Published On: Mon, May 15th, 2017

El-Sisi collects the pennies, the government misspends the pounds

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By Mohammed Nosseir

“Donate a pound a month” is the latest fundraising campaign advocated by Egyptian President Abdel Fattah El-Sisi; it follows many similar campaigns that fell substantially short of meeting their targeted goals.

The purpose of collecting small amounts of money from Egyptian citizens is not only to boost government revenues, but also to establish a new philosophy — that citizens are always indebted to their country. Nevertheless, Egypt’s true dilemma lies in how the government is spending its revenues.

One hundred billion Egyptian pounds was the initial targeted amount of El-Sisi’s ongoing “Long Live Egypt” fundraising campaign, which was followed by others with more modest targets, such as a campaign calling upon Egyptians to donate a pound each morning and another asking citizens to let the state keep their change.

All these fundraising campaigns collected small amounts, yet the continuous engagement of Egyptians in such schemes is meant to elicit citizens’ sympathy and to create a sense of obligation among them to donate money to their country. Meanwhile, the government continues to refuse to debate the feasibility and urgency of the megaprojects that it is presently implementing.

The effectiveness and efficiency of government expenditure is what really counts. Enhancing the government’s revenues (that are eventually misspent) ends up wasting the nation’s resources and energies and demoralizing its citizens.

What Egypt truly needs is a clear economic vision directed at engaging the entire population in the development and growth of our country. Identifying and promoting suitable investments will draw the required funds naturally, without the need for internal and external donations.

These ongoing fundraising schemes are creating the phenomenon of an unproductive society that relies on donations. We are sending a message to deprived Egyptians that the government will take care of them financially by collecting money from their wealthy fellow citizens. This approach will not enrich the large poor segment of society; it often concludes in taking donations from the state’s cronies in exchange for privileges accorded to them by the government, such as access to selective business opportunities and huge personal publicity.

Furthermore, directing the government to expand its investment also aims to make citizens value the role of the state more. El-Sisi wants to bring Egypt back to the 1960s era when the state alone was responsible for development and investment, and citizens played the role of beneficiaries. The government does not value any of the ideas and investments of Egyptian citizens because it is clinging to the “do it yourself” approach. Every single project that is expanded by the government could be better operated by the private sector, which would observe any potential financial risks and be held accountable to produce tangible results — two conditions that are do not apply to government-run projects.

With its large population, two-thirds of which is made up of young people, what Egypt needs immediately is the creation of new jobs. For example, the state would do better to replace its affordable-housing projects scheme with a plan that gives the same amount of money (in the form of grants) to the same beneficiaries, to enable them to set up their own investment projects. Our large population will never prosper by relying on the state’s expenditure; we need to have a society that is less dependent on the state.

Collecting citizens’ money — which is often misspent by the government — is an act that is doomed to fail; what Egypt needs is to allocate its expenditures wisely and to prompt citizens to expand their private investments. Our government simply needs to create a flow of investments by establishing proper economic policies that will prompt Egyptians and foreigners to expand their businesses in Egypt. Expanding the investment pie is the role of the private sector; contrary to the government’s understanding, the private sector will do a good job and take project risks into account.

–(Courtesy–Arab News)

 

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