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Egypt's Gamal Mubarak Aims to Underpin Growth (YAROSLAV TROFIMOV, 4/20/09, WSJ)

Egypt won't let the global downturn derail its free-market revisions, the ruling party's top policy maker, Gamal Mubarak, said in an interview with The Wall Street Journal.

"There is no way we can achieve our objectives without an economic-reform program that generates high levels of growth," said Mr. Mubarak, who is widely seen as a likely successor to his 80-year-old father, President Hosni Mubarak. [...]

"The crisis will be a reason to move faster on the reform, not to slow down," said Trade and Industry Minister Rachid Mohamed Rachid. This free-market spirit dates to 2002, when Gamal Mubarak became head of the policies committee of the ruling National Democratic Party. The graduate of the American University in Cairo quickly assembled a team of leading businesspeople and academics. They drafted an ambitious plan to lift Egypt's numerous restrictions on business. For the first time since Egypt's monarchy was overthrown by leftist officers in 1952, the country's cabinet included former businesspeople -- such as Mr. Rachid, a former senior executive at Unilever.

Since then, new legislation slashed import duties and cut the corporate tax rate from about 40% to 20% -- leading to a surge in overall tax revenues as the new tax code eliminated loopholes and opportunities for corruption. Large state companies, such as the Bank of Alexandria, were sold to private investors.

Braving sentiment against cooperation with Israel, the government established so-called Qualifying Industrial Zones -- areas where factories whose products use at least 10.5% of Israeli materials enjoy duty-free access to the U.S. These zones now export some $745 million in goods a year.

"What has changed is that we're moving from an economy which by all measures has been very much centrally driven, government-dominated in a big way -- to an economy which, while still in transition, is much more business friendly and more competitive," Mr. Mubarak said in the interview.