go as never sought to alleviate. private" without having to be actually tions that provide sold. This rehabilitation of the public The government's protection of the sector he hoped would save it from the raw material for Pound contended Fouad Sultan was a World Bank's incessant pressure to liqui- grave error illustrative of an administra- date. more traditional...” tion forcibly pressed to implement an economic liberalization in which they Muhammad Abdel-Wahab briefly never believed. Sultan, who was headed Al-Nasr Automotive Company always a firm believer in, and persistent there was little evidence of strategy for (1983 – 1984). Adel Gazarin, also an advocate of, economic liberalism, was industrialization. engineer, who was at the helm of that the surprise member of cabinet as emblematic institution from 1968 to the Minister of Tourism and Civil Aviation Mohamad Elwi Taymour, chairman of early 1980s seconded Abdel-Wahab's from 1985 to 1993 when he was brought EFG-Hermes, Egypt's leading fund and charge that the administration of the over from a career in banking at the portfolio company and investment Egyptian public sector was politically National Bank of Egypt and the bank shared Gazarin's disenchantment distorted. For Gazarin, the automotive International Monetary Fund to head with the politicization of public sector industry was an illustration of a whole what he was told was the "least distort- administration in the 1960s. Ta y m o u r industrial process that was wro n g l y ed sector in the Egyptian economy." had also passed through Al-Nasr aimed at complete import substitution. Sultan had been allowed to write in Automotive Company. His stay there He was particularly critical of the advocacy of economic liberalism in the was brief, but the effect it had on him famous Nasserist era claim that Egypt state owned press at the dawn of was decisive. An eager young gradu- would eventually build everything from Anwar El-Sadat's presidency. He was ate in 1963, Taymour pressed his brother "the needle to the rocket" which he felt writing from his turf in the where in law, the influential nationalist writer led to politically motivated investment he was the IMF representative at the Mohamad Hassanien Hiekal to have which valued the symbolic above the Central Bank of Yemen. His inclusion in him placed at Al-Nasr, then a symbol of practical and the politically saleable the same cabinet as Mohammad the nation's industrial birth. He was criti- above the economically efficient – Abdel-Wahab, over roughly the same cal of what he described as a rampant which at Al-Nasr Automotive was mani- time span, suggests a level political dis- p redilection towards political rather fested in the bias towards passenger order that bordered on the chaotic. than economic or technical considera- cars. Though an advocate of the pri- Whilst Abdel-Wahab was attempting to tions in production. He cited one inci- vate sector, Gezarin refused to support rehabilitate the public sector, he was dent where the factory's painting the so-called "Open Door Policy" insti- advocating its dismantlement. Sultan apparatus was permanently damaged tuted by President Anwar El-Sadat in claims that the cabinet never held gen- because of an order to spray the sheet 1974 – there he saw no sign of a frame- eral policy meetings and that he pro- metal in spite of the fact that the chem- work in which the private sector could ceeded to privatize several hotels not ical components of the paint had yet to play a role in industrialization - then rel- as part of an organized policy, but sim- arrive from Italy. The administrators, in egated to a secondary role in favor of ply because he was never questioned lieu of a visit by a Belgian industrial more commercial activities. In the 1970s about his decision to do so. expert to the factory, ordered Taymour 10 FROM OUR ARCHIVES

towards a market orientation be greet- ly refuted the popularly held belief that “...Abdel-Wahab ed with hostility. Indeed a review of the the nationalization of the Suez Canal press from 1985 to 1993 reveals that the was an emotional act fueled by was one of the Minister of Tourism and Aviation had nationalistic fervor. There were three indeed become a hate figure for all separate committees convened well architects of Law those suspicious of the government's before the decision was finally made stated aims of economic liberalization. to consider the technical, legal and no. 203 of 1991 The reaction to Sultan may have result- financial ramifications of nationaliza- ed in what Mohamad Ta y m o u r tion. In contrast, the rule of Anwar El- designed to place described as a paralysis of a govern- Sadat, wherein Abdullah was general- ment unable, or unwilling, to pay the ly spared prison and appointed as an "iron curtain" political cost of full capitalist transfor- Minister of Planning besides – from 1971 mation. Taymour likened the Egyptian to 1975, when he resigned – there was between the government policy in the 1990s to an a great ideological drive to dismantle, aloof man sitting in bathtub where the starve of funds and atrophy the public government, with temperature is rising incrementally – sector. It was an overwhelmingly nega- one moment is never drastically worse tive policy designed to tear down pub- its inefficient than what had come before. In the lic enterprise without providing an end the man finds himself burned all alternative strategy for industrialization administrative the same. – a that, with the demise of the pre-revolutionary bourgeoisie, was apparatus, and The politicization of industrialization to be built without capitalists. was never in question for another the public sector economist, the remarkable Ismail Sabri 1. Samuel, Raphael. "Perils of the transcript." Abdullah. Abdullah currently chairs the in The Oral History Reader, edited by Robert so that the latter Third World Forum and is widely regard- Perks and Alistair Thomson, ; New ed, across the ideological spectrum, as York : Routledge, 1998: P 389 one of the country's foremost intellec- could "go as 2. Ibid. tuals. It is in this capacity, as an expert, private" without that he sought to participate in the oral history project. His reluctance to delve MESA PANEL—NOVEMBER 20, 2006 having to be into an extensive autobiography could Egyptian Business History: New not curtail interest in his own journey: In Sources, New Methods and New the post-revolutionary era of the 1950s, Directions in Research actually sold. This Abdullah, then a left wing activist, was subjected to severe intimidation and Organized by Roger Owen, rehabilitation of frequent arrest – subjugation that was Harvard University curiously and intermittently interrupted the public sector by Abdullah providing pro f e s s i o n a l Chair: Roger Owen, advice on development and industrial- Harvard University he hoped would ization to Gamal AbdelNasser, in per- Discussant: AbdelAziz EzzelArab, save it from the son. In between non-judicially sanc- American University in Cairo tioned prison terms Abdullah headed Robert J. Vitalis, World Bank's the Economic and Financial Division of University of Pennsylvania the Economic Development Captive Narratives: On the History of incessant pressure Organization (EDO) in 1957, which, at Firms and States in the Middle East the time, was the principle planning (and Beyond) apparatus of the regime and was to liquidate. ...” responsible of surveying the economy Karim Mostafa El-Sayed and collecting information – a pre-req- and Dina Waked, The great discrepancy in policy on uisite for considered central planning. American University in Cairo part of government, and the regime Abdullah had seen in the Egyptian mil- Café Riche: In Pursuit of a Non- responsible for its appointment, was, to itary a progressive class that was com- Quantitative Business Model: Sultan -who claims to be an apolitical mitted to transforming the country and Implications of Macro Changes for advocate of economic liberalism who in doing so transform the coup of 1952 Small Eateries in Downtown Cairo was never interested in political liberal- into a revolution. In contrast to military Dina Khalifa Hussein ism - a simple failure of will. The contra- service in Latin America, a necessary and Lina Atallah, dictions could bare no political read- stage in the life of young aristocratic American University in Cairo ing. heir, the Egyptian army was shunned A Brave New City! Heliopolis: Place, The economist Heba Handousa did by the landowning elites and Business and People offer a political reading. Sultan, she embraced by classes who would oth- Mostafa Hany Hefny, contended, was a test case by the erwise have had no access to educa- American University in Cairo regime. His appointment to lead a sec- tion. It was a core of military engineers The Business History Voyager: Revisiting tor that Sultan himself conceded was who first led the move towards the Western Methods in the Light of Oral relatively undistorted by public admin- industrialization of Egypt. History Accounts of Egypt's Industrial istration was, in part, a signal of intent. Experience Sultan would also bear the brunt of For Abdullah, Gamal AbdelNasser was public criticism should the inclination a deeply pragmatic leader. He strong- 11 INTERVIEW When Firms and Entrepreneurs Cross Borders Professor Geoffrey Jones Shares his Experience with Business History

Dina Khalifa Hussein, Project Officer, EBHRC

n Cambridge, Massachusetts I started in Cambridge in the history important theme in my work. At LSE I stands one of the most prestigious department, where business history was transitioned from oil to thinking more universities in the United States and taught in the context of economic histo- generally about why companies in all the world today. Harvard Business ry, and history more generally. It was industries crossed borders, and their School (HBS) poses in glamour as there that I first encountered the work of impact. I did my first work on multina- Ione of Harvard’s most sought after Mira Wilkins on international business. I tional companies at this time. I also schools. If the American empire today had begun my doctoral research on the undertook my first commissioned com- rests on business foundation, then defi- topic of the history of the oil industry. A pany history, when HSBC asked me to nitely the Harvard MBA graduates are its former head of British naval intelligence write a study of the history of their affili- f u t u re leaders. An interview with told me that there was a very interesting ate The British Bank of the Middle East, Professor Geoffrey Jones, one of the story about the British government and which had originated as the Imperial most prominent scholars of business his- its creation of the national oil company, Bank of Persia. The resulting two-volume tory, unveils puzzling questions in the which we now call British Petroleum (BP). study enabled me to go deep inside the field. Due to his generous invitation, we He was thinking that I would look at it history of a banking institution, as I was sat for an hour in his office in HBS last from a political point of view. I actually given privileged access to that bank’s November and explored various ques- got more interested in the companies confidential archives. tions such as: what is business history? themselves. So my initial work in business What are the big questions posed history was focused on issues surround- University of Reading: through business history? What is the ing the relationship between govern- Conceptual Thinking impact of multinationals on host coun- ment and industry. I remain interested in tries? How does studying business history this research area, although it has not In the late 1980s I moved to the change the outlook of MBA students been the focus of my work for a long University of Reading’s Economics and business practitioners? These are time. Government is very important in Department, then as now a leading only few questions that came up in a business, so you cannot really get a world center for the study of the multi- rich interview that manifests scholars’ sense of business history, without talking national enterprise. I experienced a dif- endeavors of understanding the world, about governments. f e rent set of intellectual influences. in this case, through looking closer at Suddenly, I had no students who had business entities and entrepreneurs who London School of Economics: the remotest interest in history, so I was cross borders, impact cultures, and cre- Comparative Studies and Multinationals obliged to consider new ways of teach- ate markets that shape the world’s eco- ing business history. I developed a whole nomic map. After some years at Cambridge, I decid- new course on the history of internation- ed to move to London School of al businesses. I started to explore ways of Economics (LSE), where a new unit had moving in the classroom between past EBHRC crew: Could you give us an been established to study business histo- historical experiences and the present overview of your encounter with busi- ry, funded primarily by business. At LSE day concerns of students in economics ness history and your intellectual devel- my interest in comparative studies grew and management. opment? because I had to teach a course on the The intellectual environment at Reading economic history of Russia, and had a significant impact on my work. It Prof. Jones: Japan. This made me think of the role of has a long tradition and strength in inter- Cambridge University: Government and e n t re p reneurs and investment flows national business, and a cluster of econ- Industry across borders, and this has been an omists who focused on transaction cost

12 INTERVIEW

economics. The group included Mark as why women could not rise up the of such a book originated through my Casson, a pioneer in applying transac- hierarchies of this type of large compa- work on Unilever. Unilever began to tion cost economics to studying multi- nies. More o v e r, the Unilever history consider diversifying from its traditional nationals, and who later wrote an out- made me think more systematically soap and margarine business into per- standing book on the economic theo- about organization and inform a t i o n sonal care from the 1950s, although it ry of the entrepreneur. So, within this flows within companies. All these issues was only in the 1980s that a series of e n v i ronment, my work started to definitely expanded my own research acquisitions made this wish a reality. In become more conceptual, even if it agenda. Today they feature highly in studying Unilever’s strategy, I discov- remained fundamentally Chandlerian my on-going research agenda. ered how little serious business literature in its empirical nature. I became more existed in the beauty industry, as well inclined to search for generalizations as its extraordinary growth and size and general patterns in the evolution after World War 2. HBS is proving an of business. It was in this environment “... Government is idea base to undertake work on the that I turned my detailed study of one beauty industry. I have already done bank into a general study of British very important in two HBS cases on the French beauty multinational banking over 150 years. company, L’Oréal and Shiseido, the In the resulting book, B r i t i s h business, so you Japanese beauty company. In both Multinational Banking 1830-1990, pub- cases senior executives of those firms lished in 1993, I used a variety of theo- cannot really get a have collaborated closely with me. I retical concepts including, transaction hope in time to write a book on this cost and agency theory to try to sense of business global industry since 1945. understand historical patterns. history, without talk- In most of my previous research, I was At Reading, I also organized a series of trying to understand the why question, conferences, where I put together the- ing about why do companies go international? orists and historians. The aim was to Then I spent quite a bit of time on the encourage the historians to stand governments...” how question, how did they organize away from individual details towards themselves? While exploring this issue, it searching for more general pictures. I Harvard Business School: MBA students, was brought home to me that while also wanted to challenge theorists to business history and the beauty book the U.S. has been frequently used as look at what actually happened, and the benchmark for org a n i z a t i o n a l the contingency of what did happen To w a rds the end of the 1990s, I e ffectiveness, historically there have in the specific environments. I held received a call inviting me to visit HBS. been multiple ways in which firm s conferences on branding and market- After two years as a visitor, I accepted organized themselves, some of which ing, multinational banking and interna- a permanent appointment in 2002. At worked extremely efficiently on quite tional trading, all of which followed this HBS, you are faced with a different ‘unAmerican’ lines. format. I developed a pattern in which teaching and writing challenge; how I organized such a conference, which to transmit complex historical process- During my Unilever research, I really would invariably be inter n a t i o n a l l y es to MBA students and to business started to think about the impact of comparative and include theorists, practitioners? This challenge has had a firms crossing borders, and the global- and I would then go on to write a major impact on my work. In 2005 I ization process more generally. With monograph, which used these insights published a wholly revised version of the book on the beauty industry, I am to understand the evolution of a set of my survey of the history of international going to look at how an industry business institutions, such as trading business, published originally as the The moved from being highly fragmented, companies, over time. Evolution of International Business locally and culturally based, into a (1996). The new book, Multinationals global business with a few large global Unilever and Global Capitalism, shows many of players. I am going to look at what that the changes in my approach which means for culture and society, peo- Over the years my research had shifted have resulted in my sojourn at HBS. It ple’s senses and personal identities. In from oil to manufacturing companies, makes more intensive use of concepts, addition, I am going to study entrepre- and then to and trading com- and it is more global in its outlook. I neurial reactions from companies panies. My research on the latter cul- have written new chapters on the based in developing countries. Thus I minated in my Merchants to organization of firms. Finally, there are will not only focus on large western or Multinationals book, published in 2000. also multiple mini case studies scat- Japanese companies globalizing, but The Anglo-Dutch consumer products tered around the text, reflecting the on how Brazilian, Thai or Chinese firms company Unilever happened to own use of the case method at HBS. responded to that, and how they have one of Africa’s largest trading compa- developed their own competitive nies, and by co-incidence as I was My job at HBS has also opened up a advantage. Can they survive or do exploring their history, I was new set of research opportunities. This is global giants wipe them out? approached by Unilever to undertake primarily because HBS is uniquely well a history of their company from the connected in the global business com- In the longer term, I want to write a 1960s. This project, which resulted in munity. As a result, it is possible to study of how much global firms have my Renewing Unilever book published access executives and companies in contributed to the patterns of global in 2005, introduced me to many issues, ways which are not replicable at other wealth and poverty that we have seen which had not featured highly in my institutions. over the last 100-150 years. Thus, my previous work. It took me to corporate focus and interest is heading towards culture and issues of human resource I am now writing a book on globaliza- the question of “impact” of the com- management, and to questions such tion and the beauty industry: The idea panies. 13 INTERVIEW

EBHRC Crew: Was it generally the case multiple regressions can help us under- EBHRC crew: Since you are curre n t l y that business history developed through stand things. In the real world, chaos, teaching business history to MBA stu- historians rather than business studies uncertainty and complexity drive events. dents, what will business history con- academicians? We need methodologies which can tribute to the business practitioners? understand this, not assume them away. Prof. Jones: I have tried to put forward some of these Prof. Jones: Yes, this is usually the case. ideas in a forthcoming article entitled, As I begin the course, I tell the students Fundamentally, business history confronts “Bringing (History) Back into International that business history is not a course where historical evidence and in doing so, it is Business,” in the Journal of International they get a set of tools that is going to important to have professional skills and Business Studies, co-authored by HBS col- make them rich. It is a course that would understanding of historical material and league Tarun Khanna, an economist by change their outlook. My course is on approaches. training. global business history. Many MBA stu- dents have no idea that the world has I think business historians should be good globalized in the 19th century, and then historians. But, I would add that business this global world fell apart and is only historians will only make an impact if they “... I will not only being restored over recent decades. also conceptualize and generalize. That is why I admire Alfred Chandler’s work so focus on large The course challenges students to appre- much. He asks big questions, such as ciate that things change. Globalization what is the relationship between strategy western or was not a linear process. Improved com- and structure or why do firms grow, and munications and transport were no guar- he provides big answers. They can some- Japanese compa- antee of continuous globalization. In times be contested, but they move the turn, the course challenges the students debate on enormously.Therefore, I do to consider if the present global econo- not think the future of business history is to nies globalizing, but my might collapse in due course, and to collect more and more data on individ- use history for signs. What is going on now ual institutions. Such research is of course on how Brazilian, that would signal a reaction to globaliza- an essential building block, but business tion? The students come to realize that historians need to use that information to Thai or Chinese reactions to globalization occur ask big questions. because there are more losers than win- firms responded to ners. As future business leaders, they EBHRC crew: Does the type of question need to make fewer losers and more then differ from a business historian who that, and how they winners in the global economy. has a history background to one who The course highlights the importance of has an economics or business back- have developed ethics in business decisions, and the ground? complexity of making ethical judgments. their own competi- There is a case on multinationals in South Prof. Jones: Africa during apartheid. We look at four Actually, it depends on the business his- tive advantage. such companies, two which divested torian himself. I can think of business his- and two which remained, and look at torians trained as historians who now use Can they survive or both the ethical and commercial impli- standard social science methodologies, cations of their decisions. During class we employ the assumptions of neo-classical do global giants discuss the difficult issue concerning how economics, and exploit large data sets. I evil a government or regime must be can think of people trained as econo- wipe them out?...” before a firm takes the decision to divest, mists who write historical narratives of the and whether such divestment helps or most traditional kind. In other words, pro- hinders the people of a country living fessional training is not a once for all under an awful political regime. Looking experience. However there are certainly at very concrete historical evidence many methodological tensions within the In general I think there are many oppor- brings to the attention of our future busi- discipline. There is a big diff e re n c e tunities for the research of business histo- ness leaders such issues in a highly con- between a social science methodology, rians to reach wider audiences. There crete and vivid fashion. which seeks to test theories on empirical has never been a time when social sci- historical facts, and the classic historical entists have talked more often that ‘his- EBHRC Crew: Since you are interested in methodology, which starts by looking at tory matters’. The job of business histori- the impact question and contextualiza- the evidence and tries to generalize ans and historians generally is to publish tion of business history, there have been from it. research to show why it matters. The views on the separation of the private problem with much business history at and public spheres of business history. Is Issues of Methodology the moment is that the books are too business history apolitical? What do you long, too complex and often not think of the justification to copy business The problem of social sciences is that it focused on a particular issue. There is models in any country, under the banner has a methodology that is rather restric- invaluable empirical re s e a rch which of economic liberalization? tive in nature. Historical methodology is e x p l o res why entre p reneurs succeed, more similar to natural sciences such as why they came from some countries and Prof. Jones: astrology and geology in the sense that it not others, and so on, but it is written in Business history provides much evidence is better able to deal with highly complex such an inaccessible form that even a on the disastrous consequences of trans- situations in a world that is more compli- professional like me cannot really draw ferring management systems from one cated than a one in which the use of out general patterns. country to another. 14 INTERVIEW

There is rich literature on the difficulties of geopolitical system and thought process of countries, all of which are legitimate transferring American management that probably did not facilitate growth in subjects for business history to explore. techniques in Europe after World War 2. developing countries. Management systems are rooted in their EBHRC crew: With the current trend of context, and to seek to transfer whole Local entrepreneurs studying multinationals, how much can packages to other countries is a recipe this tell us about the host country where for failure. We also need to get into issues related to it operates? the local entrepreneurs, their response Business history research on the impact and their background. Where do entre- Prof. Jones: of multinationals shows that it is foolish to preneurs come from and how far does From the perspective of a country that assume that outcomes are always posi- their culture, religion or the social struc- has poor surviving archival information, it tive for host . There can be a ture impact them and what they choose can tell us a lot. In the case of British virtuous circle if the entrepreneurs and to do and not to do? Clearly variations in banks in the Middle East, the archives other business elements in the host com- entrepreneurial skills play a significant contain millions of pages of documents pany respond in a particularly dynamic role in understanding why some coun- on credit transactions of Arabs and way. This virtuous circle involves govern- tries are rich and others are poor. Iranians. The problem, however, is that if ment, the public policy framework, local Unfortunately we still lack convincing you read British colonial re c o rds on entrepreneurs and foreign companies. explanations of the origins of entrepre- Africa, for instance, you will be lead into Foreign companies can transfer knowl- neurship, and the reasons for variations a direction that Africans are hopeless edge and information, but this is useless in its quality. entrepreneurs and that the culture is in a unless there are local entrepreneurs who dire need for the colonial regimes to put respond and a government that pro- things in order. If such material is used, a vides the suitable context. In my MBA lot can be discovered but within the class, we compare the strategies of context of realizing the bias of the India and China. During the 1960s and “... Why are some source. It is not good to write the history 1970s most foreign companies left India. of the country through the eyes of for- This was re g a rded by many as one cultures capable of eign companies in a too literal way. cause of India’s slow , as the country found itself isolated from creating organiza- EBHRC crew: What do you think of rely- international flows of knowledge and ing on oral narratives as a source of writ- technology. Yet this era laid the founda- tions that can ing history? tions for the growth of powerful indige- nous firms such as Tata, which are now exploit knowledge Prof. Jones: becoming globally competitive. India Oral narratives are a great potential has almost no foreign companies and and transform it, source for business history, but they need depends on indigenous entrepreneur- to be used with caution. One has to be ship. In contrast, China is currently hailed while others aware of people’s agendas and the as a great success story due to the large frailty of their memories. You cannot rely amount of foreign direct investment it cannot? ...” solely on oral narratives for dates and has attracted since the 1980s, and it statistics, for instance. Nevertheless, lacks the kind of strong domestic enter- what any historian wants to do is get into prises seen in India. Which is the better the heads of people. Oral history is very model for sustainable economic suc- Evidently societies and their entrepre- good at that, but one has to constantly cess? neurs differed in their abilities to absorb remember that he is in a head of a per- knowledge. The kind of knowledge that son. If people are alive, it is quite irre- EBHRC crew: What can business history was created with industrialization in sponsible to write about something with- contribute to studying the Middle East? w e s t e rn counties from the late eigh- out talking about the people them- teenth century was rapidly diff u s e d selves. Prof. Jones: about northwest Europeans, and the Foreign companies dominated most of colonies they created in North America GEOFFREY JONES IS JOSEPH C. WILSON the economies of the Middle East in ear- and elsewhere, but proved hard to dif- Professor of Business Administration at lier times, but this brought mixed eco- fuse beyond that, with the very signifi- Harvard Business School. He was the direc - nomic results. Foreign firms enabled the cant exception of Japan. The primary tor of the Centre for International Business exploitation of mineral resources, which reason have been the inabilities of many History at Reading University until 2002. He transformed Middle Eastern economies, countries to create the organizational previously taught at Cambridge, London School of Economics and Reading but they captured much of the value forms that could exploit this knowledge Universities in the UK. He is a business histo - created themselves. They were also not to generate wealth. Business history has rian, whose main research interests focus very good at diffusing knowledge to the the potential to answer these funda- on international business and entrepre - local economies. In Egypt, the Suez mental questions about the drivers of neurship, and the impact of multinational Canal Company created an infrastruc- economic growth. What are the barriers firms crossing borders. His publications t u re, but operated in a system that of diffusion of business and technologi- include: British Multinational Banking 1830- restricted locals from rising up the hierar- cal knowledge? Why are some cultures 1990 (1993), Merchants to Multinationals chy. I think foreign companies have capable of creating organizations that (2000), Multinationals and Global Capitalism (2005), and Renewing been and remain important conduits of can exploit knowledge and transform it, Unilever:Transformation and Tradition technology, information and knowl- while others cannot? The answers are (2005) . He is currently working on a history edge, yet the way they structured their evidently to be found in the political sys- of the globalization of the beauty industry. business in the past occurred within a tems, cultures and institutional structures

