Pressing challenges, flashpoints await Madbouly’s gov’t



Fri, 08 Jun 2018 - 10:42 GMT


Fri, 08 Jun 2018 - 10:42 GMT

FILE- Newly-appointed Prime Minister Moustafa Madbouly - Egypt Today

FILE- Newly-appointed Prime Minister Moustafa Madbouly - Egypt Today

CAIRO – 8 June 2018: With the new prime minister taking the lead of the new government, and amid the current harsh economic circumstances, Madbouly will face several feats.

On Thursday and three days following Ismail’s resignation, President Abdel-Fatah al-Sisi appointed Minister of Housing and Urban Utilities Moustafa Madbouly as the new prime minister

Madbouly assumed the position earlier during the absence of the then-Prime Minister Sherif Ismail, who was on a one-month medical treatment in Germany.

From the ramifications of the currently-implemented economic reform plan, to pursuing the governmental development projects, Egypt Today presents an overview with the hurdles awaiting Madbouly’s new government.

On the economical level:
Addressing the rapidly increasing prices of commodities as the result of the implementation of the new economic reform plan that aims at gradually lifting the subsidies tops the new government’s priorities.

Under the government of Ismail, the state initiated a set of reforms that include the pound’s flotation in November 2016, VAT introduction and subsidy cuts, backed by a $12 billion three-year loan agreement with the International Monetary Fund (IMF).

A new wave of price hikes in tune with the increase of fuel prices is predicated in July, as part of the IMF loan.

In another context, Egypt has one of the Middle East’s largest natural gas reserves; notwithstanding, it still struggles to fulfill its monthly export commitments as Egypt used to tap most of its gas for domestic use.

Domestic energy demand has surged due to heavy subsidies on petroleum products, allowing residential and industrial consumers to purchase gas and power facilities far below market cost.

Direct Investments:
Attracting direct investments to Egypt is one of the most pressing issues that the new government will have to tackle, as the government seeks to further progress in this regard.

In 2017, it passed a new investment law that offers foreign investors a bundle of incentives that include tax breaks and rebates. It also deals with bureaucratic problems, promises the simplification of procedures, and provides guarantees for investors.

According to the Central Bank, and during the first half of the current fiscal year, Egypt attracted foreign direct investment of $3.8 billion, compared to $4.3 billion in the same period last year.

Egypt has long been suffering from the debilitating and unproductive education system, which opted out of international standards.

Two months ago, the Ministry of Education introduced a comprehensive new system known as the "Education System 2", which is set to first be implemented starting next academic year 2018/2019.

The new education system ensures an advanced quality of education to students and does not mainly focus on grades.

According to the Ministry’s statistics for the academic year 2016/2017, Egypt has 45,279 public schools, with 18,608,730 students enrolled them.

Some 89.5 percent of children are enrolled in public schools, 10 percent dropped out and the nation’s illiteracy rate currently stands at 15.8 percent, which is equivalent to 14,500,000, according to the Central Agency for Public Mobilization and Statistics (CAPMAS)

Youngsters’ unwillingness to get engaged in the educational process is one of the reasons attributed to child drop out, as well as the weak financial status of their families and in some cases the schools are found to be distant from the child’s place.

Healthcare system:
Lack of some prime medicines in the markets and lowering the extortionate prices of the medicines imported is one of the challenges in the health sector that need to be addressed by the new government.

Since the flotation of the Egyptian pound on Nov. 3, 2016, key drugs have disappeared from the market, among them basic medicines like Insulin, government-subsidized imported baby formula and contraceptive pills. The shortage affected patients with chronic diseases the most; especially those with hypertension and diabetes.

Pharmaceutical companies have suspended the production of some drugs to prevent financial losses since they are unable to import drugs and their active ingredients without raising their prices above levels set by the Ministry of Health.

Following a severe shortage of penicillin in late 2017, the Health Ministry's Pharmaceutical Inspection Department announced that it would monitor the distribution of penicillin daily from Egyptian pharmaceutical trading companies to the markets.

Also, the new health insurance is one of the most notable laws that are predicated to be signed into law during the term of the upcoming government.

Under this law, the government is to fully cover the treatment of citizens who cannot afford it and will improve the quality of medical services in public hospitals by inspecting and supervising medical facilities. The law will be implemented in the duration of 15 years to include all Egyptian governorates.

Key accomplishments of Sherif Ismail's government

CAIRO - 6 June 2018: Egypt's Prime Minister Sherif Ismail submitted on Tuesday the resignation of his government only two days after President Abdel Fatah al-Sisi was officially sworn in as the head of state for a second term until 2022, according to the presidential spokesperson, Bassam Rady.

Madbouly, 52, has retained his position as minister of housing and urban utilities since 2014. He served with two following prime ministers, including Ibrahim Mahlab until September 2015 and with Ismail from September 2015 until June 5, 2018.

On June 5, Egypt’s Prime Minister Ismail submitted the resignation of his government only two days after President Sisi was officially sworn in as the head of state for a second term until 2022, according to presidential spokesperson, Bassam Rady.



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