Trust reflects positively on nations’ rapid economic growth argues renowned political scientist Francis Fukuyama. To further illustrate his point, Fukuyama claims in his book, Trust: The Social Virtues and the Creation of Prosperity, that the high level of mutual trust and other shared positive cultural traits, such as hard work, have empowered Germany and Japan to become advanced nations. In the Egyptian business community, there is a noticeable shortage of trust that often leads to considerable business deceleration.
Nevertheless, the absence of trust in a given society could be compensated to some degree by the proper application of rule of law, which is also lacking in Egypt, either due to the ambiguity of our laws or to the extensively lengthy and bureaucratic proceedings of our courts. Egypt is known for its formidable government bureaucracy that can be circumvented by bribes whose sizes vary depending on the value of the transaction and the length of the bureaucratic procedure.
Some argue, correctly, that bureaucracy and corruption have been rampant and thriving in Egypt for decades. In the past, however, the Egyptian economy was mainly driven by cronies who were adept at overcoming both challenges smoothly and elegantly. Nowadays, Egyptian State entities are taking over projects from the famous Egyptian business cronies; while the timeframes of the projects they implement are admirable, these State entities certainly lack the entrepreneurship and the innovation that the private sector has the potential to offer.
Egyptians are generally individually driven creatures; rather than doing the right thing, they prefer to satisfy their personal egos by delusionally believing that they are always right! This behavior is plainly noticeable in most Egyptian family businesses wherein siblings immediately split inherited businesses to enable each family member to do whatever satisfies their personal egoism. Some families even tend to divide the business during the lifespan of the father to avoid any conflict in the event of his demise!
Furthermore, Egyptian society is formed of people with limited ambitions who don’t have any desire to expand their businesses internationally, or even regionally. I can’t think of a single Egyptian business enterprise that has a regional presence. By contrast, many Arab companies and banks are successfully expanding in the region, including in Egypt. Even products produced exclusively by Egyptians, such as our movies, are broadcast regionally, and successfully, by non-Egyptian media channels.
We are a society that easily settles for compromises. However, we are also an over-demanding society; werequire new employees to fulfill high-quality criteria that many of their present directors often cannot meet. Furthermore, the vast majority of Egyptian employees doesn’t work to advance their organizations’ productivity, which may directly affect their conditions of employment. Instead, they are constantly searching for new jobs, convinced that the professionalism that is lacking in their present workplace can be found in a new enterprise.
Moreover, paying millions of dollars to international TV channels to promote Egypt as an attractive investment or tourism destination will certainly interest the world in learning more about our investment opportunities, rules and business environment – which should have prompted us to work on addressing our business structure deficiencies prior to publicizing ourselves globally.
Egypt presently lacks the principal pillars for founding a sound economic platform that are needed to develop a truly modernized nation. Egyptian private enterprises will not be stimulated to modernize their entities on their own; our society is a naturally “static” society, wherein citizens prefer to prolong their respective enterprises’ status rather than risk changes that they can’t apply! This attitude is shared even by various Egyptian chambers of commerce and industry, who work to serve their members’ business aspirations.
The Egyptian government needs to expand its leadership role to fix our socioeconomic flaws, carefully addressing the private sector’s challenges by offering a bundle of scientific solutions. The government must immediately work on advancing rule of law, meritocracy and sound economic policy; these practicalities will help Egyptians to restore better socioeconomic norms. The sooner we tackle these issues, the better the results will be.