15 HISTORICAL PERSPECTIVES Eg y p t i a n Textile Wor k e r s in the Transition to a Neo-Liberal Order

Joel Beinin, Professor of Middle East History, Stanford University

rom the mid-1950s to the pres- Nasserist regime and exposed it to sig- ent, despite the nationaliza- nificant political and social criticism for tion of most of the textile the first time since 1954. Since then “... Egypt’s defeat in industry in the early 1960s, the there have been sporadic outbursts of encouragement of private collective action and strikes in response the 1967 Arab- Fenterprise in the mid-1970s, and the to declining real wages in 1971-72 and denationalization of a number of enter- 1975-76, reductions in consumer subsi- Israeli War prises since 1991, one factor has dies and the imposition of Washington remained constant: the state has consensus neo-liberal policies in 1977 undermined attempted to assert full control over all (the January food riots), price increases workplaces of any significance. Trade and increases in workers’ contributions the legitimacy unions have been tightly contro l l e d . to health insurance and pension plans Elections to local union executive com- in 1984-89, and the privatization of the of the Nasserist mittees have often been fixed. In 1987 public sector in the 1990s and early the High Constitutional Court ruled that 2000s. Textile workers in the large pub- regime and the right to strike was constitutionally lic sector mills – the Misr mills in Mahalla protected. But striking workers contin- al-Kubra, Kafr al-Dawwar and Helwan, exposed it ued to risk severe re p re s s i o n . and the ESCO mills in Shubra al- Legislation adopted in 2003 formally Khayma and – were prominent to significant legalized strikes, but under severe l y in all these waves of protest and strike restricted circumstances. Labor news activity along with other public sector political and social has rarely been reported on the radio workers. Private sector workers partici- and television and in the government pated much less active in collective criticism for the first press. In the mid-1980s the legal leftist actions of any sort. weekly, al-Ahali, consistently covered In the mid-1980s several “alter- time since 1954...” labor issues; and for several years in the native” newspapers and organizations early 2000s Al-Ahram Weekly tolerated emerged to give workers a voice out- Mutawalli al-Sha‘rawi were among the more labor news than other govern- side the framework of the state-domi- editors of Sawt al-‘Amil ( Wo r k e r s ’ ment owned newspapers. nated trade union federations, which had long ceased to represent them. Voice), which began publication in 1985. Sawt al-‘Amil sharply criticized Egypt’s defeat in the 1967 Arab-Israeli Veteran textile union activists, the late the historic absorption and repression War undermined the legitimacy of the Taha Sa‘d ‘Uthman and Muhammad

16 HISTORICAL PERSPECTIVES

of the labor movement by the India. A weaver in a well-run private agreement with the IMF and the World Nasserist state. It tried to connect the sector enterprise makes about LE 1,000 Bank. Law 203 of June 1991 was the workers’ movement of the mid-1980s a month (including base pay of about first tangible step towards privatizing with the militant trade union upsurge LE 500-600 plus incentives); a spinner the public sector, which the interna- of the 1940s and early 1950s by pub- makes about LE 800 a month (includ- tional financial institutions had been lishing biographies of veteran activists ing base pay of about LE 400 plus urging for over a decade. After resist- and other historical material. One of incentives). It is, of course, not acci- ing privatization since 1974, the lead- its major projects was a series of arti- dental that the lower paid spinners are ership of the Egyptian Trade Union cles presenting a legal case for the mostly women. Private sector textile Federation endorsed this legislation. innocence of Mustafa Khamis and workers work twelve hour shifts and Several state-owned textile Muhammad al-Baqri – two textile r a rely receive health insurance or firms were sold to Egyptian and for- workers who were executed on other social benefits (whose total cash eign investors during the mid-1990s September 7, 1952 because of their value is about LE 400 a month) despite spurt of private investment. They gen- participation in a strike on August 12- the fact that they are legally entitled erated 12 percent of all pro c e e d s 13 in support of the demand for a to receive these benefits. Wages are from the sale of public sector enter- freely chosen trade union for the work- about half this amount in public sector prises. From 1992 to 2000 the market ers at the Misr plants in Kafr al-Dawwar. enterprises, where daily shifts are 7 share of the private sector in cotton Textile workers at Mahalla al-Kubra hours and workers receive time-and-a spinning grew from 8 percent to 58 f o rmed the core of an are a - w i d e half for overtime (5). Nonetheless, the percent (8). o rganization, al-Fagr (Dawn), which industry is globally uncompetitive. In response to the crisis in spin- had several hundred members and Exports began to decline in 1990, ning and weaving, production of issued a newspaper with the same exacerbated by a global textile reces- ready-made garments became a name in the mid-1980s. Another sion in 1991. The value of total pro- more salient factor in the textile indus- regional newspaper of the period was duction reached the lowest point try. This replicated the practice estab- based among the textile workers of since government statistics began to lished in the late 19th and early 20th Shubra al-Khayma (‘Ummal Shubra al- be collected in 1996/97 (6). centuries, when competition fro m Khayma). The fiercest confrontations The private sector has been imported European cloth led to a between workers and the state during encouraged by the state since Anwar decline in Egyptian spinning and the 1984-89 strike wave were two sit-in al-Sadat’s declaration of an “open weaving, but a sharp rise in garment strikes at the Iron and Steel Co. in door” economic policy in 1974. There production (9). In 2000/01 there were Helwan in July and August 1989 (1). Its was relatively little private investment 209,272 spinning, weaving and dyeing leaders were among the founders of in any industrial sector in the 1970s. workers and 163,241 garment workers the Center for Trade Union and Private sector investment in textiles (compared to 457,191 spinning, weav- Workers’ Services. The Center subse- declined precipitously from 1983 to ing, and dyeing workers in 1976). quently established a branch in 1987. It grew following the 1991 Gulf Private investors are well-represented Shubra al-Khayma whose primary War, but stalled in mid-2000 (7). The in garment production. The value of objective was to serve the textile 1991 Gulf War created the conditions private sector garment pro d u c t i o n workers in the area. After the Iron and for Egypt to sign an Economic Reform i n c reased nearly 30 percent fro m Steel Co. strikes, the regime of Husni and Structural Adjustment Pro g r a m 1996/97 to 2000/01, while the value of Mubarak, became less tolerant of public sector production fell by labor dissidence, an aspect of its gen- approximately the same amount. In erally more repressive character in the “... The pattern of other words, neo-liberal privatization in 1990s. the garment industry did not result in a This revival of labor militancy workers’ collective substantial increase in the value of occurred in the context of a structural total production, nor did it provide crisis of the textile industry concentrat- action since 1971 enough employment opportunities to ed in the public sector. The proportion replace the lost jobs in spinning and of textile workers in the industrial work indicates a weaving. force began declining in 1960; the Moreover, the garment work- absolute number of textile workers significant force is highly feminized, which has began declining in 1976 (2). The index resulted in lower wages, just as was the of real wages of textile workers disparity between case 100 years ago. Of all public sec- declined from 100 in 1986 to 61 in 1994, tor garment workers, 51 percent are an even more precipitous decline the work experi- women; 40 percent of all shirt makers than that of the industrial work force as are women, all in the private sector; a whole (3). Due to lack of capital ence, trade union and 52% of all other private sector gar- investment, productivity in the ment makers are women (10). Egyptian textile industry was actually and political con- P recise information about lower in 1999 than in 1985. It is now working conditions in privately owned much lower than in neighboring coun- sciousness, and textile and garment enterprises is diffi- tries like Tunisia and Turkey. A quarter cult to come by. While they are of the machinery is outdated and militancy of public legally required to provide the same needs to be renovated or replaced (4). social benefits and health insurance Average wages of Egyptian and private sector as public sector firms, most do not. textile workers are among the lowest in They evade the law by bribing inspec- the world: 85 percent of wages in workers...” tors and producing for the local mar- Pakistan and 60 percent of wages in ket, which requires lower standards of

17 HISTORICALSEMINARPERSPECTIVESSERIES

By 1999, 137 of the 314 public END NOTES: “... the garment sector firms declared eligible in 1991 had 1. Omar El Shafei, "Workers, Trade Unions, and been privatized. Although the 1991 pri- the State in Egypt: 1984-1989," Cairo Papers workforce is highly vatization legislation forbade mass lay- in Social Science 18, no. 2 (Summer 1995): 22- offs after privatization of a firm, man- 29, 33-35. 2. Tamer Abdel-Kader, “State, Capital and feminized, which agers of public sector firms under consid- Workers’ Protests in Egypt,” (M.A. thesis, eration for privatization often attempted American University in Cairo, 1998), 79. has resulted in to make them more attractive by reduc- 3. Ibid., 84. ing the workforce before the sale. 4. American Chamber of Commerce in lower wages, just Anxieties about unemployment and Egypt, The Textile and Clothing Industry in other possible consequences of privati- Egypt (Cairo: The Chamber, August 2004), 70. as was the case zation prompted a renewal of strikes and 5. Interview with the owner of a private sec- collective action in the mid-1990s, with tor textile enterprise who wishes to remain anonymous, Cairo, March 19, 2005. major strikes at Misr Fine Spinning and 100 years ago. Of 5. Abdel-Kader, 81; Egypt, Central Agency Weaving in Kafr al-Dawwar in November for Public Mobilization and Statistics, On-Line all public sector 1994 and Misr Helwan Spinning and Census of Industrial Production, 2000/01 Weaving in August 1998. At the Misr “`Adad al-mansha’at wa-`adad al-mush- garment workers, Helwan mill, the entire workforce of 8,700 taghalin hasba fi’at al-sin wa’l-naw`.” was given a three-week vacation. Then 7. Abdel-Kader, 81. 51 percent are management announced that only 8. Jolynn Khamky, "Liberalization to 2,800 workers should re t u rn to work. Divestment: Egypt, 1960-2000," senior honors thesis, Department of History, Stanford Rumors spread that the enterprise would women; 40 percent University, 2003), 50, 65. be leased to a private investor (13). Some 9. John Chalcraft, The Striking Cabbies of of all shirt makers 400 workers of ESCO’s Qalyub Spinning Cairo and Other Stories: Crafts and Guilds in Mill sat in at their enterprise for over four Egypt, 1863-1914 (Albany: State University of months from February to June 2005 New York Press, 2004), 55-58. are women, all in protesting the sale of their firm to a pri- 10. Central Agency for Public Mobilization vate investor because neither the gov- and Statistics, On-Line Census of Industrial the private sector; ernment nor the new owner would com- Production, 2000/01 “‘Adad al-mansha’at wa-‘adad al-mushtaghalin hasba fi’at al-sinn mit to maintaining the level of their and 52% of all other wa’l-naw‘.” wages, benefits, and pensions (14). 11. Interview, Cairo, March 19, 2005. Despite the moves towards pri- 12. Marsha Pripstein Posusney, "Globalization private sector vatization, the textile industry remains the and Labor Protection in Oil-Poor Arab core of the public sector. The single Countries: Racing to the Bottom?" paper pre- garment makers largest state-owned enterprise is the Misr sented at the conference on “The Jordanian Spinning and Weaving Company in Economy in a Changing Environment” are women...” Mahalla. It employed over 20,000 work- (Amman: University of Jordan, July 22-23, 2003). ers in 2000 and generated revenues of LE 13. Agnieszka Paczynska, "Globalization and documentation than the export market. 700.2 million. By contrast, one of the Pressure to Conform: Contesting Labor Law Firms that pay social insurance benefits most successful new private firm s , Reform in Egypt," paper presented at the DC must pay a severance package equal Spinning and We a v i n g , Area Workshop on Contentious Politics to two months wages for every year employed 3,200 workers and earn e d (College Park, MD: University of Maryland, worked if they dismiss a worker. Firms revenues of LE 160.68 million. The recent- October 23, 2002). that successfully avoid paying social ly privatized Arab Polvara Spinning and 14. Joel Beinin, “Popular Social Movements and the Future of Egyptian Politics,” Middle Weaving earned LE 213.52 million (15). insurance benefits are able to fire work- East Report Online, March 10, 2005, ers with no restrictions, a strong incentive The pattern of workers’ collec- http://www.mafhoum.com/press7/231S24.ht for illegal behavior (11). tive action since 1971 indicates a signifi- m Before enactment of the 2003 cant disparity between the work experi- 15. Khamky, "Liberalization to Divestment," 67. Unified Labor Law it was widely reported ence, trade union and political con- that workers signed undated letters of sciousness, and militancy of public and resignation when hired so that they private sector workers. Even among the JOEL BEININ is a professor of Middle East could be dismissed without re c e i v i n g generally more militant public sector tex- History at Stanford University. He taught at severance pay if they “made trouble.” tile workers, gender, locality, the differen- Stanford University since 1983. He was the Firms often hired workers on three-month tial effects of foreign competition, the President of the Middle East Studies temporary contracts and fired them particular commodity manufacture d , Association of North America in 2002. His the fabric worked, and the political char- research interest focuses on workers, before they became permanent. The peasants, and minorities in the modern 2003 legislation legalized indefinitely acter of the local trade union leadership Middle East and on , Palestine, and renewable temporary contracts (12). This all produced important diff e re n c e s . the Arab Israeli conflict. His publications means that many workers remain in Therefore, it is very problematic to define include: Workers on the : Nationalism, limbo for years living in fear of exercising a set of common experiences and a Communism, Islam and the Egyptian their rights and with no job security. consciousness that define “the” Egyptian Working Class, 1882-1954 (1987; co-autho- Several of the new private enterprises textile worker. The entire Egyptian work- red with Zachary Lockman), The are located in the new cities surrounding ing class has been disorganized over the Dispersion of Egyptian Jewry: Culture, last three decades, and the long-term Politics, and the Formation of a Modern Cairo. Workers are therefore cut off from Diaspora (1998). Workers and Peasants in the social networks required to support effects of the efforts to re-privatize the the Modern Middle East (2001.) collective action; few private sector firms economy since 1991 are still not know- are unionized. able.

18 HITORICAL PERSPECTIVES Railroads in the Land of the Nile The Story of Egyptian Railroads

Amr Nasr El-Din, Political Science Graduating Senior, AUC

n a daily basis, around 2.3 The development of railroads in the The British Connection: The million passengers use 19th Century was initially and in most British Interest in a trains operated by the cases dominated by economic fac- Egyptian National tors. Railroads were used to exploit Permanent Route to Asia: Railroads (ENR) to reach natural resources and facilitate exports Otheir destinations. In addition, more and/or imports. It was a general trend, The British were primarily interested in than 11 million tons of freight is trans- especially outside North America and securing an access to their dominions ported on an annual basis (1). Thus it Western Europe, to find major colonial in Asia and creating a safe trading cor- could be fairly said that the ENR plays powers investing in infrastructure proj- ridor to India, the largest and most a major role in Egypt's economic activ- ects, especially railroads, to gain important British colony, or the jewel of ity. This role has been successfully ful- access to natural re s o u rces and/or the British crown, as it was aptly filled by the Egyptian railroad service facilitate penetrating local markets. described at the time. Historically, since it was first created more than 150 This happened in India, China and there were two main routes connect- years ago. other parts of the world (3). ing Europe and Asia: the first was through the Middle East and was main- The creation of Egyptian railroads was In the case of Egypt, the introd u c t i o n , ly a land route passing either through a direct result of the massive changes building and development of railroa d s Egypt or through, what is now known, that took place in Egypt in the early was not intended as a service to the as . This famous land route which years of the 19th century. But despite Egyptian economy or as a means to encompassed the famous Silk Road the long history of the ENR, and the penetrate Egyptian markets, or even rapidly deteriorated in the years follow- vital role it plays in the life of the coun- exploit Egypt's natural res o u r ces; rather, ing 1498, when Vasco Di-Gama discov- try, little is known about this massive it was motivated by the desire of Grea t ered the Cape of Good Hope. This establishment which employs around Britain to gain political leverage in newly discovered naval route allowed 90,000 people and operates a wide Egypt in order to secure and stren g t h e n the British and other European powers network of routes which range from its grip on its main access route to India. easy and unrestricted access to Asia, fast high-density trafficked routes to In pointing this out, I do not mean to avoiding the high tariffs they used to small lazy Delta branch lines (2). Its long un d e r estimate the economic rationale pay to use the old land rout ( 4 ). and interesting history is virtually behind the construction of railroa d s , M o re o v e r, the new route, though unknown to most Egyptians. This piece but rather to highlight the presence of much longer, was much safer than the is concerned with the history of the other factors that, in some cases, old one, which was prone to political Egyptian railroads and investigates the played a decisive role reg a r ding rail- upheavals that could drastically affect reasons why railroads were introduced road development in Egypt. its accessibility. in Egypt in the first place. 19 HITORICAL PERSPECTIVES

The New The route passing through Egypt pos- i m p roved security throughout Egypt sessed a clear advantage over both and made the Western powers, and Middle Eastern Route: the Cape of Good Hope and Britain in particular, more intere s t e d Mesopotamian routes since it required than ever in benefiting from Egypt's The expansion of British and European less time to cover. At the time sea trav- unique geographical position to secure influence in Asia and their subsequent el was cheaper and faster than land a permanent route to their Asian and e n t renchment in their new colonies transportation, and the Egyptian route African colonies. automatically transferred Euro p e a n entailed carrying goods between the conflicts and rivalry to the Asian hinter- harbors of Alexandria and Suez – a dis- Renewed British Efforts to lands. This required a faster means of tance much shorter and safer than communication to transmit orders as crossing the Mesopotamian desert. The Re-Open the Egyptian Route: evidenced by a report written by time factor was soon recognized by the Colonel James Capper of the East British; in a report by Capper he says: Britain's renewed interest in Egypt and India Company around 1738 in which “when the peace [referring to the its desire to establish a faster link he says: “during the late war in India, peace treaty between England and between England and its colonies in we frequently, had no intelligence from Spain] was signed, the news of it was the Indian sub-continent is attested to England for eight to nine months; nor transmitted to India, both across the by a memorandum sent by John Barker did we hear of the rupture of Spain until g reat desert [of Mesopotamia] and in 1815, the British Counsel General in upwards of eleven months”(5). In addi- also round the Cape of Good Hope. Egypt between 1828-1833, in which he tion, the ships used to maintain contact Nevertheless it did not reach Madras suggested using steam ships in the between Europe and Asia urg e n t l y until the end of June… [H]ad the pas- Mediterranean and the to cre- needed massive re-supply stations sage through Suez been available at ate a faster link. In addition, a report along the naval route, which entailed the time the dispatch might have been written in 1829 by lieutenant Thomas huge economic and political costs. sent from England to the scene of Waghorn of the Bombay Marine stated These two factors highlighted the need action in 70 days”. that a trip between London and for a much faster route to reduce the Bombay could take between five to time and the number of supply stations In 1768, and again in 1775, Capper eight months under sail and up to three needed. came to Cairo in an effort to negotiate months with steam ships through the a treaty with Mohamed Abu Al-Dahab Cape of Good Hope (8). In contrast, a At the time, the main alternative to the that would open the “Sacred Sea” – trip through Egypt, using what was then Cape of Good Hope was the Middle the Red Sea – to British ships in return for known as the “overland route”, could East which was becoming more favor- 200,000 pounds paid to the Egyptian take only 40 days, even without the use able not only on account of the time government per annum in the form of of steam ships (9). factor, but also because the crumbling duties. The Ottoman protest against the Ottoman empire posed a lighter threat treaty forced the British ships to stop One could there f o re conclude that to the European powers. In the Middle three main reasons led the British and coming to Suez from 1779 (6). East there were two main routes to other western powers to favour the access the Far East; the first was by Sea, In 1794, George Baldwin, the upholder Egyptian route. First, Mohammed Ali's to what is now known as Syria, then of British interests in Egypt, managed to reforms, particularly the introduction of t h rough desert caravans to the hold a new treaty with Mourad Bey and new technologies, like the use of Ottoman provinces Baghdad and Ibrahim Bey. This gave British ships the steam-powered vessels in the Nile in Basra, up the Euphrates, then by ships right of free navigation, landing and the 1830s with all associated advan- through the Persian Gulf to India and transit of goods, mails and passengers tages. Second, the increased safety of the Far East. and was later endorsed by a faraman Egyptian trade routes as the govern- (official decree) issued by the Ottoman ment's policing abilities improved (10). The Egyptian Option: sultan. Four years later, however, this Third, the fact that the Egyptian route was disrupted by the French invasion to required much lesser time than its alter- Transiting Through Suez: natives since the distance was much Egypt in 1798 (7). shorter. The second Middle Eastern route was a c ross the Mediterranean, thro u g h The Creation of the Modern At the time the Egyptian route consist- Egypt to the Red Sea. It was a very old State: Mohammed Ali and ed of two main sections. The first started route, which dated to the time of the the Pillars of Modernization: in Alexandria where the commodities Pharaohs. Historically, this route used to coming from Europe were unloaded at pass through the city of Pithon, better its port, to be loaded onto small vessels known as Heroopolis, at the Gulf of It is often said that the founding of the modern Egyptian state and, therefore, which sailed through the Mahmoudiya Heroopolis, before it dried and retreat- canal, dug in 1819, then through the ed to today's city of Suez, which was the beginning of the modern history of Egypt dates back to the reign of Nile to Cairo. The 269 kilometres long connected to the Pelusiac Nile, one of trip took three to four days or accord- the many Nile branches that, also, Mohammed Ali (1805-1848). The pow- erful government institutions, backed ing to some sources 42 hours of day dried out. It was repaired and used in navigation to end its journey at the port Greek and Roman times, during the era by a powerful economic base that rest- ed upon advanced industries and a in Bulaq. Commodities, mail and pas- of Ptolemy and Trojan re s p e c t i v e l y . sengers were then moved on to Suez Later on, after the Islamic conquest, it flourishing agriculture, created by Mohammed Ali ensured that the gov- by desert caravans, which in fair gained importance not only as a trade weather covered the 144 kilometres route between Europe and Asia, but e rnment had sufficient financial distance in 16 to 18 hours (11). also as a passage to the Hejaz used resources, which, in turn, guaranteed annually by pilgrims heading for the spread of its control over Egypt. Mecca. I n c reased government contro l 20 HITORICAL PERSPECTIVES

