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By Olga Rodríguez / Translation: Blanca García

Youssef Butros-Ghali and Dominique Strauss-Khan during the G-20 summit in April 2010 (Cliff Owen/AP)

  • Butros-Ghali, sentenced to 30 years in prison and subject of an Interpol arrest notice.
  • Until February he headed the IMF’s Monetary and Financial Committee

(Click on the link. Interpol website. Butros-Ghali’s record)

One of the main causes for the outbreak of the protests in Egypt was without a doubt the constant repression enforced by the regime against dissidents, critics, bloggers and political opponents. But there were also other factors that were the final straw and they are those related to the Arabic country’s economic situation and the corruption practiced by many members of the Government, including Mubarak himself.

Some of those abuses, that have widened the gap between the rich and the poor even more, were committed within the context of the so-called Egyptian economic reform that began in the nineties and through which a privatization of public enterprises process was promoted, with counseling from the International Monetary Fund and the World Bank.

Some of the regime’s former ministers and strong men face trial in court, accused of having sold state properties to foreign capital or to Egyptian businessmen close to the government for a price below its real market value, and of having profited from such transactions.

In fact several actions have been filed that ask for the State’s recovery of some privatized companies. It is the case of department store chain Omar Effendi, state-owned until it was sold to a Saudi company in 2006. An Egyptian court has ordered to restore its public ownership because it had been sold at a lower price than its real value.

For that same reason, the courts have deemed illegal a state land sale carried out during the regime to Palm Hill company, ran by people close to Gamal Mubarak, the ex-president’s son.

One of the men who instigated the privatizations policy was former finance minister Youssef Butros-Ghali, member of an influential family of politicians (he is the nephew of former UN Secretary General Butros Butros Ghali). During the eighties he was one of the ones who negotiated the country’s foreign debt, a process that led to the privatizations and to the wide opening to foreign investment.

In 2004, already as minister, he kept the same line of economic policy. In 2008 he held the post of president of the International Monetary Fund’s Monetary and Financial Committee (IMCF), main advisor to the IMF’s Board. It was common to see him in pictures next to Strauss-Khan and John Lipsky, president and vice-president of the IMF. The outbreak of the revolts prompted his resignation as minister and president of IMCF, and thus one of the members of the international organism’s leadership fell.

It is strange to see how what undoubtedly would have to be called the other great IMF scandal has barely gotten any attention. Butros-Ghali fled Egypt a day after the overthrow of Mubarak. The Egyptian government issued an extradition order to Interpol. There are several corruption charges against him, for which he has been sentenced in absentia to 30 years in prison.


One of those close to Butros Ghali is former Minister of Investment Mahmoud Mohieldin, who currently –since October 2010- holds one of the three managing directors of the World Bank and therefore one of the key posts in the international organism. Egyptian lawyers and activists accuse him of favoritism and of being involved in the privatization of a hotel chain that was sold under its real value.

A report recently published by the Egyptian government itself admits that in the last few years poverty and inequality have grown in the country. They are even more visible due to the price increase for basic foodstuffs such as bread in the year 2008, produced, among other reasons, by the speculation of the international financial markets.

That is the reason why, in spite of the ban on protests, there have been for some years constant workers’ strikes and demonstrations on the streets and factories, demanding decent wages and greater distribution of wealth. But none of that seemed to matter to the international community.

In fact the World Bank praised Egyptian economic policy in several reports, such as 2008 and 2009 “Doing business report”, responsible for rating in different countries the capacity of doing business with foreign capitals. Mahmoud Mohieldin himself obtained the Doing Business 2010 Award.

In October of that same year Mohieldin was named World Bank Managing Director and director of said organism’s Poverty Reduction program, posts he still holds to this day.

“The fact that one of the ones responsible of the Egyptian economic policy in the last years, that has fomented the breach between the rich and the poor, is director of the World Bank poverty reduction program, is worrying”, several of the groups that encouraged the January 25th movement have denounced.

When the revolts broke out in Egypt, the until recently IMF director, Strauss-Khan, admitted the existence of the economic factor as one of the causes of the uprising, asserting that “what is happening in the north of Africa shows that it is not enough to take into account the good macroeconomic data; we have to look much further than that”.

Seeing this affirmation it is inevitable to ask if up to this date Mr. Strauss-Khan and the rest of the team of the financial organism he headed had not realized that the first marker to look at to congratulate themselves or not is the one that refers to the citizens living conditions; that, using his expression, people also exist and are “far beyond” economy.

Ironies aside, what is true is that poverty, rise of inequality and corruption spread a wave of indignation across the Egyptian population, tired of seeing how a minority, the country’s political and economical elite, became richer every time, with the blessing of international financial organisms.

The existence of economic and social causes in the outbreak of the Egyptian revolts cannot be denied. Egyptians, like Tunisians, have demanded freedom, bread, housing and decent wages and a true democracy headed by autonomous governments –“we do not want an imported democracy”, has been one of the most chanted slogans-.

Their demands are in turn within a global context marked by the crisis of an unsustainable economic model that only benefits a few and that does not reject the dictatorships that take in the voracity of their codes.