Carnegie: Egypt will only rise by getting rid of the military economy

A report published by the Carnegie Middle East Center on its website warned that the establishment of the military economy is causing serious harm to democratic policies in Egypt despite its shortcomings.

Yazid Sayegh, author of the report and principal researcher at the Carnegie Endowment in Beirut, advised the need to abolish the military economy in most sectors, rationalize it in other selected sectors, and place it under clear civilian management if Egypt wants to solve its chronic structural dilemmas that hinder its economic development, inhibit productivity and investment, and undermine engines. Market dynamics), thwart private sector growth.

The researcher specialized in civil-military relations that the government will not be able to exercise effective economic management only if the networks of informal officers crouched on the civil bureaucracy and private sector companies and local government.

The author of several studies in the Egyptian army economy said that the optimistic assessments of the Egyptian macroeconomic indicators - issued by Egyptian officials and their counterparts in Western governments and international financial institutions - overlook the fundamental problems of low productivity, lack of creativity and limited value added, as well as lack of investments in most economic sectors. .

The researcher believes that those officials may hope that Sisi can, in one way or another, build a "successful development dictatorship," which explains their neglect of the social consequences of his government's economic approach, its violent suppression of political and social freedoms, and its "flagrant" violations of human rights.

Trends now suggest that Sisi will remain hostage to his key coalition partners, including the military that leads the economy, the report said.

Sayegh said that at best, the military makes good engineers, but at the same time provides bad economists.

He said that the huge boom in the construction of mega projects in the public infrastructure and housing sectors, which the army has been managing since 2013, produces a large amount of unproductive capital and assets and properties that are undervalued, leading to the transfer of investments and resources from other economic sectors.

He pointed out that President Abdel Fattah El Sisi has transferred the military establishment to an independent and effective element capable of reshaping markets and influencing the formulation of government policies and investment strategies.

He also said the military is carrying out massive infrastructure projects, producing consumer goods ranging from food and household items, manufacturing chemicals, transporting equipment and importing basic goods to civilian markets.

The army expanded into new sectors ranging from gold exploration, steel production, religious endowment management and pilgrimage.

In parallel, thousands of senior retired officers benefit from the military's strong political influence in high-ranking positions in the civil service of the state and public sector companies, thereby benefiting and benefiting from the formal military economy.

Despite this, the Egyptian army plays a much lower role in the national economy than is commonly believed.

The military establishment boasted of its superior management skills and technological achievements, and claimed to be the spearhead of development. However, its role has a high price, reproducing the rentier pattern of the Egyptian political economy, benefiting like its civil counterparts in the public and private sectors from an environment that allows ample room for looting and corruption, with its legal pretexts, bureaucratic complications and discretionary powers.