Time for Railroading: The First ensure the improvement of the over- of ficial manner by 1835. Interes t i n g l y land route to India, but would, in addi- John Galloway, the brother of Thomas Trails to Establish a Railroad tion, bring about a direct British involve- Galloway, re- o ff e r ed the rail link proj e c t in Egypt: ment in Egyptian affairs which, if well in 1843 to Mohammed Ali who refused it used, could be translated into political once more and on very much the same The above-mentioned facts encour- leverage. The British keenness to manip- gr ounds as before. aged the British to think seriously about ulate the Egyptian railroad project for establishing a fast land link to connect political interests was further sharpened It could be assumed that Mohammed the two naval hubs in Alexandria and by their fear that the French, who at the Ali refused to build the railroad for its Suez. Building a railroad seemed an time were heavily lobbying with possible political and economic conse- ideal solution, especially since the Mohammed Ali to approve their idea quences; but it is equally probable that Egyptian government would gain rev- of digging a canal between the Red he realized that Egypt did not rea l l y enues from the duties on transshipment. Sea and the Mediterranean, were need a new, fancy and expensive There is disagreement among historians gaining political influence in Egypt. means of transportation. Yes, transporta- as to who first presented the idea. tion has always rep r esented a major his- Some sources suggest it was a British The False Start: End of the torical challenge to humans and the f i rm, others, that it was Thomas ease of transportation has always been Galloway, a British engineer of Scottish First Trials to Construct a unanimously identified with develop- origins who used to work for Railroad in Egypt: ment and prosperity. Mohammed Ali (12). In November 1834 Mohammed Ali Egypt is no exception; and its economic The massive project began in 1834, less approved the construction of Egypt's history is very much related to the histo- than 10 years after the inauguration of first railroad and sent Thomas Galloway ry and development of its local and the first railroad in Britain between to Great Britain to purchase the essen- i n t e rnational transportation systems. Stockton and Darlington. The first stage tial equipment. By the end of the year Egypt's geography and topography was a 128- k i l o m e t e r , single-track railroa d most of the equipment, including the played a major role in determining the on the land section of the “overland tracks, had arrived to Alexandria only pa t t e r ns of life and economic activities route” between Cairo and Suez. The dis- to be left in the their crates (14). The ruler of Egyptians. Egypt, or, to be prec i s e , tance would be covered in 6 hours, as of Egypt had suddenly decided to drop the inhabited part of Egypt, is concen- trains then could only run at a speed of the project. A set of political debacles trated round the Nile, in its valley and 20 to 24 kilometers per hour (13). and fear of foreign intervention are Delta. Most of this area is flat grou n d , believed to have made him change his which allows easy overland movement. Railroads as Means of mind and put an end to this ambitious In addition, the dependence of Egypt project before it even started. on the Nile for water dictated, by Political Influence: default, that most of its economic and The fear of foreign intervention, political urban centers and agricultural land had The railroad project received huge or economic, could be partially to be on or near the Nile's waterfro n t . backing from the British government explained by the high cost of the proj- since it meant less transit time and ect, which would have forced Egypt to These factors, plus the navigability of the increased security on its main trading resort to foreign capital. Mohammed ri v e r , greatly facilitated transportation in route to India. Moreover, all the essen- Ali decided it was better and cheaper Egypt. For thousands of years, the Nile tial equipment and experts would to concentrate on digging irrigation was Egypt's main transportation hub come from Britain and it was automati- canals, since they could be dug using and carried people as well as all kinds of local expertise and with minimal costs. commodities, ranging from small bun- “...The railroad They would also be useful both for irri- dles of wheat to the massive obelisks. gation and transportation. Meanwhile, While the Nile and its branches prov i d e d project received the equipment that was shipped to Egypt with an excellent internal trans- Alexandria was used to build small rail- portation system, most of its meager huge backing road lines on which the carriages were in t e r national trade, or, more prec i s e l y , horse-drawn. interaction with the outside world was from the British conducted through desert caravans or The first of these lines was near the now la r ge sea vessels (1 6 ) . It should be said government since famous Cairo suburb of Maadi; the that the Egyptian railroads during their short line used to run between the large fi r s t days did not attract a large per- quarries and a small dock on the Nile centage of Egypt's internal transporta- it meant less transit wa t e rf r ont. It was used to transport roc k s tion either in the form of passengers or in needed for the construction of barrages the form of goods as many pref e r re d time and and other irrigation projects. the Nile as a safer and more accessible The second line was in Alexandria and means of transportation. increased security ran between El-Dekhla quarries and the Alexandria harbor. Like its twin line, this In other words, internal transportation in on its main trading one was also used to transfer rocks and Egypt had always been adequate for its building material needed for the expan- needs and never constituted a major route to India...” sion of Egypt's main port in Alexandria. obstacle to economic development. At Another short line was built to connect the time the railroad project was pro- cally assumed that Mohammed Ali granaries in Alexandria with the port; 30 posed, Egypt did not have a major would resort to British capital to finance small carriages were used on it (1 5 ) . transportation problem. This probably this massive project. An Egyptian rail- Egypt, theref o r e, entered the age of rail- played a role in Mohammed Ali's dece- road built by Britain would not only roading in a de-facto rather than in an sion to turn down the railorad 21 HITORICAL PERSPECTIVES

offer twice. It would be more than 20 example in the history of international years before efforts to build a railroad in railway development in which the Egypt were launched again. desires and interests of a foreign power dominated the pattern of railro a d The Start: The Beginning of establishment and development.

the Railroading Era in Egypt: END NOTES: 1. Gary Goldfish. Steel in the Sand, the The British efforts to convince Egyptian History of Egypt and its Railways: D o r s e t rulers to build railroads continued, and Press, 2003. with accession of Abbas to the 2. Ibid. Egyptian throne, a new and more vig- 3. Danial Thorner. "The Pattern of Railway orous campaign to convince him to Development in India." The Far Eastern Quarterly 14, no. 2 (1955): 201-216. a p p rove the project was launched. 4. A.F.C De Cosson. "History of the Egyptian Unlike its predecessors, this attempt Overland Route." The Egyptian State Passenger station, Egypt, Mass., July 9, succeeded, partly due to British efforts Railroads Magazine 1, no. 2 (1934). 1955. Charles B. Gunn Collection (1988- to help Abbas overcome the 5. Ibid. 0001.ph2139). Courtesy of Ottaman's refusal to his accession to 6. A.F.C De Cosson. "History of the Egyptian railroads.uconn.edu/. ../ma/egypt.htm Egypt's throne. Overland Route." The Egyptian State Rialroads Magazine 1, no. 2 (1934). In November 1851, the contract to 7. Ibid. 8. A.F.C De Cosson. "History of the Egyptian build the first railroad in Egypt was Overland Route." The Egyptian State signed between Egypt's forigen minis- Rialroads Magazine 1, no. 2 (1934). ter, Stephen Bek, and a representative 9. Ibid. of Robert Stephonson, the son of 10. Gary Goldfinch. Steel in the Sand, the George Stephonson, the inventor of History of Egypt and its Railways: Dorset the railroads. It would be a single line Press, 2003. from Alexandria to Cairo, then from 11. Sikak Hadid Masr Fi 125 Aamn 1852-1977 Cairo to Suez, following the footsteps of (Egyptian Railways in 125 Year 1852-1977): Egyptian Railways Press, 1977. See also Gary the old famous overland route (17). In Goldfinch. Steel in the Sand, the History of April 1853, the first section, 105 kilome- Egypt and its Railways: Dorset Press, 2003. p. 3. The Egypt-Suez Railroad Station (Published tres long, between Alexandria and Kafr 12. Fatma Alam Al-Din. Tatur Al-Nakal Ua Al- by Arougheti Brothers) (Unused Postcard, Al-Eies on the western bank of the Nile, Muaslat Al-Dakhelya Fi Masr Fi Ahd Al-Ihtlal Undivided back). Courtesy of www.post - was opened (18). Al-Biritani 1882-1914 (Development of cardman.net/ egypt_suez.html I n t e rnal Transportation System in Egypt The first line between Cairo and under the British Occupation 1882-1914): Al- Alexandria was completed in 1855 with Haiea Al-Masrya Al-Ama Lil-Kitab (General Egyptian Book Organization), 1989. See Also the total cost of one and a half million Sikak Hadid Masr Fi 125 Aamn 1852-1977 Egyptian pounds including the price of (Egyptian Railways in 125 Year 1852-1977): the tracks, flanges, locomotives and Egyptian Railways Press, 1977. carriages. The second line between 13. Sikak Hadid Masr Fi 125 Aamn 1852-1977 Cairo and Suez was built between 1856 (Egyptian Railways in 125 Year 1852-1977): and 1858 and upon its completion a Egyptian Railways Press, 1977. modern railroad line now served the 14. Sikak Hadid Masr Fi 125 Aamn 1852-1977 overland route and its revenues helped (Egyptian Railways in 125 Year 1852-1977): Egyptian Railways Press, 1977. p. 10. the finances of the Egyptian state. It 15. Fatma Alam Al-Din. Tatur Al-Nakal Ua Al- should be said that in 1869 and after The first Egyptian locomotive built by Muaslat Al-Dakhelya Fi Masr Fi Ahd Al-Ihtlal Robert Stevenson and delivered in 1852 the opening of the Suez Canal, the rev- Al-Biritani 1882-1914 (Development of and it was used mainly for haling passen - enues coming from the “steel” over- I n t e rnal Transportation System in Egypt ger trains. Courtesy of www.geocities. land route declined and Cairo - S u e z under the British Occupation 1882-1914): Al- com/ amrsmodelrailroad/ha.html railroad was closed. Consequently, the Haiea Al-Masrya Al-Ama Lil-Kitab (General number of foreign passengers per kilo- Egyptian Book Organization), 1989. p.39. m e t re using the Egyptian railr o a d s 16. Goghrafya Al-Nakal Fi Masr (Geography of Transportation in Egypt). Dirsat Fi decreased to only 14 (19). Goghrafya Misr (Studies in the ): Maktaba Al-Anglo Al-Masria (The Britain's interest in creating and main- Anglo-Egyptian Library), 1987. taining a link with its colonies in Asia 17. Fatma Alam Al-Din. Tatur Al-Nakal Ua Al- was behind the building of the first rail- Muaslat Al-Dakhelya Fi Masr Fi Ahd Al-Ihtlal road line in Egypt. At that time, due to Al-Biritani 1882-1914 (Development of its special geographic and topograph- I n t e rnal Transportation System in Egypt ic circumstances, and notwithstanding under the British Occupation 1882-1914): Al- Haiea Al-Masrya Al-Ama Lil-Kitab (General all the benefits a railroad could bring, Egyptian Book Organization), 1989. p. 42. Egypt had no great or urgent need for 18. Sikak Hadid Masr Fi 125 Aamn 1852-1977 one. It was built not to address the (Egyptian Railways in 125 Year 1852-1977): The Cairo Railway station. Courtesy of social and economic needs of Egypt, Egyptian Railways Press, 1977. www.gasolinealleyantiques.com/ but because a foreign power, namely 19. Ali Basha Mubarak. Al-Kohtat Al- trains.htm Great Britain, decided that it was in her Tawfikiya Al-Gadida (the New Ta w i f k i y a interest to have it built. The story of the Plans). 7 vols. Vol. 7. Egyptian railways presents a clear 22 HITORICAL PERSPECTIVES The Nurturing of Wealth The First Call for a National Bank in Egypt, 1879

Abdelaziz Ezzelarab, Associate Professor of Economics, AUC and Director, EBHRC

n April 1879, a group of Egypt’s “Inma’ al-Mal” knew that public sub- control over Egypt’s finances and gov- social and political elite joined scription in a joint stock company was ernment to European powers, while cur- ranks to issue a communiqué (or, an unorthodox business practice. tailing the power of the ruler (Khedive using the Arabic term, a manshur) Consequently, they had to address this Ismail). This trend was briefly interrupted calling on the public to subscribe practice in principle and apply an arse- in April 1879 when a National Front was Ito a joint stock bank for which they pro- nal of arguments to impress on the pub- f o rmed of a broad alliance of elite posed the name al-Bank al-Watani al- lic its legitimacy, viability, and historic domestic forces, led by large landhold- Misri (The National Egyptian Bank). This is promise. We find a mix of all this in the ers, many of whom were senior state offi - the earliest traceable call on the manshur (see the complete text and cials or MPs. The Front produced a Egyptian public to found a joint-stock translation below). In what follows, I will National Program (“al-La’ihah al- national bank. It may also be the earliest attempt a basic reading of the main Wataniyyah”) which was a package- call on Egyptians for public subscription lines of argument in this document, and pr oposal in which domestic elites under- to any business venture, as the text of this I will use ‘manshur’ and ‘Inma’ al-Mal’ took to liquidate the debt within a frame- manshur strongly indicates. This docu- interchangeably to refer to it. work of political restructuring that ment appeared in the Egyptian daily al- involved sharing power with the Khedive. Tijarah under the title “Inma’ al-Mal” (The Our analysis should begin by a look into Subsequently, a new cabinet took offi c e Nurturing of Wealth) (1). the immediate context. This was a power under Sharif Pasha, a veteran statesman struggle over the control of Egypt’s and a leading signatory to the National The status of Inma’ al-Mal, as one of the finances and government that originat- Pr ogram, and a brief interlude followed earliest public subscription calls, would ed in the public debt crisis of the late during which the cabinet strived to fulfill alone give it a historic importance. What 1870s. April 1879 could be situated within the program. Within three months, this I find very striking, however, is the way it a phase of Egyptian public debt history, attempt collapsed, European powers is imbued in an ideological discourse which started when interest payments took over again, and the Liquidation that draws a connection between busi- were postponed for the first time (April Law was promulgated with debt settle- ness organization, economic progress, 1876), and ended with the promulgation ment principles acceptable to European and global political domination and of the Liquidation Law (July 1880). The powers. It was in the earlier days of that makes of the project a national, reli- dominant issue at that time was negoti- interruption of foreign control in April gious, and historic duty all at once. Not ating a plan for debt settlement, and the 1879, within days of the National very surprising, though. The issuers of general trend was one of transferring Program, that “Inma’ al-Mal” was issued. 23 HITORICAL PERSPECTIVES

We can trace three general strategies paragraphs 1 and 3)—in other words, an followed in the manshur in arguing for a obligation of nurturing natural wealth. joint stock national bank. The first is “...The joint-stock Here, the significance of the title they based on the historical re c o rd of chose for their manshur becomes evi- Europe. In this line of reasoning, Wester n model is thus dent. Proper fulfillment of this command, superiority is attributed to a single factor: the argument continues, is only possible conglomeration of capital in larg e elevated from the through applying the principle of coop- incorporated structures. Capital con- eration. To impress this on their readers, glomeration is seen as the main force realm of a rational the issuers spread this argument in vari- behind western industrial progress, the ous parts of the manshur, using different prevailing pattern of East-West trade, business choice to synonyms for ‘cooperation’: al-ishtirak, and western ability to extend their pres- al-ta‘awun, al-takaful, al-ittihad e t c . ence, hence political domination, to a command on (paragraphs 2, 3, 4, 7, 15). Within this dis- every corner in the world (paragraphs 3, course, collective capital mobilization is 4, and 15). A contrast is drawn here the individual and then projected as an incidence of such between the spread of the joint-stock cooperation (paragraph 4). The joint- model in Europe and the Eastern adher- the community, on stock model is thus elevated from the ence to individually-owned enterprise realm of a rational business choice to a (viz. proprietorships) which culminates in command on the individual and the capital fragmentation, and hence los- the strength of its community, on the strength of its role as ing ground to the West in production an organizational pre-requisite for the techniques, trade, and political power. role as an nurturing of wealth.

Closely connected to this line of reason- organizational Given fears of inconsistency between ing is Inma’ al-Mal’s discourse on the religious teachings and the charging of institutional uniqueness and vitality of pre-requisite for interest, however, a general argument banks, drawing again from the for joint stock structures would not alone European experience and emphasizing the nurturing of resolve doubts regarding the legitimacy a suggested link between the power of of banks. Here, the manshur moves in respective European countries and the wealth....” two interrelated directions in order to strength of their banks (paragraphs 5 resolve this issue. One is by applying the and 6). It is interesting to note here how principle of utility in explaining banks’ notions of current usage in global politi- mortgage and loss of agricultural lands vitality to economic activity, and it cal economy find their way into the to foreign moneylenders. An implicit link reaches here the extent of describing manshur, as for example the allusion to may be impressed on the public here banks as a public blessing (‘rahmah lil- the pattern of trade and division of between the preceding exposition on n a s ’—paragraph 6). The other labour on a global scale (paragraph 4), the expansion of European banking and approach is to directly employ opinions and to the clout of the East India the spread of foreign moneylenders in of Muslim jurists who distinguish usury Company as evidence for the power of the countryside. The public debt crisis f rom legitimate banking profits, with transnational companies (paragraph that created claims on the Egyptian moderation as the yardstick (paragraph 15). It is also interesting to note how treasury was thus compounded by the 9). Europe dominates the text, both by pro- fear of loss of lands to foreigners due to viding an inspiring historical model and, default on private debts. The manshur, The argument for establishing al-Bank al- as we will see, by being the adversary indeed, makes an explicit allusion to this Watani al-Misri, thus, is carefully knit as a against which the elites aimed at threat by warning against the repercus- national duty that fulfills God’s com- national self-assertion. sions of absence of national financial mands in nurturing wealth, that is consis- institutions in order to impress on the tent with Islamic law, and that would be Stemming out of this premise, the sec- public the urgency of that venture a landmark in emulating European insti- ond strategy in arguing for the bank is (paragraphs 7, 10). tutional models which account for so based on nationalistic grounds. Having much of Europe’s progress and clout. argued that political power is a function As if the nationalist duty, backed by Clearly, these strings of reasoning are of economic superiority, that the latter is European historical experience, was not mutually reinforcing and interconnect- a direct result of massive capital mobi- enough motivation, Inma’ al-Mal delves ed. Interestingly, while the issuers of the lization, and that banking acts as the into a third line of reasoning of a pre- manshur emphatically resort to these vital link in making this mobilization possi- sumably stronger binding nature: reli- justifications, they allude to the Bank as ble, the issuers of Inma’ al-Mal make a gion. Interestingly, the issuers of the a commercially viable project in an only passionate argument that establishing manshur not only found a need to bor- brief and in-passing fashion, and do so al-Bank al-Watani al-Misri is the means— row from this frame of reference, but only towards the end of the manshur possibly the only means—for the eco- they also apparently believed that this (paragraph 14), adding the quick nomic and political salvation of Egypt connection must be established at the caveat that commercial viability is the (paragraphs 8, 13, 16). Given the con- outset. Their point of departure, there- least important factor in establishing it. text, the public must have already been fore, was to begin the manshur by argu- Did this reveal a keenness in safeguard- prepared to accept that the ongoing ing that a religious obligation was ing the projection of the enterprise as a financial and political crisis was to a incumbent on individuals and on the nationalist, religious, and historical quest, l a rge extent the making of fore i g n e n t i re community to develop God- keeping the ‘misgiving’ of mundane banks. This feeling must have been given resources beyond their natural or motivations away from it? aggravated by a recent spread in the raw state (‘al-halah al-fitriyyah’— s e e

24 HITORICAL PERSPECTIVES

What we have at hand, thus, is not only “...[The immediate immediate and long-term factors that a proposal for emulating a superior busi- could account for the formation of that ness-organization model predicated on context of the call. But it opens up a whole set of inves- the drive for material progress, but, a tigations. How and when did the elites’ call impregnated in a mix of religious manshur] was a awareness of Western modes of business and nationalist duty to which the public o rganization begin? What were their should not, or would not, be expected power struggle earlier encounters with Euro p e a n to respond by a mere rational calcula- t r a n s n a t i o n a l s ?( 3 ) Could the drive to tion of risk-reward prospects only. In a over the control of establish a national bank be interpreted certain way, this reflects the issuers’ as an elite ambition to promote their awareness that their call was an extraor- Egypt’s finances share in the domestic market by getting dinary initiative: a move outside the into business activities that Western cap- adopted practices, a challenge to exist- and government ital had thus far monopolized? What ing power relations, and a quest for self insights does this give us about the assertion. To succeed, an appeal to that originated in dialects of Egypt’s integration in the decision making on the basis of extra- world market as a cotton exporter sev- business considerations was crucial. the public debt eral decades earlier? Finally, to con- Perhaps this could also explain the con- clude with a grain of salt, how much of fident rhetoric in the manshur where it crisis of the late Inma’ al-Mal could be taken to reflect makes a promise for further nationalist the ideology of the economic and polit- success and self-assertion (paragraph 1870s....” ical elite, and how much of it should be 11) in an apparent reflection of the pre- credited, instead, to remote learning by vailing political context and the interim existed long before the ultimate estab- the community of intellectuals who elite success in the National Front. lishment of the first joint stock Egyptian were beginning to use the spread of national bank, Bank Misr, in 1920. The Arabic newspapers in the late 1870s to Even though the call for al-Bank al- failure in ‘catching up’, at least in this articulate and spread their own visions Watani did not succeed, the ideological instance, was not due to a lack of and views? significance of Inma’ al-Mal re m a i n s a w a reness, knowledge, or entre p re- upheld for various reasons. First, the neurial drive but a product of other fac- END NOTES: manshur expressed an urge that seems tors, including the prevailing balance of 1. Inma’ al-Mal’ was reproduced in full and to have existed at that time among a power. identical versions in Salim Naqqash, Misr lil- circle of large landholders, merchants, Misriyyin (1883) and Tal‘at Harb, ‘Ilaj Misr al- When Tal’at Harb quoted the entire text Iqtisadi (1913). The latter was Harb’s treatise intellectuals, members of the parlia- on the necessity of a national bank, and was ment, and holders of key official posi- of the manshur in Ilaj Misr al-Iqtisadi aw published at the beginning of his campaign tions (2). From this perspective, it stands Mashru‘Bank al-Ummah (‘The Economic for Bank Misr. as evidence that the drive and vision to Remedy of Egypt or The National Bank 2. For details, see the discussion and citations establish a joint-stock national bank had Project’) at the beginning of his cam- in chapters 5 and 6 in AbdelAziz EzzelArab, paign for Bank Misr some thirty five years European Control and Egypt’s Traditional later, this stood as further proof for the Elites – A Case Study in Elite Economic continuing ideological relevance of Nationalism (Edwin Mellen, 2002). “...As if the Inma’ al-Mal. But the context also sug- 3. We already know that some larg e European corporations were active in fields gested further parallels with 1879. Harb’s bearing direct contact with the public since nationalist duty, treatise on the need for a national bank the 1830s. The East India Company operated was a product of the Egyptian National shipping lines since 1834, Lloyd since 1838, backed by Conference of 1911, a platform that and The Peninsular and Oriental Steam involved broad elite mobilization of a Navigation Company since 1840. Also, banks European historical similar nature to the 1879 National Front. and companies owned by foreign capital Notwithstanding important differences were being locally incorporated since the experience, was in instigating factors and purposes, both mid 1850s. The Egyptian Company for Steam Navigation was established in 1854, the Bank forums carried a sense of an opportune of Egypt in 1856 and the Anglo-Egyptian Bank not enough moment of national mobilization. in 1864. Egyptian elites themselves were start- Subsequently, the idea went dormant ing to participate with foreign capital in some motivation, Inma’ for a few years and was resurrected only business concerns. See EzzelArab, European within the euphoria carried in the 1919 Control, p. 130 and n. 24 & 25. al-Mal delves into national uprising. Was this further evi- dence that projects such as the nation- a third line of rea- al bank could only be carried in a con- text of some extraordinary set of circum- soning of a pre- stances that defy the usual state of affairs? Were the issuers of Inma’ al-Mal sumably stronger justified in betting the success of their bid for the national bank on the air of binding nature: national mobilization that prevailed in April 1879? religion...” The preceding textual study of the man- shur provides only limited insight into the

25 HITORICAL PERSPECTIVES

Manshur “Inma’ al-Mal”

(Translation)(1)

