The current difficulty confronting the Egyptian economy is the pressure on its resources, owing to one of the world's highest ratios of population to habitable and cultivable land, and its struggle to achieve a market-based economy. In order to combat this problem, since the 1991 Gulf War between the multinational forces and Iraq, Egypt has normalized its relations with international monetary organizations and, in response to their stipulations, has begun to implement a far-reaching program of public enterprises and the liberalization of trade (Egypt, 1993, p. 996).
Egypt's foreign debt, however, remains a heavy burden on the economy. Economic plan targets, announced May 1992, included an average GDP growth of 5.1 percent between 1993-1994 and 1996-1997; and the creation of 2.5 million jobs between those same years (Egypt, 1993, p. 996).
The Egyptian economy has long provided contrasts. For example, a square meter of land may cost $5,000, but the typical monthly salary is $50, and rubbish is still collected by bedraggled children in rickety donkey-carts (The sphinx, 1992, p. 42). President Hosni Mubarak's reforms may make the contrasts even sharper. His government hopes to wean his people from 30 years of expecting the state to provide secure jobs and cheap food, energy, housing, medicine, and schools.
The legacy of Egypt's experiment with nationalization and central planning has been calamitous. Almost half the workforce is paid--miserably--by the state. Five hundred overstaffed, debt-ridden, inefficient state-owned companies account for the bulk of industrial output. Theoretically free, public services like health and education have worn down under pressure from overcrowding and private competition. Without subsidies that keep the price of bread at under two American cents for a four ounce loaf, many would go hungry.
Nevertheless, Egypt has a great deal of capital worth, much of it earned by the three million...