The first phase (1981-91) Egypt’s infrastructure was in complete and utter neglect, after nearly 40 years of war. Mubarak had inherited from Sadat an economic mess, as foreign debt stood at 21 billion dollars, and tax revenues domestically plunged. Mubarak knew first and foremost that he had to rebuild the Infrastructure before any development would be forthcoming. Financing this infrastructure revival program, Mubarak would do this by foreign borrowing and by 1990 the nation’s debt was 50 billion dollars. Despite this, however,...
The first phase (1981-91) Egypt’s infrastructure was in complete and utter neglect, after nearly 40 years of war. Mubarak had inherited from Sadat an economic mess, as foreign debt stood at 21 billion dollars, and tax revenues domestically plunged. Mubarak knew first and foremost that he had to rebuild the Infrastructure before any development would be forthcoming. Financing this infrastructure revival program, Mubarak would do this by foreign borrowing and by 1990 the nation’s debt was 50 billion dollars. Despite this, however, Mubarak did succeed in a complete overhaul and reconstruction of the sewage systems, roads, and telecommunications. This was one of his more positive legacies.
In 1991 with arrears to foreign creditors mounting, Egypt, yet again was forced to undergo an SAP to be monitored jointly by the IMF and the World Bank, despite attempting to employ delaying tactics, as Mubarak feared the repercussions. Mubarak exploited Egypt’s geostrategic location in the Gulf War and “in deference to the role it played in the Gulf War, Cairo received extremely generous compensation, 7 billion dollars in military write off, and another 10 billion dollars from other bilateral creditors”.
Before the revolution, the Egyptian economy under Mubarak was performing better than ever, as Figure 1 illustrates. GDP growth began to gather pace, increasing from 5 percent in the late 1990s, to just over 7 percent in 2006-2009. Also, for the past four decades, the nations share of world trade had been falling, started to grow and expand as exports more than tripled.