[1. The Nurturing of Wealth plest products? [Don’t you see how] they seek assis- is a Religious Command] tance [in everything, from] a machine to plough the land to a sewing needle, as a result of sending their God in His highness did not create any of His crea- crops [to the West] in the raw state (al-halah al- tures except to bear fruit (yuthmir) and to be useful. fitriyyah) at minimal prices and getting them back in He does not approve of leaving His gifts buried in a transformed form in the manufactured, decorat- the ground without bearing fruit; verily, what He ed, civilized state and consequently at multiple approves of is the cultivation of those gifts (yustath - prices? mar) so that they would grow and benefit the pub- lic. As people endeavour to nurture His gifts, the [4. Economic Cooperation fruits (al-thamar)(2) would surely yield [private mate- rial] gain (naf‘)(3) to their owner and God’s con- and Creativity: East versus West] tentment to the public, and He would increase their God has privileged the East with the most fertile soil wealth and put more riches in their hands. and the most precious mineral. There are many rich [people] of substantial incomes and abundant monies in there. Its peoples, however, were not [2. Cooperation in Nurturing Wealth guided to the most proper way for cultivating and as a Command] nurturing their lands’ wealth. You find them confined in their commerce to what their ancient ancestors People on this earth, notwithstanding their various practiced, separated in their enterprises as if they kinship relations and kinds, act in collaboration and fear that profits (al-barakah) would evaporate if combination (mutakafilun mutadaminun). They are they get into companies. [This is the case] in spite of all commanded to work together and to cooperate the gains (barakat) from joining up in businesses (al- (ma’murun bil-‘amal wal-ta‘awun) in what they do: ishtirak fil-a‘mal) that was demonstrated to them in the rich furnishes the poor with his wealth [as capi- the peoples of the West, who bewildered the inhab- tal], and the landowner hires the landless [as a ited lands and opened up vast regions with their labourer] in his agriculture. Science guides them all commercial companies and who were so creative in using that wealth and in cultivating the land, the in founding and diversifying such companies to the mother of all wealth, in the proper way. Had it not extent of creating commercial companies, industri- been for that cooperation (al-ta‘awun), mankind al companies, and financial companies or banks, would not have reaped from his labour or from his which are the subject-matter of this statement. wealth or from the earth that the Creator extended under his hands more than what other creatures obtain from hunting with their own claws or from [5. The Vitality of Banking what the land yields by mere coincidence. to All Business Activities] It is evident that banking is the link between various [3. Cooperation is the Key kinds of companies, commerce, and crafts and is for Material Satisfaction] the inevitable intermediary between [idle] capital and the gainful [use] of it. Without banking, a large Don’t you see that the people of the central parts of proportion of the world’s wealth would remain neg- our continent, notwithstanding the fertility of their lected without cultivation. Think of an owner of a soil and the abundance of minerals in their lands, vast property which yields a rent in excess of his can barely reap enough food for their day from the needs and who has the habit of using that excess to riches with which God endowed them because of buy new property. What would he do with the their repulsion of each other, their separation, and excess cash if it so happened in a certain year that their ignorance of the benefit of cooperation (al- he could not find a piece of land suitable for pur- ta‘awun) and of the power of unity (al-ittihad)? chase and if there was no trustworthy bank where Don’t you also see that there are other nations who he can keep his money as a fruitful deposit, avail- have similarly not achieved [material] satisfaction in able on demand, subject to his instructions, once he spite of being far from that primitive state [of central needs it? And suppose, on the other hand, that Africa] or perhaps even approaching civil perfec- another property-owner or merchant or craftsman tion (al-kamal al-tamadduni)(4)? Verily, don’t you had a need for a sum of money for a specific term, see how there are many of the Eastern nations of how would he procure the funds if there was no old, well established civilizations who are in need for bank that would lend him on conditions suiting his the West in anything that goes beyond the natural interests? [If] such a person in need knew of the produce of land, from the most complex to the sim- excess available with the [first] property owner, he

26 HITORICAL PERSPECTIVES

would request it from him by way of a loan. But who amongst us zealous [people] who would sacrifice their would ensure that that person of abundance would trust personal interests for the public good, and would spend him for his money or would agree with him on the terms? generously to achieve such [public] ends. Verily, we do The bank is, hence, the closer intermediary between not accept it. We have seen how our enlightened peo- both because it accepts the money of the former and ple and elites were exploring ways for salvation until God lends it to the latter at [mutually] agreeable terms. And guided them to establishing a national financial compa- since the bank is liable for the creditor’s money, it is care- ny. This was proposed to them by some leading mer- ful not to lend it except to trustworthy people. This is an chants, and they enthusiastically received it and moved obvious primary advantage of banking, and is the basis resolutely towards materializing it. It will come to exis- for measuring all transactions between merchants and tence shortly, adorned with a noble name, adopted as craftsmen [on the one hand] and capital owners [on the a good omen; verily it is: other]. It is evident from this example that the establish- ment of banks was a blessing for the people (rahmah lil- nas) and a major factor of facilitating their dealings and ... Al-Bank al-Watani al-Misri of making their prosperity possible. around which thoughts have often revolved and for [6. Banking and National which souls have longed. All our national newspapers Economic Power] had alluded to that idea, praised those promoting it, As for public interests, the advantages of banking are and called upon people to support them. Subsequently, too evident to require any verification. Those interests they carried to us the good news that the idea won the require financial means and administrative capacities support of the elite of the country’s enlightened people, that individuals cannot afford. Surely, if banks were omit- the most notable of its notables, and a large number of ted from European countries they would all become like the most notable of our delegates and prominent men. a bird with a broken wing, or an unarmed soldier, or a The bank has been the subject of various memoranda horseman with amputated legs. [If this happens,] the and correspondence between many of the higher power which made Europeans possess the seas and the authorities and none of them was but concurring, sup- deserts and control the world’s commerce and which portive, and wishing for success. No objection whatso- made it imminent for all [business] interests contracted ever was expressed by [our] countrymen because they anywhere in the world to pass in their hands would be are certain that it will all be beneficial, and are confident gone. If we look to the status of each of the European that it will fulfill the public interest. countries separately, we find that each of them main- tains the independence of her important banking institu- [9. Conformity with Islamic tions. The most independent with their banks are the Law (Shari‘a)] happiest of them. They enjoy the most extensive com- Someone might protest, fearing that the bank may con- merce, the most successful industry, the strongest clout, tradict the regulations of the sacred law on the assump- and the most forceful authority because capital is the tion that its dealings are bound to be usurious. [Such a basis of enterprise (al-mal asas al-a‘mal). If it is not with- person] might tempt people to believe that country- in reach, you cannot avail yourself of it when you need men’s support would not go beyond lip-service because it most. most of them are religiously forbidden from usury. We [want to] reassure the protester and eliminate [such] illu- [7. The Threat of the Loss sions. The sacred Shari‘a has but forbidden pure usury, of Land to Foreigners] which is not part of our bank. On the contrary, our bank Our condition is a fair testimony to the validity of the pre- will do without it because it will be established for the ceding [argument]. If we had an autonomous financial purpose of serving national interests with sincerity and power, we would have been able to recover vital inter- trust and in conformity with the religious doctrines of the ests which sadly remain impaired [by way of mortgage] country. Its activities will be lending and commission- to foreigners. We all fear the loss [of those interests and] earning from buying and selling on the account of its long to the day of regaining [them.] None of us alone is customers, all of which are activities that generate prof- capable of bringing this closer by even one hour. But if its from [commercial] transactions and are admissible by we act collectively, the achievement of that end would Shari‘a. The [legal] position of partners to such [transac- be subject only to our determination. Why, then, don’t tions] is that of partners in commercial speculation we make this effort if rescuing our land costs nothing (mudarabah) which is a lawful partnership by the con- more than getting together and cooperating (al-ijtima’ sensus of schools of Islamic law. Besides, commercial w a l - t a ‘ a w u n) to establish financial companies that transactions which involve an element of profit-making could achieve [ends] which individuals cannot reach? through commercial credit (murabahah) are old estab- Should we wait while most of our soils are mortgaged to lished and are abundantly explained in references on foreigners until that day when these are sold at the Islamic law. In the opinion of al-Khassaf, an example of cheapest prices while their owners are watching without legitimate transactions is getting support from their brothers to keep their proper- ty ? [when] someone sells a garment worth twenty dinars for a price of forty, then lends the buyer another sixty, [this] would bring the latter’s indebtedness to a total of one hun- [8. Resolution to Establish dred dinars, although his total receipts were only eighty. “al-Bank al-Watani al-Misri”] This is the school of thought God forbids it. We will not accept this while we have

27 HITORICAL PERSPECTIVES

of Muhammad ibn Salama, the spiritual leader (imam) of isfied by that sinful usury, they force him to sell his land Balkh. Shams al-A’imma al-Hulwani used to issue opinions to them at whatever price they impose. The peasant in accordance with the opinion of al-Khassaf, and to say complies with this helplessly after being overburdened that this is not a loan that generated profit, but is rather a by usury, which drags him to the ground and blocks the sale that generated profit (Ibn ‘Abidin, Radd al-Muhtar ‘alal-Durr al-Mukhtar, [The Answer to the Confused] vol. 4, doors of hope in his face. Whoever looks to the miser- page 175) (5). able status that the peasant reached, at a time when he is the life and backbone of the country, would There is another chapter [in the same work,](6) titled “If ascertain that if this prevailed for a few [more] years, the debtor repaid the debt or died before the maturity the ownership of the Egyptian lands or of most of it date, the amount of profit made through commercial would be transferred to foreigners. Egypt’s son, God credit should only be that part proportional to the forbids, would then be reduced to an agricultural elapsed period.” [This chapter] contains the following labourer on his and his ancestors’ own land. passage which is quoted from al-Qunya in the name of Najm al-Din: [11. The Bank as a Demonstration of the Revival of Egypt] according to the later [jurists,] [if] the debtor repaid the debt before maturity or [if he] died and the debt was taken But there will be no more reasons [to fear] such out- from his inheritance, the amount of profit on the commer- come once public subscription for al-Bank al-Watani al- cial credit should be proportional to the elapsed number of Misri starts. The bank, God willing, will be founded short- days. Najm al-Din was asked if this was also his opinion. He ly. This will please some souls and depress others. Those replied that it was, and added that if the creditor took the who will be depressed are none but those whose souls loan and the relevant profit before the maturity date, the are full of hatred. They want to deceive [our] country- debtor has the right to retrieve that proportion pertaining to men and frustrate their efforts so that they can contin- the remaining days. END [sic.] The commentator men- tioned at the end of the book that this was [also] the opin- ue to impose their excessive usury on those citizens who ion of the late jurisconsult Abul-Su‘ud, who justified it on the need loans because they know that if al-Bank al- grounds of sympathy between both parties. I add that such Watani al-Misri is established, national business will be was the opinion of al-Hanuti and others. And in the switched to it and they will be deprived from their Hamidiyya opinions, he was asked if [a borrower] was excessive usury. We have seen them making unfound- indebted to [a lender] by an identified amount of debt and ed claims that we are incapable of cooperating the latter charged the former a specific profit on that loan whether to avoid harm or to realize gain, accusing us of that was due at the end of a year, then the [borrower] died twenty days later and the loan became immediately incompetence of establishing a national bank that repayable by the heir[s,] should any part of the related would save our country from the sufferings caused by profit on the loan be paid? The answer of the later [jurists] foreigners, [and basing these accusations] on the pre- was that nothing would be taken from the contracted prof- text of [alleged] ignorance, weakness, and poverty. it except an amount proportional to the elapsed days. The The nationals will cut their tongues with a sharp sword, knowledgeable Najm al-Din was asked whether he would and they will taste this themselves, and will prove to issue his opinions accordingly, and he said he would. Our them that the nation which was the origin of civilization learned master of Anatolia, Abul-Su‘ud, has issued his opin- ions similarly. (7) and the educator of the world, since time immemorial, cannot be accused of ignorance after it rose to Whoever reflects on these excerpts would find that retrieve its previous glory and after it covered in a few they closely apply to the perceived dealings of al-Bank years, towards the cause of civilization, a distance al-Watani and would verify that the profits of the [pro- which no other nation achieved in generations. [The posed] bank are religiously lawful. It is well known that nationals will prove] that the lands which endured the profits on commercial credit had reached excessive inequity inflicted by the and other warriors rates of reportedly thirty and forty percent during the and conquered all of them, and which sustained the reign of the beloved Sultan Sulayman. As a result, the costs of wars and reforms undertaken by the beloved imperial edict was issued in accordance with the opin- Muhammad ‘Ali Pasha, the first Khedive of Egypt(8), ion of our master, the jurisconsult Abul-Su‘ud, that the and which was not destroyed by taxes and various repayment value of a loan of ten [units] should not exceed excessive payments of the previous days, [that nation] eleven and a half as mentioned by Ibn ‘Abidin (volume 4 should not be accused of weakness and of poverty. page 175). [12. The Necessity of Public Subscription] [10. The Rescue of Peasants But the responsibility of establishing our bank cannot be from Usurious Practices] the obligation of an individual or even of a few individ- The profits of the [proposed] bank will not [even] reach the uals of the nation. It is the obligation of all nationals to limit specified in ref e r ences on Islamic law (fifteen per- unite and cooperate to found it, starting from the ser- cent). Indeed, it might not exceed half of this [rate]. This is vant who [would] take one share to the rich master so because the prime concern of the bank is the public who [could] participate in the thousands. This is an good and the alleviation of the peasant’s sufferings by res - advantage that would distinguish the bank from all cuing him from the unfairness of usurers who enjoy the other banks and would guarantee its complete suc- sweat of his brow and the riches of his lands. These usurers cess, because all countrymen will endeavor for that seize the peasant’s toil as a cold booty by lending him success and mobilize their efforts to attract people to it. at the usurious rates of thirty and forty percent [per All people will, no doubt, prefer it over any other bank annum,] and more than that in many instances, against because it is from them and for them: it will deal with the mortgage of his land. When the date of repaying them in their own tongue, and will treat their business the loan falls due, and after their greedy appetite is sat- with the same care they devote to it.

28 HITORICAL PERSPECTIVES

[13. The National Bank achieved except through the operations of al-Bank al- and Economic Salvation] Watani al-Misri. Therefore, princes, elites the wealthy people of the country, and all those who care for her Furthermore, the bank will benefit the country in vital interests, are called upon to immediately follow the matters, and will enable countrymen to rescue many of example of their good brothers who initiated the sub- the country’s interests, like the Domain and Saniyya scription, and to collaborate in establishing al-Bank al- lands (9), from foreigners’ hands. The initiation of efforts Watani al-Misri. Time is of gold, and cannot be retrieved to establish the bank coincides with the rise of the coun- if it elapsed. God awards success to whoever seeks His try’s enlightened people and the mobilization of most of blessings and reward. their efforts for this task. They have all determined that a national bank is the only intermediary that will enable END NOTES: them to accomplish their aspirations, since the existence 1. A more literal, and more cumbersome, translation has of a trustworthy guarantor is inevitable should those a p p e a red as Appendix 2 in EzzelArab, Euro p e a n interests be extracted from the hands of foreigners. This Control. In the present translation, I am trying to give can only be fulfilled by al-Bank al-Watani. Countrymen preference to clarity of expression over literal accuracy should hurry and race with the founders in subscribing without distorting the meaning. Also, the original text, for the bank and participating in it. annexed above, has very little punctuation. In the earli- er translation, this is clearly revealed by insertions of [14. The National Bank punctuation marks within square brackets. This is omitted as a Profitable Project] h e re in the interest of a less cumbersome form . We have frequently read in the national newspapers Substantial additions of words, however, are here that the country will not bear the existing unfairness, and retained within square brackets. All aub-titles are my that it will undoubtedly rise to end it. These papers were own insertions. reflecting the aspirations of all countrymen. It is evident, 2. Note the word “yuthmir” or “to bear fruit” and its deriv- however, that we are addressing a cause of purely atives “yustathmar” and “thamar,” which are used here material nature, in which tangible money is the only to describe the extraction of a physical outcome thing that counts. If savings are not used in this way, (“thamar” or fruit) from economic endeavours. In our what would their benefit be? But the founding of the present day usage, the word “istithmar,” which generi- bank will not deplete any such savings, since the bank’s cally means the application of human effort to a given capital will be commercially employed in a profitable resource for the purpose of extracting a fruit, is the term manner for its owners and will generate public benefits used for “investment.” for the entire country, namely salvation from financial 3. The word naf‘, which I translated to “[private materi- enslavement to foreigners. Private gains become a sec- al] gain,” may be equivalent in our present day usage ondary matter relative to this cause. These aspirations to the term “profit.” are not far fetched because effort and perseverance 4. Clearly, “Inma’ al-Mal” makes a distinction here will guarantee the materialization of hope, and power is between civil perfection and material satisfaction, in unity. although the terms of this distinction is unclear. 5. This passage is not indented in the original text, but it [15. The Significance is inserted between quotation marks. The names in the of the East India Company] indented passage refer to Muslim jurists. I opted for an abridged translation of Ibn ‘Abidin’s work. Whoever remembers that the British possessions in 6. The statement in the text is “There is a passage on India—whose border-lines circumvent half of the globe page 171 of the same volume in the chapter titled ...” and is among the world’s most fertile and most populat- 7. Again, this passage is not indented, but is inserted ed territories—were joined to the British dominions by the between quotation marks. The names and titles in the efforts of a company established at the beginning of passage refer to Muslim jurists and writers on Islamic law. the eighteenth century and initially capitalized at 30,000 I placed “borrower” and “lender” between square pounds, would ascertain the validity of the argument brackets. The original text follows the convention of made in this treatise regarding the benefits of associa- using the Arabic names “Zayd” and “‘Amr” in referring tion (al-ishtirak) and will also ascertain that the power of to hypothetical individuals by way of giving some exam- capital is through [employing it in] business (quwwat al- ple. mal fil-a‘mal). 8. This is an obvious historical error. The title Khedive was first given to Isma‘il (1863-1879) in 1867. Prior to this date, [16. Conclusion: Muhammad ‘Ali and his ruling descendants carried the A Call to the Entire Nation] title of Wali (governor). The issuers of the manshur were We hope that this example suffices to incite the will- surely aware of this. However, they might have used power of those who have not yet moved to serve their ‘Khedive’ by way of showing additional respect to the country, and who ignor the power of unity. [May] it moti- Muhammad ‘Ali family. vate everyone to support the establishment of al-Bank 9. The Domain and Saniyya lands were originally royal al-Watani and to collaborate in founding it. There can estates that were taken as collateral against Egypt’s be no progress for the homeland without liberating the public debt in the 1870s. These estates were later sold to peasant from the injustice of usurers, and there can be private landholders and contributed to the expansion in no might or freedom for the state without extracting its the property of the large. interests from foreigners’ hands. Both ends will not be

29 HISTORY IN THE MAKING Lawand Economy inEgypt Socio-economic Realities of the New Parliament

Zeinab Abul-Magd, PhD Candidate, Georgetown University

“Through ‘law,’ the State…tends to create a social conformism which is useful to the ruling group’s line of development.” Antonio Gramsci, Prison Notebooks

ovember and December Changing Elites, Economies 2005, witnessed violent par- and Laws liamentary , which resulted in a The Egyptian historian Ra’uf ‘Abbas substantial change in the indicates, “if Egypt before the 1952 rev- Npolitical map of lawmakers as well as olution was ruled by landowning bour- the socio-economic structure of the geois, the businessmen lobby today People’s Assembly. Although, the dominates the party’s [NDP] structure National Democratic Party (NDP) kept and the parliamentary life…they con- the majority of seats, 88 deputies from trol the process of presenting projects of the Muslim Brothers won, while the leftist new legislations and laws, pre v i o u s l y and liberal opposition managed to win dominated by technocrats.”(1) Egypt only 17 seats. The 2005 parliament went through radical changes in its marks the emergence of new realities Egyptian Parlliment. Courtesy of political economy since its first parlia- that might affect the course of “eco- www.meib.org/ images/0308_dem.jpg ment was constituted in 1866. It passed nomic reform” over the coming five t h rough an agriculture-based liberal years, with the continuity of the domi- economy from late nineteenth to early nation of the NDP’s businessmen, the twentieth century, a socialist economy existence of a considerable conserva- and state capitalism under Nasser in the tive opposition representing middle- to 1960s, the open door policy under u p p e r-class professionals, and the Sadat, until it reached the era of the absence of adequate left-wing opposi- structural adjustment and economic tion representing the lower classes. By reform from 1991 onwards. The socio- and large, the history of the socio-eco- economic structure of the parliament nomic structure of lawmakers reflected reflected the state’s political alliances the structure of the ruling elite and their and was tailored to fulfill the economic economic interests in the Egyptian state policy adopted by the ruling elite. It has since the parliament was first founded been mainly family-based; the state co- in the 19th century till today. This article opted local big families whose eco- attempts to trace the history of change nomic interests met with its own. Even in this structure throughout the last cen- the official name of the parliament Egyptian Parlliment (closeup). Courtesy of tury up until the present. Then, it decon- changed in a manner that is parallel to weekly.ahram.org.eg/ 1999/426/ec1.jpg structs the new parliament to depict a perceived visions of its role in economic preliminary picture of the social back- life. ground of lawmakers and how they might affect the course of economic In the late 19th century, when the coun- change five years from now. try’s economy was centered around

30 HISTORY IN THE MAKING

c o m m e rcial agriculture, the enterprises to businessmen at below- objections of the few opposition mem- “Consultative Congress of Deputies” market prices. On the other hand, the bers who represent the disadvantaged was selected from elite families repre- same law allowed laying off hundreds lower classes. From the leftist opposition senting the Turko-Egyptian large land- of thousands of workers only to join the parties, there were only two Nasseri holders. Large landowners and the new unemployed(4). Similarly, Law No. 96 of deputies and six from the Tajammu‘. industrial bourgeois formed the majority 1992 librated the agricultural land rents They raised fierce arguments about the of the parliament deputies in the early and led to the evacuation of around a aforementioned laws, but the voice of 20th century, but they enjoyed no actu- million peasants from their plots for the the NDP majority prevailed (11). al authority in legislation. Under the benefit of old and new elite of large socialist state, Nasser set the socio-eco- landowners (5). The laws of privatization Deconstructing nomic order of the “Nation’s Council” and the reduction of subsidies led to a the New Parliament in accordance with his corporatist sys- decline in the standard of living of the In the new Assembly of 2005, the list of tem, where the bureaucrats, tech- middle-classes, which is shrunk while the NDP lawmakers consists of business- nocrats, workers and peasants were poverty continued to mount (6). men, government bureaucrats, and the main players. However, the presi- former security and army officers. While dent and executives, rather than the In 1995, 37 new businessmen joined the the NDP won 320 seats after it admitted parliament had the upper hand in law- Assembly. The parliament included a independents, the Muslim Bro t h e r s making. The Sadat open-door policy total of 66 businessmen, 59 of whom (MBs) won 88 seats. The opposition par- necessitated the incorporation of a belonged to the NDP. The number of ties retained a totality of only 17 seats, new elite of capital owners into the leg- businessmen in the 2000 parliament including six from the Wafd, two from islative body. The old elite of the social- i n c reased to 71 members among the Tajammu‘, and two Nasserists but ist period allied itself with the new one whom were 30 big businessmen. Gamal no one from the Nasseri party. The to enact laws transforming the system. Mubarak’s and his associated business social background of the deputies of The “People’s Assembly,” from 1976 up elite like Ahmad ‘Izz and Muhammad each political camp is genuinely dis- until the 1980s, dominated by the newly Abu al-‘Ainin, appeared in the last tinct: old and new elite of businessmen founded National Democratic Party Assembly as main players. Heading and landowners belong mainly to the (NDP), was more of a supervisory than a important legislative committees, such NDP and the Wafd liberal party, and legislative body, since the presidential as the Planning and Budget, the they control around 50 per cent of the system made it a collaborating rather Economic, and the Industrial commit- than an autonomous institution.(2) tees, they interfered heavily to enact laws pertaining to privatization that Businessmen emerged as a leading grou p served their own interests (7). Ahmad Al- “...After the recent of lawmakers only in the late 1990s. They Sayyid al-Naggar illustrates that they have since capitalized on the economic imposed their vision on govern m e n t enactment of the ref o r m program to achieve personal inter- executives in drafting laws, such as ests that neither observe the dictates of a labor, mortgage, and tax laws(8). For laws of taxation, market economy nor enhance econom- example, the Egyptian Unified Labor ic development. Law No. 12 for 2003 maximizes the rights of the enterprise owner at the expense investment, and Enhancing development would have of the rights of the worker. It allows busi- been done through promoting com- ness owners to terminate labor con- labor has given petitiveness as opposed to monopolies tracts whenever they wish for unspeci- and expanding the job market rather fied reasons. The new Tax Law No. 91 of leeway to than generating unemployment. In 2005 places all businesses that earn 1991 the agreements on macroeco- more than LE 40, 000 per annum under businessmen to nomic stabilization and structural the same category. This allows large adjustment with the IMF and the World businesses that make millions of pounds avoid their dues to Bank deemed the old socio-economic annually to be subject to insignificant structure of the Assembly unfit for the tax rates and yet benefit from all indus- public services state’s economic policy; a new elite trial and commercial public services had to be co-opted to work on promul- that petty businesses and the lower and limit the rights gating necessary legislations. Eberhard classes pay for from their small pockets. Kenlie notes that, “a limited number of Similarly, the new anti-trust laws did not of workers, more owners of capital saw their liberties lay out enough regulations to end the extended and their position re i n- monopolies that already exist in certain laws related to the forced…it is difficult to see how the sectors whose owners partake in draft- regime could do without them and not ing the laws, such as Ahmad Izz (9). In programme of co-opt them in one way or another.”(3) addition, businessmen keep the legisla- Consequently, promulgated laws tive agenda busy with law projects that economic reform enhanced the benefits of capital own- they would benefit from, and block ers at the expense of workers, peasants other law projects that might benefit are waiting to be and the middle class. For example, Law workers, peasants and the middle class No. 203 of 1991 that gave legal leeway from being discussed (10). Laws relevant issued....” for privatization of the public sector led to privatization and agricultural land to the sale of profitable state-owned tenure were enacted in spite of the

31 HISTORY IN THE MAKING

seats after their number in the mittees still reflect the domination of Assembly has doubled. Middle- and the Lajnat al-Siyasat g roup, since upper class doctors, engineers and Ahmad Izz has been nominated once other professionals belong to the MBs m o re to head the Planning and and a few middle- to low-class Budgetary Committee and deputies belong to the left-wing oppo- Muhammad Abu al-Inin is heading the “...The socio- sition. No doubt that this social/political Industry and Power Committee. The old anatomy of the new parliament will and new elite will most probably col- economic affect the economic legislations in the lide, which might affect the accelera- coming five years. tion of the course of economic reform structure of the Outside large urban constituencies one way or another. such as those of Cairo, the criteria of parliament running and winning were family and Although the current contro v e r s y clan based – re g a rdless of political about significant representation of the reflected the inclinations – for the NDP, the Muslim Muslim Brothers (MBs) in the new Brothers, and the opposition runners Assembly shows concern about the state’s political alike. Candidates of all political affilia- potential negative impact they might tions relied in voting on their home- leave on economic reform, the socio- alliances and was towns, since they belonged to wealthy economic structure of those members or reputable families some of which and their political discourse indicate tailored to fulfill the have kept parliamentary seats since that their effect will probably be less the late 19th century. They provided radical than imagined. The MBs bloc is economic policy community and charitable services in composed of middle- to upper-class their own villages or places of origin, professionals such as doctors and engi- adopted by the such as erecting schools and clinics or neers, who form the MBs prominent distributing foodstuff and clothes. There members(16). Their vision of the needs ruling elite....” is no space for advocating any politi- of the lower classes has a charitable cal agendas in such an environment. In character framed by an “alms-giving” addition, instants of bribery are numer- p e rception of economic develop- ous in the case of the NDP candidates, ment. In general, their political rhetoric while some MBs candidates bought pays more attention to cultural/re l i- votes through distributing charitable gious issues. Matters such as con- items in villages and poor neighbor- f ronting corrupt businessmen or port for the disabled and the unem- ployed (19). This agenda does not seem hoods (12). defending the rights of workers, peas- to pose substantial threats to any ants, and the middle class harmed by potential NDP plans to enact new laws The NDP’s wealthy elite is far from being new privatization laws hardly appear in a homogenous group. It consists of the their discourse, as opposed to the issue supporting the business elites’ vested very traditional elite of provincial and of application of shari‘a law and politi- i n t e rests. In terms of the MBs cam- paigns against corruption, some rural wealthy families, the conservative cal freedom. This is evident in their per- observers doubt such claim because old guards surviving from pre v i o u s formance in the last Assembly, as their the MBs themselves followed the exam- regimes, and the new businessmen fifteen members focused their political elite affiliated with Gamal Mubarak’s battles on banning books or movies ple of the NDP members in mobilizing Lajnat al-Siyasat (The High Council for deemed violating Islamic law. In addi- votes through bribery in some con- s t i t u e n c i e s( 2 0 ). After winning, MBs Policies) in the party. The latter group tion they argued for limiting women’s fought for heading the education, has gained enormous political power legal rights, rejecting American grants, health, and human rights legislative since the late 1990s, and it is the most p rohibiting the import of meat not assertive about liberalizing the econo- slaughtered according to shari‘a from committees, but they succeeded in my. Gamal Mubarak and the business the US and Europe, prohibiting dancing heading the health committee only. Some sources allege that the NDP will elite affiliated to his council attempted schools, prohibiting bank interests and utilize the MBs to pass new controversial to construct a popular image during similar matters (17). laws in economic reform using their the electoral campaign, but they faced harsh failure and they ended up The post-election political rhetoric of fatawa or religious support to appease irritating the public in the constituen- the MBs leaders in 2005 is no exception the public(21). cies they visited with immature political to the aforementioned general trend. The scandalous defeat of the leftist discourse and lead to the failure of the They campaign for changing the con- opposition parties, the Tajammu‘ and candidates they meant to support (13). stitution, insuring that courts work in Therefore, observers insist that the old conformity with shari‘a law, banning the Nasseri in particular, left no serious challenges to the NDP’s capitalists in guard has regained some of their lost alcohol and gambling, etc¸ ( 1 8 ). the Assembly. The opposition’s political power against the new business F u r t h e rm o re, their current economic rhetoric insists that fraud was a means elite(14). At any rate, old and new cap- agenda is oriented toward charity, as deployed by the State to fail its candi- italists in this legislature managed the apparent in their tactics of penetrating vote through bribery; they spent mil- poor neighborhoods through discount dates, including their leaders, while lions to win seats and employed thugs clinics and educational centers independent observers affirm that the defeat is attributed to entre n c h e d to intimidate and threaten voters. Their besides large-scale alms giving on reli- internal weaknesses in the parties. Only declared agenda was designed for gious occasions. For example, they ask two Tajammu‘ deputies, from the con- their own business interests (15). The for- the rich to support the poor through mation of the central legislative com- providing free health and social sup- stituencies of Cairo and , won to 32 HISTORY IN THE MAKING

fessional who relied in winning his seat Misr,”Ahwal Misriyya, No.1, Summer 1998; on the traditional power of his family of Muhammad al-Sayyid Sa‘id, “Ahwal al- large landholders in Lower Egypt. The Tabaqa al-Wusta,” Ahwal Misriyya, No.1, agenda of another Wa f d i s t , Summer 1998. “... Outside 7. Kienle, A Grand Delusion, p.59; Haytham Muhammad Shurdi from the Jabr, “Rijal al-A‘mal wa-al-Siyasa fi Misr,” large urban constituency, focuses on the rights of Ahwal Misriyya, No.21, Summer 2003, merchants in the zone in the pp.134-135; ‘Amr Hashim Rabi‘, “Rijal al- constituencies port(23). A‘mal wa-Tashri‘at al-Khaskhasa,” Qadaya Barlamaniyya, No.40, July 2000. pp.6-11. For such as those of After the recent enactment of the laws more details about Mubarak the son’s polit- of taxation, investment, and labour has ical coalition of businessmen see: Mohamed given leeway to businessmen to avoid Menza, “Gamal Mubarak and Egypt’s Neo- Cairo, the criteria Business Community,” C h r o n i c l e s , v o l . 1 , their dues to public services and limit no.2, pp. 33-36. of running and the rights of workers, more laws related 8. Al-Ahali, 21 September 2005. to the programme of economic reform 9.For details and other examples see: winning were are waiting to be issued. For example, Ahmad al-Sayyid Al-Naggar (ed.), Taqrir al- new regulations with regard to privati- Ittijahat al-Iqtisadiyya, 2005 (Cairo: Markaz zation, restructuring the pension and al-Dirasat al-Siyasiyya wa-al-Istratijiyya, family and clan insurance schemes, and reforming the 2005), pp. 309-315, The Land Center For financial sector are expected to Human Rights’ biannual reports on workers. 10. The Land Center for Human Rights based – regardless appear. If elite businessmen continue Workers’ Report, Cairo, October 2003. of political to be the only powerful group domi- 11. ‘Rabi‘, “Rijal al-A‘mal,” pp.6-11. nating economic affairs in the 12. C.f. The Land Center for Human Rights’ Assembly, while the leftist opposition is Election Monitoring Reports, inclinations – for considerably weak and the middle- or November/December 2005. upper class MBs are chanting with a 13. Ibid; Al-Arabi, 11 December 2005; Sawt the NDP, the charitable vision of development, the al-’Umma, 12 December 2005. new parliament will continue enacting 14. William Wallis, “A Problem Putting Muslim Brothers, P romise into Practice” Financial Times, 6 laws serving the elite businessmen at December 2005. the expense of other segments of the 15. Al-Ahram Weekly, 8 December 2005; Al- and the opposition Egyptian society. Biased and unbal- Ahali, 2 November 2005. anced regulations should severely dis- 16. Afaq ‘Arabiyya, 15 December 2005. runners alike....” rupt the course of economic develop- 17. http://www.ikhwanonline.com/Article. ment in an already underdeveloped asp?ID=14787&SectionID=496; Al-Ahram, 9 country. They have evidently led to December 2005. lowering growth rates, increasing the 18. The Daily Star Egypt, 9 December 2005. represent the interests of workers and 19. Al-Hayat, 13 December 2005. budget deficit, and raising unemploy- peasants, and they are not even as 20. C.f. The Land Center for Human Rights’ ment and poverty rates. The socio-eco- outspoken as their two former deputies Election Monitoring Reports, nomic structure of the new Assembly who lost their seats in Alexandria and November/December 2005. demonstrates that no radical change is Port Said. The two leaders of the two 21. Al-Ahali, 7 December 2005; Nahdat Misr, likely to take place in the short term, as 11 December 2005. parties, Dia’ al Din Dawud and Khalid the new deputies’ agendas pay little or 22. Al-Masri al-Yawm, 12 December 2005. Muhyi al-Din, failed to maintain their no attention to issues such as job cre- 23. Nahdat Misr, 19 Decmeber 2005. seats, and thus serious objections to ation, labor migration, or agricultural new economic reform legislations will land tenure. In such a political climate, substantially decline. Leftist opposition economic development seems far in the previous Assemblies was weak, from being an attainable goal. but at least some politically active fig- ures were there to question the power END NOTES: of businessmen. As for now, Muhammad Abd al-Aziz Sha‘ban, one 1. Al-‘Arabi, 4 April 2004. of the two Tajammu‘ deputies, stated 2. See: Al-Sayyid Yasin (et. al.), Al-Ittijahat al- that the role of the secular opposition Jadida fi Majlis al-Sha‘b (Cairo : Markaz al- will be more active in interrogating the Dirasat al-Siyasiyya wa-al-Istratijiyya, 1976), ministers and monitoring the govern- pp. 14-21; Noha El-Mikawy, “The Egyptian ment policy rather than playing a role Parliament and Transition to Liberal Democracy,” American Arab Affairs, no. 36 in drafting laws (22). As for the agenda (Spring 1991), pp. 19-21. of the Wafd liberal party, it raises issues 3. Eberh a rd Kienle, A Grand Delusion: of corruption and political develop- Democracy and Economic Reform in Egypt ment, but it does not go far in criticizing (London: I.B.Tauris, 2001), p. 130. the economic reform program com- 4. See: Nahid ‘Izz al-Din ‘Abd al-Fattah, Al- pared to the leftist parties. Its deputies ‘Ummal wa-Rijal al-A‘mal: Tahawwulat al- do not genuinely represent the social Furas al-Siyasiyya fi Misr (Cairo: Markaz al- classes that are negatively affected by Dirasat al-Siyasiyya wa-al-Istratijiyya, 2003). the new laws of market economy. The 5. See: The Land Center for Human Rights Peasants’ Report, Cairo, October 2004. head of the Wafd representatives, Dr. 6. C.f: Dina Shehata and Manal Lutfi, “Al- Mahmud Abaza, is an upper-class pro- Tabaqa al-Wusta wa-al-Dawla fi 33 HISTORY IN THE MAKING Skirmishes in The War for Drugs

A Report on "Egyptian Pharmaceuticals & TRIPs" Seminar

Mostafa Hefny, Project Officer, EBHRC.

he devil really is in the details. separate, North-South confro n t a t i o n olution, not tactical adaptation. If this over agricultural subsidies in Europe and big picture is really an accurate depic- The big picture is one of dra- the United States, the representatives of tion than clearly the whole debate cur- matic opposition. In the pop- the poor seem to be clinging to rules rently underway is little more than nui- ular imagination, the battle laid out by the industrialized world – only sance to the multinational companies Tline is cruel and stark. On one side is a for them to change their minds and whose victory has been declared by c o r p o r a t e - g o v e rnmental alliance, on demand a welfare program for a group this narrative – which has been ostensi- the other are two billion people in the of multinational pharmaceutical com- bly one of protest. developing world without consistent panies who oversee a 450 billion dollar access to vital medication - more often industry that is the world's most prof- The fact of the matter is the confronta- represented, if at all, by nongovern- itable business. tion continues. But if the big picture sce- mental organization rather their own nario leads to a dead end, a closer governments. Those governments have On those terms the battle quickly consideration of the tributaries of this been reintegrated into a world eco- becomes apocalyptic. The representa- conflict my yield a fresh narrative nomic system whose rules have been tives of the poor, be they the non- s t ream. One such tributary is Egypt laid and are enforced by the ravenous g o v e rnmental organizations or the where, as of the 1st of January of 2005, alliance. In offices far above the popu- occasional government, can only the WTO Agreement on Trade-Related lation the system summons an arsenal escape the re p e rcussions of this Aspects of Intellectual Property Rights of legal chains and mantraps that are arrangement by dismantling the patent (TRIPs) came into effect. The signs of finally distilled into that most odious of system – the very paste that holds the substantive re p e rcussions of the documents: The Patent. whole apparatus together. If, as the enforcement of the agreement on the multinational pharmaceutical compa- p h a rmaceutical sector became evi- This representation maybe lacking in nies continue to argue, patents are dent in the press early in the year with nuance, but not irony. If the enforce- necessary for the development of vital consumers and then pharmacists inun- ment of the new world economic sys- medicines, then the only situation drugs dating the press with complaints that tem has been cruel in its insistence on maybe made accessible to the poor is price of medicine had suddenly sky- the dismantling of social welfare sys- one where there are no drugs to begin rocketed – including those required for tems in the countries of the south in with. For those concerned with the wel- the treatment of chronic diseases. As favor of unbridled market capitalism, fare of the populations of the south – noteworthy of the number of com- the maneuverings of this battle have not to mention the local pharmaceuti- plaints was the avenue. Indeed the reduced representatives of the poor to cal industries under increasing pressure business daily, Al-Alam Al-Yawm-- nor- begging for the mercy of the market. to halt production of generic versions of mally a staunch supporter of every step Along with a parallel, and not entirely patented drugs – the task is one of rev- towards capitalist integration--privati- 34 HISTORY IN THE MAKING zation undertaken by the Prime Minister Reverting to a prepared presentation, ness of the development of the final Ahmad Nazif's government, published El-Hakim gave an overview of the med- product – including years of clinical tri- a number of these grievances. The fre- ical leaps made by humanity in the als – that have been taken into quency of commentary on the subject course of the 20th century. Citing the account by authorities in their formula- was such that it was indicative of elimination of diseases such as Polio tion of legal protections in the form of important, and perhaps perm a n e n t , and Small Pox as global health threats, patents. The world has developed an changes in Egyptian pharmaceuticals. he lauded the initiative of private incentive system to encourage this The nature of the changes then enterprise as the engine behind this process and help alleviate the afore- became the subject of a seminar on unambiguous pro g ress in decre a s e d mentioned impediments – the incen- "Egyptian Pharmaceuticals & TRIPs," death rates around the world. Indeed, tive system has been the protection of organized on the 19th of September he attributed 90 % of all new medicines undisclosed trade secrets with patents. 2005 by the Economic and Business to private enterprise, a process com- For Egypt, El- Hakim highlighted several History Research Center as the first in its posed of three demarcated steps: dis- important dates in the protection of new “History in the Making” seminar covery, synthesis and formulation. The intellectual property rights – the gov- sessions. first of these steps, discovery, is the most ernment's joining of the WTO in 1994. important – dependent as it is on Egypt exercised its right to a five year The speakers, sought to represent dif- investments in research and develop- "grace period" until 2000 when it was fering points of view, were, first, Mr. ment. El- Hakim then described four obliged to protect undisclosed "trade Ahmed El-Hakim the "Regional External stages in the bringing of a new drug to secrets". A further five year grace peri- Affairs and Policy Director" of Pfizer. The the market, which are completed od was granted up to the year 2005 company, a global behemoth, is the upon a positive answer to the following when complete protection was man- largest pharmaceutical multinational in four questions: dated by TRIPs. El- Hakim stressed that it Egypt with LE 300 million in investments is only with complete compliance with and ambitious plans to expand. Mr. El- 1- Will the proposed drug address an the protections of intellectual property Hakim was quoted in the press prior to unmet medical need? rights that companies such as Pfizer the session explaining his company's 2- Is it possible to produce the pro- may move some of their development intentions of increasing the size of its posed drug in a laboratory? activities to Egypt, and added that investments in Egypt to LE 700 million 3- Is it possible to conduct clinical such compliance is already stipulated over the next few years and further trials on patients? in Egyptian Law 82 of 2002 and is not build on its 7 % share in the fragmented 4- Is there a sufficient return on only enforced by the new obligations Egyptian market, which is curre n t l y investment? under TRIPs. This, he argued, would help worth 1.3 billion dollars annually. Also alleviate Egypt comparatively poor present was Mr. Hossam Bahgat, the The world's base of biomedical exports of pharmaceuticals, which in director of the Egyptian Initiative for knowledge expands through the 2004 amounted to a mere 41 million Personal Rights (EIPR), an NGO whose investment of either government-fund- dollars compared 261 million dollars for pioneering Health and Human Rights ed research initiative in national health neighboring Jordan. Ahmed El-Hakim program had recently published a pol- institutes and universities or the inde- concluded his remarks by expressing icy paper entitled “The TRIPS pendent research of private corpora- confidence in the government of Agreement and Egypt’s Responsibility tions such as that which El-Hakim repre- Ahmad Nazif and its willingness to to Protect the Right to Health”. sents. The mapping of the human implement its obligations as mandated Concluding the list of speakers was Dr. genome has exponentially increased in the agreement. But it was this very Mohamed Raouf Hamed a noted pro- the possibilities of discovering new government that fessor of pharmacology at the National medicines but has, in turn, increased O rganization for Drug Control and the costs of research and any resultant Research and frequent commentator discoveries. The process begins with a on the sector. Dr. Hamed had recently consideration of more than 7 million completed a booklet in which he molecules and all the possible permu- offered an analysis of what he identi- tations and linkages with other com- fied as a crisis in Egyptian pharmaceu- pounds and genes and is narrowed “... the system ticals. down, 12 to 15 years and "on average" 800 million dollars later, to one or two summons an The case for the multinationals began compounds. It is a process whose pri- in economic terms. Respect for intel- mary feature is failure and elimination arsenal of legal lectual property rights as represented of compounds whose potential has by the TRIPs agreement is one of the gone unfulfilled despite large invest- chians [..] that are vital components of creating a healthy ments. Even when a drug successfully business environment, argued El- navigates the obstacle course to the finally distilled into Hakim. Egypt, he asserted, needs 8 – 10 market, a significant risk remains with billion dollars annually in order to cre- people’s reception of the drug. There the most odious ate between 700 thousand and 800 will always be a percentage of drugs thousand jobs a year, a figure unattain- that, despite clinical trials and regula- document; The able except by foreign investment tory approval, must be recalled – with such as that carried out by Pfizer Corp. the attendant cost of such a recall, Patent....” Such investments, whether in infrastruc- which must be absorbed entirely by the ture or in the development of new pharmaceutical company. drugs, is contingent on the protection of intellectual property rights. It is these investments and the arduous- 35 HISTORY IN THE MAKING was addressed, in a more critical light, figures announced by El-Hakim with fig- by Hossam Bahgat of the Egyptian ures of his own, referring to the evident Initiative of Personal Rights (EIPR), case of HIV AIDS medication which whose robust counterargument was, had cost 10, 000 dollars to meet the surprisingly, centered on a call to annual needs of a single patient, a fig- Egyptian authorities to implement the ure that has fallen dramatically to a TRIPs agreement as written!Bahgat m e re 200 dollars when chemically demarcated the divergence in bases identical generics became available. and goals of his organization and a The point here is not only the price dis- company such as Pfizer on the matter crepancy, but that this discrepancy of public health and intellectual prop- exists with regards to an unsubstitutable erty. Intellectual property rights had life saving drug. Hence, in considering never been targeted as an area of intellectual property rights, Bahgat study or advocacy by EIPR – but as an asserted, an abstract argument can- organization concerned with the law not stand aloof of a reality whence and the legal framework surrounding there are creditor nations and debtors issues of health and human rights it – where a third of the world's popula- became imperative to engage the tion is without access to basic medica- laws through which the state is required tion. This reality includes other figures: to protect its citizenry's health – or to 14 million people die yearly of infec- put is more accurately, the citizenry's tious diseases – of those, 9 out of 10 live right to health. International law does in developing countries. not mandate state protection of citi- zens against contacting disease, but Bahgat proceeded to supply more fig- The cover of Raouf Hamed’s publication their access to health care in the case The Structure and Legal Underpinnings of the ures. The first was a demonstration of of ailment. For his part, Bahgat also pro- Egyptian Pharmacuetical Sector in the the portion of national budgets spent vided four criteria with which the state's Context and International Trade Agreements: on medication, which in the devel- obligation to uphold the "right to A Strategic Vision oped world is never more than 20 %, health" is judged. In sum, the criteria are the avenue of those who represent whereas the figure is often as high as 66 are legal test for the existence of this other interests, such as Mr. El- Hakim. % in the developing world. Moreover right: Those concerns must always be the portion of that spending borne by weighed against the availability and the population, rather than a state 1- The quality of products and service accessibility of drugs. This, explained funded welfare system, is between 50 provided Bahgat, represents a significantly differ- to 90% in the developing world. The fig- 2- The acceptability of the products ent approach to the question of intel- u res are inclusive of Egypt but not and service to the patients lectual property rights and their impact exclusive to it. The problem is one of 3- The availability of the products and on Egyptian pharmaceuticals. North and South, and it is significant service to patients that none of the great multinationals 4- The accessibility of products and The theory outlined by El-Hakim and that today control the global pharma- services to patients. This in turn maybe other representatives of multinational ceutical industry are located in the split into two types of accessibility: firms is a form of contract between developing world. access to information regarding the those who discover a drug and the product and service (in this case the public. The former agree to grant The weight of these figures then makes drug) and physical access to the drug access by the public to the drug in striking the balance between the pri- itself. re t u rn for remuneration over and vate interests of the drug companies above that which they would have and the public interest manifest in the Regarding intellectual property rights received had they not been in posses- right to health all the more important. and the pharmaceutical industry, it is sion of a patent. That is the theory and Such a balance was struck, in Bahgat's the third and fourth criteria that are of accounts for the historical develop- view, in the Doha declaration of 2001 paramount importance. Av a i l a b i l i t y ment of intellectual property leading in which the WTO recognized the dan- and accessibility are considered in up to the TRIPs agreement, which, ger posed by the TRIPs agreement to terms of whether there is discrimination Bahgat added, is essentially an organ- public health. From that declaration, between the rural and urban popula- izing mechanism for this process in the Bahgat offered the following quote: tion and between rich and poor. The form a commercial contract. "The TRIPs agreement does not, and key determinant to the satisfaction of should not, prevent member countries both of these criteria is the question of In the real world no argument can be [from] undertaking measure to protect affordability. Hence, in considering the made against the assertion that public health". Indeed, the TRIPs agree- question of intellectual property it is to patents raise the price of drugs. An ment provides sufficient flexibilities for this concern that an organization such inquiry about the degree to which that member states to intervene when a as EIPR must turn. For EIPR, the concern price elevation affects the availability drug is unavailable or inaccessible to a with intellectual property is narrowed and accessibility of vital medication portion of its population – even when to the question of whether its applica- must then be made. The unique char- that inaccessibility is due to expensive tion results in medicine becoming acteristic of medicine as a product – prices of drugs under patent- by pro- unavailable or otherwise out of reach insofar as its consumption is seldom a viding "compulsory licenses" to domes- of those who need it. In the balance manner of qualitative choice but of tic producers to manufacture generic are other concerns such as employ- urgent need – must be made clear. version of expensive drugs still under ment and return on investment, which Bahgat offered to counter some of the patent protection. 36 HISTORY IN THE MAKING

The flexibilities, stressed Bahgat, are not more on marketing than on research industry. Egyptian pharmaceuticals are limited to medical emergencies – but and development. More o v e r, evi- a conservative sector still imbued with to a broadly defined "public health dence from organizations such as the 1960s mentality of import substitu- concern". Yet, these flexibilities as soon "Doctors Without Borders" suggests that tion, which, appropriate then, is out of as they were asserted in Doha came the criteria of return on investments is sync with the requirements of an era of under severe attack from another the primary mover behind the alloca- exposure. The very nature of the indus- o rganization, the World Intellectual tion of resources of such companies. try mandates that the approach be Property Organization (WIPO), a spe- This organization's "Working Group on progressive, that it aim to generate the cialized United Nations agency sepa- Neglected Diseases" concluded that greatest possible value added or oth- rate from the WTO. This organization the most common diseases to the erwise fade to oblivion. Hamed likened i n t roduced Substantive Patent Law African continent receive little or no the Egyptian pharmaceutical industry Treaty (SPLT), a proposed international attention from global pharmaceutical to a lone King piece of chess board, patent law treaty in which the room for industry given the low purc h a s i n g continuously being checked by a vast- maneuver available for the govern- power of its population. ly superior force, moving from one ments of the developing world is great- square to the next hoping only for the ly reduced. Still the SPLT is not the most Ahmad El-Hakim denied the existence most ephemeral stay of execution. In immediate danger to public health in of TRIPs Plus provisions. He was not, 2000, Hamed was summoned by mem- the developing world, but rather the h o w e v e r, aided in his defense by bers of the National Academy for F ree Trade Agreements curre n t l y Professor Mohamed Raouf Hamed of Scientific Research to advise its mem- sought by the United States and a num- National Organization for Drug Control bers on their negotiations of intellectual ber of countries of the South, Egypt and Research who, citing his own stud- property rights with several foreign par- among them. A component of this ies and others, challenged the costs ties. Hamed conditioned his participa- agreement will be legislation on data multinationals claim to bear in the tion on the Egyptian side presenting an exclusivity – the data to which El-Hakim development of new drugs. The figure alternative plan to ignite the domestic had referred to as "undisclosed trade suggested by Hamed is indeed a little p h a rmaceutical sector. When this secrets". This, argued Bahgat, would be less than 10 % of the figure announced demand was disre g a rded, Hamed a deathblow to the production of by multinationals i.e. around 70 million declined to participate – concluding generic medicine. Under data exclusiv- dollars rather than the 800 million stat- then, and now, that Egyptian pharma- ity measures and attendant exclusive ed by El-Hakim. He pointed to the role ceuticals are in a state of "strategic marketing rights, domestic produces in of combinatorial chemistry (the synthe- retardation". the developing world would not be sis of molecules in a combinatorial fash- allowed to assert the clinical safety and ion can quickly lead to large numbers Hamed's damning judgment of local efficacy of generic versions of out-of- of molecules) in exponentially increas- industry brings to fore some of the patent products unless they conduct ing the amount of possible compounds unexamined elements of this narrative. their own clinical trials similar in scope from which new drugs are developed – In considering the state of uncertainty to those originally conducted by the the result is an overstated number of to which Egyptian pharm a c e u t i c a l s multinational. They will not be allowed new compounds to which a firm lays and the masses that depend on them to cite the original drug's approval by claim. The exaggerated claims of the have sunk in 2005, perhaps a more tra- regulatory bodies to produce a gener- technical difficulty in the development ditional consideration of the develop- ic version. Hence even after the patent of new drugs and the inflated costs ment of this industry in Egypt is now in protection is removed the production declared by dominant multinationals is order. One could perhaps account for of a generic version, given the costs of part of an organized effort to construct the odd pensiveness of local drug clinical trials and testing, will become a psychological barrier to potential companies – and the vagueness of the economically unfeasible in the devel- competition from smaller firms in the position of some of the larger firms. A oping world. These measures are now South. Yet, as critical as he was of com- follow up to this seminar must include a part of a “TRIPs Plus” package included panies such Pfizer, and their claims, re p resentative of local industry. It is in all proposed bilateral Free Tr a d e Hamed also criticized the vision – or noteworthy that much of the protest Agreements. They do not only point to lack thereof – on the part of local against the implementation of the TRIPs the medically unethical practice of agreement and the prospective TRIPs conducting test on human subjects Plus provisions has come from the even when the results had alre a d y “... The frequency P h a rmacists' Syndicate and patients been established many years earlier rather than local firms. This anomaly is but amount, in practical terms, to a of commentary on likely to lead us back to the political patent for drugs whose patents had economy of Egypt – and the acceler- already lapsed. the subject [of ated frenzy with which businessmen, who now hold all of key ministerial posts Finally, Bahgat cast doubt of the oft- TRIPS] was such that in government, have veined the exec- made assertion that patent protection utive and legislative apparatus. It may is vital for the funding of multinational's it was indicative of well be the case that the local phar- research and development – an asser- maceutical industry is part of the port- tion he described as a "lazy argument". important changes folio of the very same interests who are The African market, which accounts for now pushing to topple the last remain- little more than 1 % of the global mar- in Egyptian ing chess piece. That is the big picture. ket, would not significantly affect profit Let us now consider the details. margins of multinationals that spend pharmaceuticals...” 37 HISTORY IN THE MAKING

The Chinese Real Estate Boom

Lee Nunley, Economics major, University of Colorado.

ne of the hottest trends in at the economies of other states that estate markets and forms of ownership. real estate investment have undergone similar changes in In the rural areas, private ownership today has become the output, that is to say some of the NICs continued as the normal means of land Chinese urban market. (Newly Industrialized Countries). Let’s tenancy. The cities switched to two There are manifold reasons begin with a brief history of real estate other paradigms of tenancy, neither Ofor this shift in investment but as with and the market in China. w e re private ownership. One was most booms, this one is motivated by e m p l o y e r- p rovided housing, which is one factor: money. With cities like p retty self-explanatory - a person’s becoming some of the most employer owned their housing and in expensive real estate markets in the return the employee paid a small rent, world it is not surprising that foreign and “... Of New Fortune which was hugely subsidized by his or domestic investment is high and that her employer. According to Yanrui Wu new high-rises are springing up all over Magazine’s list of in China’s Consumer Revolution, this urban China. method was extraordinarily inefficient the 500 richest because of issues involving labor mobil- This real estate boom may be ity, retired workers and the subsidies good news for the Chinese economy, Chinese citizens, paid for housing employees ( 1 ). The but it does raise many questions for the other provider of urban housing was developmental economist. With the 94 of them are in the government, which “it is estimated prices of houses rising in cities, can ordi- provided about 15 to 20 percent of nary Chinese citizens still afford to live in the real estate urban housing.” urban centers? Furthermore what sort In the urban centers in China, a series of implications does this real estate business...” of developments in housing re f o rm s boom have for those living in rural took place starting in the late 1980’s a reas? Will the Chinese economy when China was shifting to a more become more dichotomous with soar- market based economy. Most of these ing real estate prices? What role do reforms were aimed at changing from foreign investors and businesses play in employer and state provided housing this real estate expansion? Where does A Recent History market to an individually owned pri- all of the money for the development of Real Estate in China vate property market. of these areas go? Essentially, what is the effect of this boom on ordinary citi- By the mid 1990’s, most of Though it is now possible for zens? And, just as important for the fin- China’s housing in the urban market people to own their own homes in ancier lying dormant inside every had been converted to private proper- China (or at least practically own them developmental economist as for the ty, with some of it going to employees t h rough long term land leases that developmental economist himself, is w h e re employers formerly pro v i d e d allow tenancy on land which is all this boom a bubble? housing and some of it being sold to owned by the state), such was not the public by the state. What these always the case. Private ownership of To answer the preceding ques- market reforms led to was a booming homes in both rural and urban China tions it is necessary to delve into many real estate market. The boom was was legal until the Cultural Revolution periphery aspects of the Chinese augmented by the substantial lack of during the late 1960’s. After the economy. Also, since this boom is still appropriate housing demanded by the Cultural Revolution, a split developed being played out it is important to look Chinese; especially after the market between the rural and urban re a l system took over and helped to 38 HISTORY IN THE MAKING

increase the income of urban Chinese trend is to continue in the future partly in the Chinese real estate market is FDI. citizens. In fact, “the average living because of the government’s desire to Some cities, like red-hot Shanghai have space per capita in urban China develop residential housing. As the even higher FDI versus total investment increased from 3.6 to 7.1 square meters o ffice and luxury apartment market ratios, in Shanghai, 23.2% of money in during the period 1978-92. This figure becomes more crowded, the residen- the real estate market is FDI, up from has increased to 8.5 in 1996.” (2). Such tial housing sector will gradually 8.3% in 2003 (9). a large change over a period of just 18 become the dominant player in the years is significant enough to imply that Chinese real estate market. ”(5) Wu’s With all of these factors and a boom must have occurred After all, a prediction may have just recently start- the possibilities opened up thro u g h three-fold increase in the amount of ed coming true. housing reform it is easy to see how the housing real estate is indicative of sig- Chinese real estate market has gone nificant growth in construction. Rural Other Trends Contributing from non-existent only 20 years ago, to housing, which was consistently pri- the newest trend in international real vately owned throughout the 20th cen- to the Housing Boom estate investment. But the more impor- tury, continued developing while urban tant question, the one about how this housing stagnated due to inefficient Besides housing reform, other recent growth in the real estate sector distribution. In 1996 the average t rends in China’s economy have has affected the Chinese people is amount of housing in rural China was helped to create the current re a l more difficult to answer with historical 21.7 square meters per capita, three estate boom that is prevalent in evidence and data. times the per capita housing in urban Chinese cities. Key to the real estate boom has been the inexpensive mort- China in 1996 (3). gage rates kept low by high savings The Current Boom The reasons for this discrepan- rates in China (45% of income by some estimates). Of course, without the Margaret Pearson put it best at cy are not very well documented in the the beginning of her book China’s New literature on development but one of increase in income for the Chinese citi- zenry the high savings rates that have Business Elite when she wrote, “The the major components is the value of transition from planned to market space in rural versus domestic situa- helped fuel this boom wouldn’t be pos- sible, and for the income to have economy that was initiated in China in tions. Since urban space is limited, the late 1970s unleashed one of the thusly more expensive (in terms of increased so much the economy had to grow at an extraordinary rate. most rapid economic transformations opportunity cost since the state owned ever to have occurred, with changes all the land), it was more effective to Currently, the Chinese economy’s GDP that have spilled over into the social build smaller dwellings, which in the and political realms.” context of the free market China with is growing at a rate of around 8% per higher incomes, were less appealing year, a rate similar to that of South Korea and other NICs during their rapid The implications of China’s for citizens. So part of the housing explosive GDP growth and the accom- development in the early 1990’s (6). This boom is a result of the lag in housing panying changes that re s o u n d size and quality that was borne of the has helped push the average per capi- ta income up over 16% in just the last 10 throughout the Chinese economy are i n e fficiencies of the Communist generally viewed in a good light by regime’s housing policies in urban years. Much of this income has been saved in banks, which has helped to economists, investors, the PRC govern- China. Also private owners in rural ment and the people of China. And areas had incentives to increase home lower the semi-free-floating inter e s t rate to about 5%, near the stated goal growth rates that are as immensely sizes whereas renters in urban areas did high as those that have been pro- not, given that in the long run any of the People’s Bank of China (PBC). This low interest rate has allowed many duced in China for the last 10 years are investment they made would not be certainly reason to celebrate. returned. Chinese to purchase their own homes. In some urban areas home ownership is Especially for those who have made around 60% for newly developed com- fortunes off the expansion - particular- C o m m e rcial real estate was ly the real estate boom. also underdeveloped up until the early mercial housing (7). 1990’s, “non-residential buildings in urban areas have accounted for more Domestic migration from rural than a half of the total floor space of to urban centers has also spurred an buildings completed during 1985- increase in the demand for urban hous- ing. It is estimated that by 2020 up to “... By the mid 1996.” (4) This growth is indicative of an increased business sector in need of 220 million rural Chinese will move to office space, which makes sense given towns and cities (8). 1990’s, most of the privatization of industries during the conversion to a market-based system Foreign direct investment (FDI) China’s housing in in the early 90’s, when the government is also having a serious impact on the privatized 60% of industry throughout Chinese real estate market. With the the urban market the country. The trend of office build- prices of urban apartments jumping by ing has however diminished somewhat as much as 40% per year for some luxu- had been in the last 10 years. “The share of non- ry units, it’s no surprise that foreign busi- residential buildings over the total floor nesses and individuals are investing bil- converted to space completed by the urban non- lions of Yuan into the housing markets state sector in 1995 was less than 50 of major urban centers like Shanghai. private property...” percent for the first time. This declining In fact some 15% of all money invested

39 HISTORY IN THE MAKING

Of New Fortune Magazine’s list of the The new Tomson Riviera tow- in 1998 0.456, in 1999 0.457 500 richest Chinese citizens, 94 of them ers, which are by no means the stan- while the year of 2000 an index are in the real estate business(10). At the d a rd of residential properties in rate of 0.458. same time, “Some researches specu- Shanghai, nevertheless, do represent a late that [the true profit margin] could startling new trend in China. The Second, incessant widening of be 20% to 30%, or even higher,” per Tomson Riviera apartments are the income diff e re n c e s property for real estate developers. For extremely expensive even by the stan- between the urban and rural those invested in the real estate market dards of developed countries like Japan. population. 1990 saw an there was more good news, “China’s At the Tomson Riviera, apartments are income proportion of 1: 2.2 property prices rose by 12.5% [in 2004] priced at around $13,564 per square between the urban and rural …. Among its major cities, Shanghai's me t e r . That means that the smallest population; 1995 a rate of 1: prices grew the fastest, by 19.9%. (11)” apartment available (and the cheapest) 2.71 and 2000 1: 2.79 while the Indeed, there are a plethora of busi- at the Tomson Riviera is approximately $5 year of 2001 it rose to a pro- ness opportunities for the entrepreneur million. At the upper end, prices top out portion of 1: 2.9; in China, and the fact that real estate at $25 million. These are prices in a coun- is the second biggest market in China try where most people earn less than Third, the income differences today, behind manufacturing, doesn’t $1,000 a month(1 4 ) . are expanding from region to seem to be stopping many investors region. In 2000, the average from entering the fray. But for a sub- Disparity is quickly becoming population income in China's stantial number of ordinary Chinese the burgeoning topic of the east was 2.26 times that of the workers it is impossible to even consider Communist party’s concerns on devel- west and it saw a three times purchasing the luxury apartments that opment. Switching to a market based difference between the high- make up much of the gains in the mar- system has enabled the accumulation est and the lowest. (15) ket. of vast amounts of wealth by Chinese capitalists during the economic boom The Chinese government is fully aware The BBC News Online recently that China has been experiencing .This of the problems that introducing a mar- covered the story of Song Yu and his contrasts starkly with the development ket-based economy has created for wife, a prime example of the Chinese of urban unemployment and poverty, China. What are also notable are the who are being priced out of the real and most of all, with the lack of devel- steps the government has taken estate market amid the boom and opment in rural areas. towards reducing disparity, mostly in investments. Economic Disparity the form of policy implementations.

“Song Yu, a physician in a The economic disparity in Regarding urban/rural dispari- Shanghai hospital, and his China, while still not as significant as in ties the Chinese government has taken wife are looking to buy their many less developed countries (LDCs), steps to reduce the amount of money first home. Song Yu earns is growing rapidly. This has forced invested in real estate, which repre- $1000 (£582) a month, which China’s Ministry of Finance to issue sents a large percentage of all gains is more than 10 times the statements regarding the tribulations made by the urban populations over average Chinese salary. that the Chinese economy faces dur- the rural ones. Those policies are also Nevertheless, he's had diffi- ing the process of expansion and meant to keep the Chinese economy culty finding an affordable development. An excerpt from one of from overheating and to prevent a property in the city. ‘Five these statements published in the bubble from forming in the Chinese years ago we looked at buy- People’s Daily follows: real estate market - one that many ing a terraced house for economists fear that this bubble 3,000 Yuan ($371; £216) per Five major problems in already exists. Policies are also going square meter but the deal to be a tough way of making up the fell through,’ he says. ‘Now China’s Income Distribution large difference between urban and that same house costs four rural populations in terms of income. times the price, so we are 1. A ceaseless widening of the Another article from the People’s Daily now looking at apartments gap in income distribution about the discrepancy between urban and the aggravated division instead.’” (12) and rural workers had this to say about of the rich and the poor the year 2004: Similar sentiments are being echoed throughout the country as millions of This mainly manifests in the fol- Chinese experience the hope of own- lowing ways: First, the differ- A c c o rding to govern m e n t ing their own homes being taken ence of the population statistics, the per capita dis- beyond their reach. income in general is getting posable income of urban wider and wider from year to residents stood at 9,422 Yuan Stories like that of Song Yu are year as indicated in the Gini (1,338 US dollars) and the net the unfortunate consequences of real Index, which has alre a d y income of farmers per capi- estate booms all over the world, but in exceeded the standard line ta reached 2,936 Yuan (355 a developing state where the per capi- as internationally acknowl- US dollars), an annual ta income is $5,600 at purc h a s i n g edged. The index rate has increase of 7.7 percent and power parity (PPP), it’s hard to believe seen an increase of 1.62 times 6.8 percent, respectively, in within a span of 10 years with how expensive real estate has real terms. (16) that for 1991 indicating 0.282, become (13). 40 HISTORY IN THE MAKING

While official statistics show that the among those families with This goes back to Wu’s prediction in rural segment of the population’s higher incomes. The families of 1999 that after the commercial and lux- income is increasing at a rate only one 20 percent of population own- ury apartment markets were devel- percent less than that of the urban ing the most financial proper- oped, the mid range-housing sector population’s, there is a significant gap ties accounted for some 66.4 would dominate. Indicators of Wu’s to be made up which the government percent of the total financial trend are starting to be realized by the will be hard pressed to do without properties of the urban popu- Chinese real estate market though implementing policies that would likely lation while the lowest 20 per- there is debate on whether or not the have disparate effects on the GDP cent owning only an average current cooling of the market is just a g rowth created by urban sectors. of some 1.3 percent of finan- slow down or the beginning of a shift in C u r rently, Beijing’s social economic cial properties. the structure of the market. policy, aimed at increasing the income of farmers in rural China who represent The Gini Index shows 0.51 for about two-thirds of the population, is family properties among the restricted to reduced or abolished city dwellers at present in taxes on rural farmers and workers. This China, an index indicating a policy is having an effect, “Per capita much higher than 0.32 the disposable income of urban residents average income of urban and the per capita net income of rural population. (18) residents in China are expected to increase by about 6 percent and 5 per- Increases in disparity of wealth or prop- cent respectively in real terms this year erty in cities is probably caused in large [2005]”(17). To eliminate the disparity in part by the huge increases in property income and wealth however, it would prices in cities during the past 15 years. take more radical policies including Furthermore the government officially wage redistribution which, as stated ended its welfare housing program in above, would have disastrous effects 1998 While there is still housing for the on the Chinese economy. Already the poor, the era of state-subsidized hous- PBC is instituting policies with negative ing for those working in the govern- The China Towers. Courtesy of www.pilotguides.com/.../ c_china_towers.jpg e ffects on the urban middle class ment, public-institutions and national- because of fears of a housing bubble. ized industries has ended (19). Similar Recently the PBC told banks they could moves by private employers have led require a 30% down payment to grant to an increase in the number of people Prospects for the Future a loan, up from 20%, an amount meant seeking housing and some of these to help urban residents purchase their people have become rental tenants. The New York Times recently own homes. Increases in the number of people rent- ran an article that drove home the size ing has contributed to the disparity in and scope of the Chinese real estate Urban disparity in wealth is wealth in cities and towns because the boom. In “China Builds its Dreams, and increasing too and it is proving harder landowning class tends to be dominat- Some Fear a Bubble,” David Barboza for the government to target and alle- ed by a small wealthy group The exis- detailed the true extent of the boom in viate . The Ministry of Finance report on tence of this group in China is con- a manner that makes it more income discrepancy had this informa- f i rmed by the excerpt from the ap p r oachable on a human level, if tion: People’s Daily. Since the price of hous- that’s really possible: ing has increased so markedly in recent 2.Concentration of amassed years more money has been flowing “This year alone, Shanghai will com- wealth is more and more from the hands of renters to the hands plete towers with more space for living increasing with the difference of landlords. Meanwhile the properties and working than there is in all the offi c e of family fortunes tending to owned by landlords have been steadi- buildings in . That is in a become bigger and bigger ly appreciating, thus contributing fur- city that already has 4,000 skyscrapers, ther to their wealth. Concurrently, almost double the number in New Yor k . The latest statistics indicates many Chinese are being priced out of And there are designs to build 1,000 that the 10 percent of wealthy the real estate market and therein shut mo r e by the end of this decade.” families accounted for 45 per- out of some of the gains being made in cent of the total properties of real estate. The sheer size of this real estate boom in the urban population. That of te r ms of pricing and development is the 10 percent families with the There is a secondary problem truly unprecedented, that’s why it’s so lowest income only came to of supply not matching demand in di f ficult to determine whether this is rea l - 1.4 percent of the total proper- many cities as well, which has ly a boom or a bubble. It’s also hard to ties and the rest 80 percent of i n c reased the price of middle and tell where all the money from this devel- the population own 53.6 per- lower range residences. The reason for opment will end up. Certainly much of cent of the total family proper- this is that much of the housing boom it is in the hands of the wealthy Chinese ties. has been oriented towards the luxury investors and entrep r eneurs who got apartment market, while a shortage of into the market early, but will they In the meantime, the financial housing for lower income gro u p s , spend this money in the Chinese econ- property of the urban popula- including segments of the middle and omy or will it make its way abroad and tion tends to concentrate upper middle class, has developed.

41 HISTORY IN THE MAKING

reinforce dualism and the underdevel- nineties. The silver lining for China how- opment of China? That question is the ever is that it has both the experience one that haunts the Chinese govern- of the NICs to study, and a tighter con- ment, in part because some theorists t rol on speculation and investment. believe that the current Chinese The question is whether or not the regime will not be able to maintain Chinese government has done what is power if the newly formed dreams of necessary to prevent the formation of industrialization and the modernization a bubble. of China are unreachable for the majority of the population. After all, it is What Now difficult to justify a Communist state (China actually bills itself as a socialist For Chinese Real Estate? free market state) where there is an increasing disparity in terms of wealth China will continue to be a between a small urban elite and every- major powerhouse in the world econo- one else. my so long as other countries, particu- larly the US, continue to consume its A major concern among goods at an unprecedented rate. But economists and investors are the simi- domestically China still has many issues larities between China and NICs like to deal with particularly the disparity of South Korea and Japan. Writing on wealth that is gaining momentum. “Shanghai’s Cautious Property Buyers”, With that in mind it’s important for the James Cotton had this to say in the Chinese government and central bank Asian Journal of Public Adminstration to keep a watch out for an impending back in 1999: real estate bubble. If the current trends continue however, the market should “Meanwhile in Japan, the The Shanghi Towers. Courtesy of mishuna. realign with the demands of the major- erstwhile power-house of the image.pbase.com/ 34/pnd1/large/313112... ity, i.e. the middle class and lower class regional economy, the investment of surplus funds in real estate had become an engrained habit, a habit them, there are indicators that the cur- which was copied especially rent boom will end just in this way, a “... A major con- in Korea during the re a l bubble bursting, a crash. . According estate boom of the 1980s. to the BBC, housing prices in Shanghai cern among econ- While it was recognized that are down by 10 to 15 percent, and in real estate was not generally some luxury buildings prices are down omists and investors a productive asset, years of by as much as 30%. Moreover, and inflating real estate values perhaps more salient is the fact that are the similarities led investors and banks to “sales volumes are down by 70%”(23). assume that it would always According to some, this decrease is just between China and yield a generous return. This the government’s new policy, aimed assumption was transferre d at preventing a bubble by raising some NICs like South to investments in Asia. This taxes associated with property invest- system unraveled when ment rather than long term home pur- Korea and Japan. doubts emerged that the chases and increasing the interest on loans advanced would be mortgages, but others believe that this Writing on repaid.” (20) is the sign of the end of China’s real estate housing boom because of an There are already murmurs about the outstripping of demand. The concern “Shanghai’s amount of money that banks have is that a situation like that in South loaned to real estate developers. Korea and Japan in the early nineties Cautious Property “Housing loans, including those to will develop and it will cause a major property developers, stood at 2.6 trillion recession, akin to the Asian financial Buyers”, James Yuan (US$310 billion; euro250 billion) at crisis in the late nineties. Here again the end of 2004, accounting for about there is apprehension that a lack of Cotton had this to 15 percent of all Yuan-denominated demand will lead to an excess of loans” (21) and “Currently, commercial vacant properties, which in turn will say in the Asian bank loans account for more than 55% result in a lot of unpaid loans- exactly of all funds raised in real estate devel- what a rapidly developing state with a Journal of Public o p m e n t( 2 2 ).” With so much money dependence on FDI does not want. invested in the housing market re a l Unfortunately for China, there are Adminstration back estate investors can barely afford a set- many similarities between its current sit- back. And the less well off would be uation and what the NICs experienced in 1999...” hurt by a bubble bursting. in terms of financial problems and over Unfortunately for investment in real estate during the late 42 HISTORY IN THE MAKING

The question is whether or not this will create “two Chinas” one rich and one poor, or if it is a sufferable problem that will present itself in any developed “... At the Tomson economy with a large agricultural sec- tor. After all, there is a dichotomy of Riviera, apartments wealth even in the rural versus urban United States. are priced at In terms of a boom, it doesn’t look like China is going to have a around $13,564 per s e v e re bubble on its hands, mostly because of policy implementation square meter. That aimed at preventing one. It does how- ever look like overheated markets, like means that the Shanghai, are going to stagnate for a long while to come. smallest apartment One last thing about the available (and the Tomson Riviera apartments, as of mid- November they had not sold a single cheapest) at the unit. It looks like the endless success of the boom has finally come to an end. Tomson Riviera is approximately $5

million. At the ENDNOTES: upper end, prices 1. Wu, Yanuri, “China’s Consumer Revolution,” Cheltenham, Uk: Edwards Elgar Publishing 1999. top out at 2. Ibid 3. Ibid $25 million...” 4. Ibid 5. Ibid 6. People’s Daily online (17/5/2004) 7. Wu, Yanuri, “China’s Consumer Revolution,” Cheltenham, Uk: Edwards Chinese consumers, particularly as the Elgar Publishing 1999. demand for luxury apartments falls and 8. People’s Daily online (17/5/2004) the return on smaller homes becomes r 9. Edge Malasia (26/10/2005) elatively higher. So long as a loan crisis 10. Ibid is avoided it seems unlikely that the 11. Ibid housing boom will result in any long- 12. “Shanghai’s Cautious property Buyers.” term negative effects for the urban BBC News Online (16/11/2005) 13. CIA World Fact Book Online Chinese. For the time being however, 14. See: “Shanghai’s Cautious pro p e r t y they will have to suffer through the high Buyers,” BBC News Online (16/11/2005) and price of real estate, but the free market Wen, Xue, “Foreign Investors Eye should eventually correct this and cre- C o m m e rcial Properties.” Shanghai Daily ate housing in line with people’s Online (18/10/2005) income. Important in the short term is 15. “Five Major problems in China’s Income whether or not this increase in housing Distribution,” People’s Daily (19/6/2003) price has eroded the standard of living 16. “ China Expecting Rising Income for Citizens, Report,” People’s Daily (7/3/2005) of the middle class Chinese consumer. 17. Ibid There is little information available on 18. Ibid this subject, but it is true that inflation 19. “Preventing a Bubble in China’s Real has been stable at just about 5% and it Estate ” The Edge Malaysia, (17/10/2005). doesn’t seem to be hurting the econo- 20. Cotton, James, “The Effects of the my. For rural residents of China, the Financial Crises in the Mature Asian NICs: housing boom may be more of a har- Enterprise Association and its Modifications.” binger of an increased economic dis- Asian Journal of Public Administration, Vol. , No. 1. June 1999. parity to come. As income in China 21. “China Tightens Lending Rules to Slow increases, it is likely that urban housing Boom,” Associated Press (17/3/2005) prices will continue to increase dispro- 22. “Preventing a Bubble in China’s Real portionately to rural housing prices, Estate ” The Edge Malaysia, (17/10/2005). augmenting inflation and wealth in 23. “Shanghai’s Cautious property Buyers,” urban China relative to rural China. BBC News Online (16/11/2005) 43 IN THE PIPELINE Egypt’s Trade Unions: Reason for Hope * or for Hopelessness?

Jano Charbel, Freelance Journalist

gypt has wit- Nasser’s corporatist mili- nessed the tary regime which trad- l i b e r a l i z a t i o n ed unions’ rights to of certain organize in return for job aspects of security, impro v e d Ecivil society over the wages and working year 2005 which has, in conditions – a new effect, widened the nar - a u t h o r i t a r i a n - p o p u l i s t row margins of civil and social contract was thus political freedoms. In established. most cases these free- doms were seized and This new social contract reclaimed by activists. served in subjecting the Public gatherings, street g r a s s roots nature of demonstrations, and the Egypt’s trade union monitoring of presiden- movement to state con- tial and parliamentary trol and in setting the elections by NGOs and guidelines for future the judges’ club are all manipulation for the novel phenomena that next half century. have surfaced through- Having resisted trade out the year. unions’ /attempts to Facing the odds: workers contemplate the future at the outset of union federate and confeder- elections. Photo by Sherif Sonbol, courtesy of weekly.ahram.org.eg. Egypt’s trade union ate their organizations, movement, however, the military regime final- has not directly benefited from this sequence of the events of 1952 and ly agreed to the establishment of the wave of civil and political freedoms. The have applied since then, notwithstand- Egyptian Workers’ Federation (EWF) in liberalization of civil society has not ing the recent emergence of move- 1957 (2) following the purge of all oppo- translated into the liberalization of the ments such as Workers for Change (an sition forces from the ranks. Nasser had trade union movement which remains intellectual-led labor activist movement been won over to the argument that fettered to the state’s restrictive, inter- and one of several offshoots from the “one hierarchical union structure is less ventionist, and manipulative legislation. Egyptian Movement for Change or of a threat than many small ones since it Egypt’s trade unions continue to be Kifaya/Enough) and Railway Workers for is easier for the government to keep dominated by the state and by the Change (a movement organized and undesirable elements out of a single National Democratic Party’s agents in led by railroad workers). confederation, and since a handful of the govern m e n t - c o n t rolled Egyptian leaders is easier to manipulate than Trade Union Federation (ETUF), which is Civil society fell victim to the 1952 mili- m a n y ”( 3 ). Since 1957, Egypt’s trade the only trade union confederation tary coup, and has stagnated for over unions have been contained within the fifty years under emergency law. allowed for by law(1). All unions must confines of a single top-down oriented affiliate to the ETUF, and cannot organ- Political parties, NGOs, professional syn- power structure. In 1961, ETUF was ize themselves independently outside dicates, and trade unions all lost their founded as the successor to EWF, and the framework of the ETUF hierarchy. independence. In the case of trade inherited the same centralized organi- These restrictions came about as a con- unions, the freedom to independently zational hierarchy. organize their affairs was smothered by 44 IN THE PIPELINE

and appointments. Workers at the Services, “not a single strike has ever base of the hierarchy may only vote for been authorized by any of the general “... ETUF is not a their own local union council; beyond unions; and the provisions of the law this level they have no say (4). guarantee that no future strikes will federation of trade ever be authorized by the NDP-domi- Egypt’s legislation on trade unions con- nated general unions.” unions, but rather a tradicts with its obligations according to international treaties which the state Despite the ban on unendorsed strikes, pyramid-shaped willingly signed and ratified. Many of a large number of “wildcat strikes” – viz. the provisions of Egypt’s labor laws and those unauthorized by general hierarchy by which trade union legislation are in direct vio- unions/federations – occur each year. lation of the ILO conventions including The most notable in 2005, were the the NDP-controlled those concerning the Right of ESCO Textile workers’ strike (13), the air Association & Combination of traffic controllers’ strike (14), the metro leadership at the Agricultural Workers ( 5 ), F reedom of workers’ strike ( 1 5 ), and the To r a h Association & Protection of the Right to Cement workers’ strike (16). pinnacle of the O rganize, the Application of the Principles of the Right to Organize (6) & Other forms of workers’ protests, apart pyramid manipu- to Bargain Collectively (7), Protection & from strikes, included the Alexandria Facilities to be Afforded to Workers’ Port workers’ sit-in protest (17) and the Representatives in the Undertaking(8), Ura-Misr Asbestos workers’ pro t e s t( 1 8 ). lates the base and and Tripartite Consultations to Promote A c c o rding to the statistics of the keeps it in-check the Implementation of Intern a t i o n a l Center for Trade Unions’ & Workers’ Labor Standards(9). Egypt’s legislation is Services, nearly 100 other cases of according to the also in direct breach of article 8 of the strikes and workers’ protest have International Covenant on Economic, occurred throughout 2005 (19). Social and Cultural Rights (10), and of guidelines and article 22 of the International Covenant There were other acts of defiance by on Civil and Political Rights (11). workers and unionists who have policies of the attempted to organize themselves as Egypt’s domestic legislation also independently as possible from the ruling party...” restricts the freedom of association, ETUF structure. Redda Arabi, a notwithstanding the responsibilities to spokesman for the Railway Workers for which it committed. For example, Change claims, “we established our Today, the nationwide hierarchy of according to Trade Union Act 35/1976, movement in July (2005) following unions is based on a three-tiered pyra- workers may not organize unions, fed- Prime Minister Ahmad Nazif’s mid-shaped structure composed of erations, or confederations outside the announcements regarding plans to pri- approximately 1,900 local unions at the realm of the official ETUF structure . vatize certain sectors of the railways. base, with twenty-three general Furthermore, other regulations stipulate We know that the unre p re s e n t a t i v e unions/federations in the middle, and a that a minimum of fifty employees are and unresponsive Railway Wo r k e r s ’ confederation council at the summit of required in order to establish a local Federation shall not assist us if privatiza- the structure. The ETUF has total of union council. This prohibits many work- tion becomes a future reality.” Arabi about four million members (most of ers, in the private and informal sectors, added “The Federation and the ETUF whom are employed in the public sec- from the ability to organize (12). are merely a façade for an organized tor). gang which seeks only its personal ben- The right to strike, although it is allowed efit; this dysfunctional system responds Labor affairs expert, Rahma Refaat, of under articles 192-201 of Unified Labor only to the requests of the NDP and its the Helwan-based Center for Tr a d e Code 12/2003, is practically impossible affiliated businessmen. It neither sees Unions’ & Workers’ Services, arg u e s to exercise. To begin with, a total of nor hears us.” “ETUF is not a federation of trade fourteen out of twenty-three general unions, but rather a pyramid-shaped unions and their constituent local hierarchy by which the NDP-controlled unions which are engaged in strategic leadership at the pinnacle of the pyra- and vital enterprises (including bak- mid manipulates the base and keeps it eries, public transport, public utilities, “... not a single in-check according to the guidelines and pharmacies, amongst a host of and policies of the ruling party.” others) are forbidden from striking under any circumstances. strike has ever The provisions of Trade Union Act been authorized by 35/1976 and 12/1995, together with Those unions falling under the nine those of Labor Law 137/1981 and remaining general unions which are any of the general Unified Labor Law 12/2003, govern the allowed to strike may do so only if the powers and functions of the unions. respective general union authorizes a unions...” Article 37 of Trade Union Act 35/1976 strike by a two-thirds majority of the stipulates that federation and confed- general union council. According to eration councils are to be chosen Kamal Abbas, the director of the through a series of indirect elections Center for Trade Unions’ & Workers’ 45 IN THE PIPELINE

Throughout the month of May 2005(20) p roduced a number of unfore s e e n 8. (ILO Convention No. 135 - Ratified by the “Workers for Change” movement results (21). Similarly the 2006-2011 trade Egypt as of 03/25/82) 9. (ILO Convention No. 144 - Ratified by raised demands regarding the right to union elections (22) may also hold a Egypt as of 03/25/82) establish a new trade union federation number of unexpected surprises (23). 10. (Egypt’s signature of the ICESCR: independent of state interference and 08/04/67; Ratification: 01/14/82) free from the Labor Ministry’s intrusions. 11. (Egypt’s signature of the Signature : The then Minister of Labor, Ahmad el 08/04/67; Ratification: 01/14/82) Amawi, and the President of the ETUF, “... one hierarchical 12. This requirement may be considered pro- al-Sayyed Rashid, however, openly hibitive in comparison, for example, to the rejected this demand on the basis that union structure is situation in the UK and in a number of it would divide the national trade union Commonwealth states where the old provi- movement. sion allowing any seven persons to form a less of a threat than union is still in force. World Labor Report (Geneva: International Labor Office, 1985) Rahma Refaat, is of the opinion that “a many small ones p. 11 small number of independent unions 13. Lasting from March – August 2005, and may be more valuable than a large involving 400 workers protesting the privati- number of unions which are organiza- since it is easier for zation of their factory tionally paralyzed. Compare the few 14. May 2005 – involving 150 controllers in autonomous unions that existed prior to the government to Cairo International Airport demanding pay 1952 with the many ineffective unions raises; the strike wave spread to other air- keep undesirable ports including of today. “The number of unions is not 15. November 24, 2005 – involving hundreds an indicator of their quality.” Refaat of metro workers demanding the release of added that “the establishment of elements out an imprisoned co-worker unions that are organizationally inde- 16. Ongoing since December 13, 2005 – pendent of the ETUF and/or the cre- of a single involving 2,000 cement workers demanding ation of a new autonomous union con- a more equitable share in profits federation are currently unlikely, how- confederation, and 17. October 23 - 25, 2005 – involving over ever. There are no political parties 3,000 workers demanding their annual Eid since a handful of bonus which had been cancelled demanding union independence, and 18. September 2004 – September 2005 unionized workers are usually too –involving fifty-two workers pro t e s t i n g caught up in the grind of their labor to leaders is easier to against unpaid wages, the loss of three co- strategize for the creation of new fed- workers to cancer and asbestosis, and erations. Thus, there is virtually no pres- manipulate than numerous maladies amongst the remaining sure being applied on the state to alter workers. the status quo, nor are there even many...” 19. Strikes, protests, and other cases of work- demands for parliament to draft new ers’ unrest are usually not covered by the official Egyptian media – whether TV, radio, trade union legislation in place of or printed media. If covered, they are usu- 35/1976.” ally condemned. END NOTES: 20. The demands for the establishment of a What then is the forecast for Egypt’s new independent trade union federation * The contents of this article are based pri- were first raised at a demonstration in front unions? Currently, with privatizations marily on the findings contained in Jano of the Journalists’ Syndicate on May 7, 2005. and early retirement programs in effect T h e o d o re Charbel,Trade Unions & Most of those raising the demands were since the 1990s, the booming private P rofessional Syndicates of Contemporary intellectuals, professionals, and labor and informal sectors of the economy Egypt: Regulations, Rights and Vi o l a t i o n s activists – only a minority of those present (The American University in Cairo , employ about 75% of Egypt’s work- were actually blue-collar workers. Department of Political Sciences: MA Thesis, force while public sector’s share has 21. Including the victories of eighty-eight February, 2005) shrunk to nearly 25%. However, nearly Moslem Brotherhood candidates 1. Specifically by Trade Union Act 35/1976 75% of the existing trade unions are 22. Due to be held in October-November 2. The Egyptian Workers’ Federation was 2006; the Minister of the Labor Force is to those organized in the public sector. founded one year following the establish- determine the exact dates of the elections. ment of the International Confederation of 23. Historically the Moslem Brotherhood has Khaled Ali, a lawyer with the Hisham Arab Trade Unions in 1956 which was head- not been a significant force within the trade Mubarak Law Center, claims that the quartered in Cairo until 1978 – the new union movement – although the I C ATU headquarters are based in c u r rent dynamics of Egypt’s trade Brotherhood is certainly a major force within Damascus, Syria. union movement are leading towards the realm of professional syndicates. It may 3. Posusney, Marsha Pripstein: Labor and the a situation where “there are unions be far too early to speculate about the State in Egypt: Workers, Unions, and without workers” in the upper echelons results of the upcoming union elections. Economic Reconstruction, (New Yo r k : of the ETUF structure by virtue of priva- Columbia University Press, 1997) p. 67 tizing the public sector, and “workers 4. In contrast to professional syndicates’ without unions” in the private sector. elections in which members are able to vote for their regional syndicate councils as well In a surprise result al-Sayyed Rashid, as for their general syndicate council. president of the ETUF and of the Textile 5. (ILO Convention No.11 - Ratified by Egypt Workers’ Federation, and a labor MP as of 07/03/54) since 1990, lost his bid for a seat in the 6. (ILO Convention No. 87 - Ratified by Egypt as of 11/06/57) 2005-2010 Parliament. The re c e n t l y 7. (ILO Convention No. 98 - Ratified by Egypt concluded parliamentary elections as of 07/03/54) 46 BUSINESS NOT AS USUAL Traditional Crafts an untraditional source of income

Karim El-Sayed, Young Scholar, EBHRC

“The life of my family now hangs by the thread I embroider” – Ramba Behn, Dastkar Society for Crafts, Rural India.

ith the abolition of creative means to turn uneconomical they argue that many of the problems most state-sponsore d public enterprises that they acquired plaguing the vast majority of the world development projects through government-sponsored priva- population, like illiteracy, poor access in the less economi- tizations into profitable ventures, but to health services, unemployment, cally developed the most common recommendation even racial unrest, are mere manifes- Wcountries, the burden to satisfy the made by global consultancy firms is to tations of that reality. Income generat- needs of the world poor and marginal- cut down on unnecessary costs and to ing activities, therefore, become a key ized came to rest on the shoulders of lay off staff employees. This means that element in triggering the development the civil society org a n i z a t i o n s . hundreds of thousands of able-bodied process and ensuring the empower- Development agencies and volunteer employees lose their livelihoods; those ment of marginalized communities. organizations faced the challenge of are also joined each year by files of P rofessor Muhammad Yunus, “the filling the gap between the demands f resh graduates whose education inventor of micro-credit”, developed of an ever-increasing population in the does not qualify them for a position in an income-generation framework that developing world for employment and the capital-intensive business environ- comprised “giving tiny loans … to the social services and the shrinking efforts ment. poorest of the poor in rural Bangladesh provided by their governments. without any collateral” to assist entre- While some of the civil society and preneurs who could not qualify for tra- Those governments’ concessions to non-governmental organizations that ditional bank loans to start their own the World Bank’s incessant demands evolved in the developing world p rojects. This system, which is now for re f o rm and restructuring meant attempt to fill the void created by the known as the Grameen Bank model, that the meager budgets pre s e n t l y government’s withdrawal by providing has five million borrowers in allocated for subsidized education subsidized health services and basic Bangladesh alone, and Pro f e s s o r and health services are insuff i c i e n t . education programs, an incre a s i n g Yunus has helped export his model to I n c reases in the cost of delivering number of NGO’s have turn e d dozens of other developing countries. those services often mean that the towards income generating activities The Social Fund for Development in quality of the services provided con- as a more sustainable solution to that Egypt, which operates under the stantly declines not to mention that p roblem. The direct link between direct supervision of the Prime Minister the number of people benefiting from income growth and development is and under the umbrella of the United those public plans falls due to budget debatable in development discourse; Nations Development Pro g r a m m e limitations. More importantly, the dis- nonetheless, many people still share (UNDP), works closely with NGO’s to mantling of the ambitious public sector the viewpoint that the vast inequality finance small and very small enterpris- cost many people their sole source of in income distribution is the crux of the es and projects adopting the income. Private investors strive to find development question. In addition, Grameen Bank model.

47 BUSINESS NOT AS USUAL

“... While some of the civil society and non-govern- mental organiza- tions that evolved in the developing world attempt to fill the void created by the government’s

withdrawal by pro- “Fair Trade Egypt aims to empower local communities by offering disadvantaged arti - viding subsidized sans marketing and support services” (Courtesy of Fair Trade Egypt Online). was the “Craft as a window to job the seasonal migration of large numbers health services and opportunities for the poorest youth” of Egyptian workers and farmers to the project championed by the UNESCO Gulf countries strongly influenced the basic education under their ten-year plan for the taste of the Egyptian village, and detri- Development of the Crafts in the World mentally affected the livelihood of programs, an (1990-1999). This project sponsore d many artisans. Those who had not young craft workers, especially women, adopted the western taste could not increasing number to receive formal training “to enhance fight the temptation of the superior their skills in producing and marketing quality of the machine-made utensils of NGO’s have traditional crafts” with the objective of and factory-produced linens and tex- “using creativity to alleviate poverty … tiles making local crafts a thing of the turned towards [and] to enable the youth to generate past. The philosophy of Fair Trade Egypt their own income”. Grameen Uddog is attempts to counter that trend. Fair income generating another example; this initiative com- Trade is a concept in trading practice bines the micro - c redit system of the that was conceived in the Netherlands activities as a more Grameen Bank with an objective to pre- 50 years ago and represents an alterna- serve handloom techniques of produc- tive trade movement which attempts to sustainable solution ing textiles and rugs. Rural communities empower local artisans from the devel- have traditionally used their craft skills to oping world “[by ensuring] that at the to that problem ...” supplement their incomes, especially very least 25 to 30 percent of the net during times of lean harvests. Traditional profits go back to the artisans them- crafts do not require expensive invest- selves”. Fair Trade Egypt, a non-profit ments in capital goods or infrastructure o rganization, is the local chapter Today, micro-credit borrowers venture and can be produced using material among more than 200 members world- into almost every conceivable business from the environment and skills that are wide all working under the auspices of sector, even software development and passed through the generations. I n t e rnational Fair Trade Association telecommunication enterprises. The (IFAT.) It proclaims “[their] goal is to assist majority of the micro-credit entrepre- The early 1990s witnessed the infiltration the talented but struggling Egyptian arti- neurs, however, continue to favor the of the consumerist culture into almost sans, who have been particularly hard- traditional sectors for their projects. This every corner of the world; with the fall of hit by massive industrialization and glob- can be attributed to the fact that the state-capitalist regimes in Eastern alization … by safeguarding techniques early beneficiaries lived in rural areas Europe and Asia and the spread of tele- and products that were on the brink of where the micro-credit system was first vision broadcasting and advertising to extinction because of their mass-pro- i n t roduced, but it could also be the remotest villages. Mass-scale pro- duced counterparts”. because there was a trend to docu- duction quickly replaced utility items ment and preserve traditional crafts at that were made by local artisans for The last decade has witnessed the evo- the time the Grameen Bank experiment daily use. In Egypt, this process started a lution of other agents who have been began. The two schemes were soon little bit earlier. The relaxation of the active in preserving local crafts, without married. One of the projects that exem- trade laws in the late 1970s allowed for so much of the “non-profit” dimension. plify how income-generation activities the introduction of foreign luxury goods Nagada presents itself as “a company were closely linked to traditional crafts and western taste. More importantly, for design and crafts”.

48 BUSINESS NOT AS USUAL

p roduction for home consumption, has influenced the development strate- which used to be the only outlet for tra- gies. Asala is an NGO concerned with “... the designers, ditional crafts, is quite different from the preservation of traditional and con- c o m m e rcial sale. There f o re, they temporary art forms, and through a also in an effort to emphasize that “traditional craft skills, grant from the Agha Khan Foundation, however beautiful, needs sensitive they designed a project for the training appeal to the adaptation, proper quality control, cor- of 80 young artisans. Mr. Seif il-Rashidi, rect sizing and accurate costing”. Executive Director of the training proj- consumers’ taste, When it comes to the creative process ect, pointed out that the primary of design, however, they remain quite objective of the NGO is to target a spe- have intervened in adamant about preserving the free- cific segment by marketing the prod- dom of the artisan. They question the ucts abroad and in tourist bazaars. the indigenous problematic role of “the designer” and Similarly, the December 2005 issue of even that of “the client”. Whose taste Cairo Agenda, a monthly publication creative designing should the final product express? That addressed primarily to the expatriate of the consumer “who wants an excit- community in Egypt, chose Siwa process and have ing product at the most competitive Creations as their pick of the month. A price” or the artisans “who need a mar- shop in Zamalek that “gives you the introduced their ket for [their] product as similar to the opportunity to buy a variety of exquis- traditional one as possible, so it does itely embro i d e red textiles and finely own new motifs to not need constant alien design inven- crafted jewellery locally made and tions, or conflict with the traditional i n t e rnationally desired”. The business the textiles...” social, aesthetic and cultural roots it venture employs Italian fashion design- has sprung from”. Significant efforts also er Ermanno Scervino who designed the go towards the documentation of not collection of jewellery, clothes and bed only the production process but also f u rnishings. The designer “commis- The business venture, which gets its the traditional design process and the sioned workshops in Siwa to perform name from a small village on the east developments introduced. They are the intricate embroidery for his new col- bank of the Nile between and building an archive of photographic lections” which are marketed in inter- , has a showroom in Dokki, and is design and product re f e rence with national fashion magazines around the involved in “textiles, fashion, soft furnish- actual samples of the traditional prod- world. The pictures of runway models, ings and pottery”. Michel Pastore, a ucts. accompanying the article, fail to Swiss artist, was sponsored by the prompt any connections with Siwa. Canadian government in 1991 to study M o re importantly, Dastkar does not the feasibility of developing the textile have any qualms about being involved We can save the purely intellectual and weaving practices of the artisans in “a commercial activity like market- debate about cultural imperialism, the of Nagada, which have been constant ing” in order to assist the artisans in infil- exploitation of native cultures for mon- for over a thousand years. The trating the market. Their stance on posi- etary profits, and the negative effects Canadian project lasted for only one tioning or marketing the traditional of the commercialization of those year. Pastore, however, partnered with p roducts, however, remains quite native cultures on the identity of the Sylva Nasrallah, a Lebanese fashion steadfast. Since they operate with the people themselves for another forum. d e s i g n e r, and formed a company mindset that traditional artisans pro- But on a more grounded note, it is very under the same name of the duced utility goods that could com- unclear how much of the profits actual- C a n a d i a n - s p o n s o red project. They pete with mass-produced goods in ly go back to the artisans themselves work on improving the quality of the fin- terms of quality, prices and functionali- with the popularity of Fair Trade proj- ished goods and the production tech- ty, they strongly oppose the idea that ects which market themselves by the niques to be more attractive to the “craft should be purely decorative” uniqueness of the traditional crafts. consumers. Unfortunately, however, the and they find “the current much-used designers, also in an effort to appeal to terms ‘exclusive’ and ‘ethnic’” as mis- the consumers’ taste, have intervened leading and inappropriate. In order for in the indigenous creative designing the traditional crafts to survive and process and have introduced their own maintain a sustainable track of devel- new motifs to the textiles. opment, the motivation should be to deliver those goods to a much bigger Dastkar (one who works with his hands: consumer base than just the tourists or artisan or craftsperson in the Hindustani the urban elite who find them “exotic”. language) is the name of a registered society that “aims at improving the This, unfortunately, is not the approach economic status of craftspeople there- used by Egyptian agents. An article in by promoting the survival of the tradi- the 16th of November 2005 issue of il- tional crafts”. Six women founded the Masri il-Yum, entitled “il-Khiyamiyya: an society in 1981, and today it has full- Egyptian creation only the foreigners fledged craft development activities all respect”, does more than just tell the over India. As the name of the society well-known story about the art form suggests, and as they often assert, the that came to rely solely on tourists; but emphasis of their activities is on the arti- it also shows how much that mindset san and not the craft. They admit that 49 RESEARCH IDEAS

The Laws of Competition The Debut of Antitrust Legislation in Egypt; A Proposal for a Comparative Study

Dina Waked, LLM candidate, Harvard University

fter more than a decade of debate, Egypt passed In order to assess the implementation its first antitrust law on 15 “... Egypt has been of antitrust law in any country, one must February 2005. As of the consider the implementation of the law 16th of May 2005, the law anticipating the as the foundational determinant of the Ahas come into force. Policy makers way it will impact on an economy. In argue that this law should take Egypt to antitrust law for order to investigate the implantation a new regulatory era where competi- mechanism one must look towards the tion is protected and superiority in the competition agency/authority respon- market is the outcome of commercial almost a decade sible for implementing the law. Here is and technical creativity, and not the where the newly passed antitrust law is result of anti-competitive conduct or and a lot of debate most intriguing, hence the focus on the s t r u c t u re. Many economists, lawyers, Egyptian Competition Authority-- here- and perhaps the entire business com- has surrounded the inafter called “Authority”--that is creat- munity were wondering when this long- ed as the regulatory body supervising awaited, overdue law would finally issue of whether the the implementation of the law and its pass. Most developing countries by the procedural enforcement mechanism. mid-1990s had adopted antitrust laws law will actually Article (8) of the Law no. (3) Ofof 2005 and Egypt continued to lag behind. for Protection of Competition and However, it is important to note that promote or discour- P revention of Monopolistic Practices p rotection of competition was not establishes the competition agency as absent from the Egyptian legal domain age investment...” “a public corporate body. […] [that] since various provisions in the civil and shall report to the appropriate minister criminal code deal with the anti- who shall [in this case] be the prime- monopoly in one way or the other – of Pareto efficiency. The most intriguing minister.” The agency, which shall play this, importantly, was never under the characteristic of antitrust law is that an a pivotal role in regulating markets and auspices of an antitrust umbrella. economy can regulate the direction of enforcing law, needs to be independ- its market within the extremes of laissez- ent and impartial in order to be able to The new legislation has been intensely faire with minimal government inter- undertake such regulatory functions. debated, both in support and con- vention on the one hand, and in However, there are doubts concerning demnation, while it was still a draft law planned economies with state involve- its true independence from the state and after it became adopted by par- ment in the form of dosages of antitrust given the fact that it is a public body liament as law. Fuelling the debate is a applications on the other. The argu- that reports directly to the Prime g rowing understanding that antitrust ment hence is that antitrust legislation is Minister, who in turn appoints its own law is a cornerstone in any economy the backbone of any legal ord e r board of directors,(Article 8) Moreover, whose administrators wish to guaran- designed to regulate a market and it could represent an inherent flaw in tee the efficient allocation of resources a s s u re an effective welfare system the regulatory structure proposed by and its operation within the boundaries where market failures are prevented. the law. However this specific relation 50 RESEARCH IDEAS

with the executive branch is implied in retically anticipated the outcome thus enforcement procedures. The aim of the Egyptian constitution, which taking more or less hypothetical any comparison is to investigate the re q u i res any body to be politically approaches in analyses. Since the law differences between the US, EU and responsible in front of Parliament. In its has passed and its repercussions are the Egyptian antitrust law with special t u rn, the Parliament re q u i res that a currently available for assessment, it emphasis on the procedural enforce- member of the government (i.e. the offers some ground to start a thorough ment mechanism of the agency and Prime Minister, his deputy, the ministers, analysis of the topic. Nevertheless, to asses whether these diff e re n c e s their deputies, etc.) must oversee this since the outcome of the law cannot affect the economy differently. In other body, since only government members be yet fully assessed, some parts of the words, a comparison will illuminate the are politically responsible in front of analysis must follow the same differences in terms of economic per- Parliament. Thus, to assure the compli- approach undertaken by the preced- formance that result through the adop- ance with constitutional requirements ing writers on this specific topic. tion of different systems of regulation. this formation of the competition Taking into consideration the issue of authority has taken shape. The law In order to draw conclusions about the comparability, other developing coun- excludes the direct intervention of the impact of the law, its study cannot be tries that have adopted antitrust laws judiciary in enforcing the antitrust provi- restricted to Egypt. It must entertain a should be compared to Egypt as well, sions, in cases of violations, by allowing general view of how the structure of in order to be able to conclude only the Prime Minister to raise the vio- the competition authority and its regu- whether the adoption of antirust laws lation to court. It restricts the agency’s lation affects the investment and eco- had a positive or negative effect on punitive enforcement mechanism and nomic atmosphere in different coun- the economic perf o rmance of their prevents recourse to private litigation. tries. To offset the drawbacks attributed country and whether differences in the Again, this is a result dictated by the to hypothetical analyses, one must use competition authority’s enforc e m e n t Egyptian constitution where no punitive a combination of a Policy Analysis and mechanism had any role to play in damages or fines may be enforced by a Comparative Approach. Perhaps it such differences or similarities between any other body than the Egyptian would be rewarding to look into the US respective countries. courts. Thus, a question that arises in this antitrust law and compare the proce- respect is not only the independence dural enforcement mechanism of the Summarizing the questions raised by of the agency but also the balance of competition authority in the US to the this article, the study must focus on the power between the judicial and the one established in Egypt. Moving on procedural aspect of the competition executive body in implementing the from there, one should look into the EU agency established under the newly regulations set forth in the adopted antitrust law and compare it to its passed Egyptian antitrust law and to antitrust law. As can be seen from the Egyptian counterpart with respect to assess, through a comparative study, wording of the law, the competition to what extent this specific enforce- agency reports directly to the execu- ment mechanism of the authority will tive body, hence excluding the judici- “... Many affect an efficient implementation of ary from the supervision of the imple- the law in Egypt. mentation of the law. economists, In order to do so, the following ques- An analysis of the impact of this lawyers, and tions play more than a guiding force for e n f o rcement mechanism of the the research in general: Is the Egyptian authority becomes crucial to deter- perhaps the antitrust law in line with the bench- mine the extent this structure is expect- marks set by the advanced economies ed to affect the regulatory approach entire business and the Model Competition Law? How of the authority. In other words, one does the Egyptian antirust law com- must consider whether this specific pro- community were p a re with the emerging markets cedural enforcement mechanism dic- antitrust laws? Is the lack of punitive tates a certain type of regulation that is wondering when powers a fatal problem? Is there some- different from that adopted by other thing wrong with the Egyptian antitrust competition agencies. It would also be this long-awaited, law’s enforcement mechanism of the rewarding to analyse whether this law, antitrust authority? Does the minimal especially with the current structure of overdue law would role granted to the judiciary have any the authority, would not merely substi- effect on the implementation of the tute the direct intervention of the state finally pass. Most law? If yes what are they? What could that prevailed in earlier decades with a be the effect of these differences/simi- new system of intervention disguised developing larities? Do these similarities/differences under the mask of the current antitrust prove that developing countries need law; i.e. whether the antitrust law of other antitrust laws than developed Egypt sets up a regulatory system that countries by the world countries? Is development corre- only serves to mask a revisited state lated with the antitrust law? Is there evi- intervention. This is an important investi- mid-1990s had dence that these are questions that gation, especially as Egypt has been the current administrators and legisla- anticipating the antitrust law for almost adopted antitrust tors have posed before passing the a decade and a lot of debate has sur- law? What are the implications of the rounded the issue of whether the law laws and Egypt answers of such questions? will actually promote or discourage investment. continued to lag *This article is part of the author’s LLM thesis proposal. The literature on this topic has theo- behind...” 51 BOOK REVIEW The Story of an Arab on Wall Street The biography of Alwaleed Bin Talal

Wael Ismail, Project Officer, EBHRC

t is hard to review a biography. Biographies are about human lives and real people. Their appeal to the reader is due to their ability to make certain people more accessible. The degree of accessibility Iand accuracy will usually change from one biography to another depending jointly on the subject of the biography and its author. In 2005 Riz Khan, former CNN journalist, added a new biography to this ever expanding and changing form of writing in the book, titled, Alwaleed; Billionaire, Businessman, Prince.

The seventeen chapter book is supposedly an attempt to bring to light the elusive figure of Alwaleed to both Arab and international read- ers. Alwaleed according to Khan is one of the less known members of the notorious Forbes’ 10 richest men list. Unlike individuals, like Bill Gates or Warren Buffet, Alwaleed is not that widely known to the general populace. Khan’s interest in Alwaleed supposedly began in 2002 when he met him for an interview, but then things pro- Book: Alwaleed; Billionaire, g ressed to the current book, which is also Businessman, Prince accompanied by a documentary. The book is Author: Riz Khan hardly just an attempt to bring to light one of the Publisher: Harper Collins world’s richest men, but is actually more like a presentation of the credentials of Alwaleed to a Arabic Translation: Arab Scientific Publishers vast audience. 52 BOOK REVIEW

The book reconstructs Alwaleed’s life can not be kept out of the equation. through the author’s observations and Unfortunately, Khan only mentions the testimonies of his closest friends, them in passing; maybe in anticipation family and business associates. The out- of just such criticism.As a an example, “... former CNN come of the compilation of these vari- the picture at the back of the book ous accounts make the biography a shows the prince leading heads of vari- journalist added a rather dull text to read. Alwaleed’s life ous Arab states, Hosni Mubarek (Egypt), was turned into his daily routine of wak- King Abdullah (KSA), King Abdullah new biography to ing up and going to sleep and every- (Jordan), Mahmoud Abbas (Palestine), thing in between. Such details might and the president of the United States. this ever expanding have been what the author considered This prestigious status is a right of his to be essential observations of his sub- royal standing and not something that and changing form ject’s lifestyle that might reflect how money can easily buy. Alwaleed’s con- hard the prince works. That is not, how- nections are a central component of of writing in the ever, what generally attracts readers to his success story. The fact that he such a book. It is worth noting that refused to be just another Saudi royal book, entitled, other chapters dealt with Alwaleed’s dependent on oil revenues does not family ties and relationships, but the negate this fact. Alwaleed; Billionaire, statements made were put in a rather general form without touching upon The biography of Alwaleed Bin Talal, Businessman, anything particularly peculiar in the only Arab to make the Forbes 10 Alwaleed’s character. Khan attempts richest men in the world list could have Prince...” to truly glorify the character of the been produced with better craftsman- prince, an attempt that really causes ship. However, it sill remains an insight more harm than good. into the life of one of the world’s richest history accounts will not only help us men;a window into the life of a Saudi learn more about firms and the business Through out the book, Khan wanted to businessman who is currently the community, they will help us better plan underline the fact that the prince was a biggest foreign investor in the US. The and formulate economic policy. If self-made man, which is true to a large life of Alwaleed, further highlights the economists truly understand the agony extent, but his ties to the royal family fact that business and politics at the of a father with children caught in a end of the day are two faces of the recession without work, they will no same coin, this could not be more longer use with ease certain market apparent than when Alwaleed’s contri- economy jargon, where the invisible “... The book bution to the city of New York after 9/11 hand will work its charm yet again. The was rejected by its mayor due to some role of scholars hence lies in producing reconstructs of Alwaleed’s statements about US for- more biographies, using more accounts eign policy. based on the reality that lies there out- side our window, not buried deep in Alwaleed’s life Biographies such as Alwaleed help us libraries in remote and inaccessible better understand the mentality of busi- places. It is amazing how we write through the author’s nessmen or, in purely gender free bias, about our past without taking into business agents. The ability to truly account the people who lived in it. observations and understand how these people think People of all status, central and mar- and act is paramount to understanding ginal, should be brought back to the the testimonies of the ways firms operate especially in an rightful places at the heart of any his- age where firms are literally playing a torical exercise. his closest friends, larger than life role. In this matter, life his- tory accounts, whether through biogra- family and business phies, autobiographies or oral history Alwaleed remains a biography with its records, will take center stage. Each of flaws, but one that can truly tell us associates. The these forms has to be taken of course something about an era of business with its own pinch of salt. Such records expansion in after the oil outcome of the are not the Holy Grail that will easily tell boom, the reaction to the reversal of us how or why firms operate or act the this boom, the role of multinational compilation of way they do. But they will help us make companies in the Saudi economy, and more informed and educated conclu- the role that the royal family can play in these various sions and create assumption based on enhancing the life of its subjects away reality rather than fiction. from the king and his heir. The biogra- accounts make the phy is filled with untapped topics that In a field like business history and its larg- could have been explored in a much biography a rather er context, economic history, individu- deeper way, with the prince at its cen- als have for so long been kept out of ter stage. However, for the time being dull text to read....” the literature. It is about time that we at least, we have to settle for an inter- bring them back in again. The use of life view that ended up being a book.

53 OUR ARCHIVES

he following are samples of the documents contributed to EBHRC to be part of its archival depository. Donors of documents vary ORAL HISTORY Tfrom individuals to institutions. In addition documents received RECORDS: vary from original to copy forms and some old documents were pur- chased from a collector of old papers and artifacts in downtown elow is a list of EBHRC’s oral Cairo. Donor name followed by a description of the documents will history interviewees. The list be found below: B excludes the interviewees of theYoung Scholars projects. Aziz Sidqi: Cooperative Society 1959). 2. Bahth ‘an Wasa’il Tanmiyyat al-Tijara al- INDUSTRY Dakhiliyya wa Mada al-Nuhud Biha Eng. M. Abdel Wahab Ministry of Industry Publications: (Paper on the means for Developing 1.“al-Thawra al-Sina’iya fi ‘ahad ‘ashar Internal Trade and The Extent of Eng. Fouad Abu Zeghla ‘aman 1952-1963.” ( Eleven Years of Promoting It) 1961. Mr. Louis Bishara Industrial Revolution). 3. Taqrir ’an Rihlat Mohammad AbdelAziz Mr. Mounir Ezz El Din 2. “Dalil al- Sina’a fi Misr fi thalathin sana Zayed Ra’is Majlis al-’idara lil-kharij ’an Dr. Adel Gazarin 1952-1982” ( Guide to Industry in Egypt in al’Mudda min al-’usbu’ al-’akhir min Eng. Abdel Moneim Khalifa 30 years). ’uktubar hatta al-’usbu’ al-Thalith min Mr. Ziyad Nashif December Sanat 1965 (Report on Mr. Bahaa Raafat Mohammad AbdelAziz Zayed’s Publications Mr. Hasan Ragab [Chairman of The Alexandria Commercial Company] Trip Abroad [Duration: Last Dr. Rouchdy Said 1. Sixtieth Anniversary 1920-1980. Week of October 1965 – Third Week of Eng. Ibrahim S. Mohamedein 2.Diamond Jubilee 1920-1995. September 1965]). Dr. Aziz Sidqi 3.Golden Jubilee 1920-1970. 4. Taqrir ’an Rihlat Mohammad AbdelAziz 4. Part 3 of Talaat Harb’s collection of Zayed Ra’is Majlis al-’idara ila al-Yaban speeches 1939. wa al-Wilayat al-Mutahida wa al-Miksik PLANNING (Report on Mohammad AbdelAziz Dr. Ismail Sabri Abdullah Café Riche Documents, Zayed’s [Chairman of The Alexandria Commercial Company] Trip to Japan, The Official Douments: United States and Mexico [Duration: EGYPTIAN 1. Maslahit il-Dara’ib il-‘Aqariyya records October/November 1966]). ENTERPREUNERS 1905 5. Taqrir ’an Rihlat Mohammad AbdelAziz 2. Official copy of Maslahit il-Dara’ib il- Zayed Ra’is Majlis al-’idara lil-’aswaq al- Mr. Mansour Hasan ‘Aqariyya records 1907. Qutniyya fi ’urupa al-Gharbiyya (REPORT Mr. Mohamed Taymour 3. Récépissé de déclaration pour un étab - Mohammad AbdelAziz Zayed’s lissement public: 16 October 1914. [Chairman of The Alexandria Commercial 4. Formal Declaration to the Office of the Company]Trip to The Cotton Markets in BANKING Assistant to the Chief of Police: 9 May Western Europe [Duration: June 1968]). 1916. 6. Taqrir ‘an Ma‘rad Suq Bari b-Italya AND FINANCE 5. Déclaration pour l’ouverture d’un étab- (REPORT The Bari Exhibition, Italy Mr. Hasan Abbas Zaki lissement public: 9 May 1916. [September 1970]). Mr. Mahmoud Abdullah 6. Inspection Report: 16 May 1916: Chief 7. MINESTERIAL ORDER: The order is the Dr. Salwa El Antari of Abdin Police Precinct. permission granted to Zayed to attend 7. Internal Note: Cairo City Police: the Bari Exhibition as Deputy Governor of Mr. Ali Dabbous For/Commandant C.C.P.: 8 July 1919. the Central Bank. Dalil al-Wukala’ al- Mr. Mohamed El Barbari 8. Internal Note: Confidential: Tijariyyin bil-Iqlim al-Misri, 1960 (Directory: Mr. Ali Shahin Commandant C.C.P.: For/Acting Trade Agents in the Egyptian Province, Mr. Fouad Sultan Commandant C.C.P.: 20 July 1919. 1960.) The directory is published by “The 9. Contract: 14 July 1921, Déclaration General Union of Chambers of pour l’ouverture d’un établissement pub - Commerce” INSURANCE lic: 4 November 1942. Mr. Hasan Hafez 10. Petition submitted by Mr. Abdel Malak Purchased Documents: Mikhail Salib: 22 May 1962, which cites the transaction contract with Avayianos, regis- CADEMIC ESEARCH 1. Land Contracts: Three land contract A , R , tered in 1962. registered in the court of Alexandria in 11. Letter from Russell Bey to Camp AND CONSULTANCY 1889, 1890 and 1893 under the Khedives’ Commandant of the British Officers, Head government. Dr. Heba Handoussa Quarters: 26 February 1918. 2. Stock Certificates: Credit Foncier Egyptien 1951, Societe de Biere “Les SMALL BUSINESSES Mohammad AbdelAziz Zayed Pyramides” 1956, Egyptian Federation for MAISON PAPAZIAN Agricultural Products 1943. Receipts: Three Papers/Reports: receipts from the Piastre Project for the Mr. Ashod Papazian 1. Muzakira bi-Sha’n ’usus al-Tijarah al- Revival of Egyptian Industries (mashru’ il L’AMPHETRION Dakhiliyya wa al-Kharijiyya fi al-Mujtama‘ qirsh). Mr. Adel To’ma al ’Ishtiraki al-Dimukrati al-Ta‘awuni 3. Letter from Michel Politis to Assistant to Mr. Henry Francis (Memo Re: Foundations of Internal and the Chief of Police: 9 May 1916. External Trade in the Socialist Democratic

54 Young Scholars’ Third AUC Forum on Conference, Economic and Business History of February 2006 Egypt and the Dates: Feb. 28 Middle East: Time: 7-9 pm he Third AUC Forum PAPERS TO BE PRESENTED: on Economic and T Business History of "Economic Liberalization and Law in 19th- Egypt and the Century Egypt: A Discourse Analysis," Middle East is due to By Zeinab Ali Abul-Magd, PhD. Candidate, Georgetown University. convene in May 2006.

“Railroads in the Land of the Nile: For further information Egyptian Railroads and the History of their please e-mail: Development” By Amr Nasr El Din, poltical science, [email protected] graduating senor, AUC.

“The Arab Bank: A Palestinian National Bank of Jordan” By Amr Ismail Adly, Economic Researcher. The Ministry of International Cooperation.

Offices: Rooms 307, 313 A, 314, 315, Old Falaki Telephone: 797 5603 / 5602 Email: [email protected]

Copyrights © EBHRC All Rights Reserved