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The Role of Foreign Capital in Egypt's Economic Development: 1960–1972

Published online by Cambridge University Press:  29 January 2009

Nazem Abdalla
Nazem Abdalla
Affiliation:
University of Maryland, Eastern Shore Princess Anne, Maryland
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Extract

Egypt is a less developed country that made use of foreign capital to accelerate its rate of economic development and growth.

In 1960 Egypt embarked on long-term economic development planning. A Five-Year plan (1960–1965) was followed by a Seven-Year plan (1965–1972). In planning for economic development, Egyptian authorities relied heavily on foreign capital.

Type
Articles
Information
International Journal of Middle East Studies , Volume 14 , Issue 1 , February 1982 , pp. 87 - 97
Copyright
Copyright © Cambridge University Press 1982

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References

NOTES

Author's note: I am very grateful to Professor Ramon Knauerhase for valuable comments and suggestions made on a previous version.

1 Foreign private and public debt outstanding, including undisbursed debt but excluding military debt.

2 World Bank, World Debt Tables (Baltimore: Johns Hopkins University Press, 1976), p. 311.Google Scholar

3 Ibid.

4 World Bank, “External Public Debt of L.D.C.'s”, World Debt Tables, Vol. 1 (10 31, 1975). p. 60.Google Scholar

5 Kanovsky, Eliyahu, The Impact of the Six-Day War: Israel. The Occupied Territories, Egypt. Jordan (New York: Praeger, Inc., 1970), p. 225. The loans were to be repaid over a twelve-year period with a 2.5 percent interest charge.Google Scholar

6 Ibid., p. 226.

7 Tansky, Leo, U.S. and U.S.S.R Aid to Developing Countries: A Comparative Study of India. Turkey, and U.A.R. (New York: Praeger, Inc., 1976), p. 185.Google Scholar

8 Ibid., p. 214.

9 Ibid., p. 184.

10 Amounts for 1946–1969 from Hansen, Bent and Nashashibi, Karim. Foreign Trade Regimes and Economic Development: Egypt, Vol. IV (New York: Columbia University Press, 1975);Google Scholar amounts for 1970–1972 from the International Fund, Monetary, Balance of Payments Yearbook, Vols. 19–23, (Washington, D.C.: International Monetary Fund, 1968–1972).Google Scholar

11 Issawi, Charles. Egypt in Revolution (Oxford: Oxford University Press, 1963), p. 239.Google Scholar

12 Tansky, , p. 206.Google Scholar

13 Ibid., p. 183.

14 Kanovsky, , p. 226.Google Scholar

15 Tansky, , p. 213.Google Scholar

16 Starting in late 1967, Arab oil-exporting countries offered Egypt large sums in outright grants.

17 Anwar Sadat on the Issues and Answers television program, October, 1975.

18 Magdi, M. El-Kammash, Economic Development and Planning in Egypt (New York: Praeger, Inc., 1968), p. 315.Google Scholar

19 Nasr cars are Fiats assembled in Egypt.

20 Although data are not available, one could safely assume that net foreign private direct investment into Egypt was also negative during 1960–1966, since nationalization measures were being ordered by Egyptian authorities during that period.

21 Saudi Arabia, Kuwait, and Libya.

22 Hansen, and Nashashibi, , p. 64.Google Scholar

23 SDR = 1.0857 $ US.

24 This figure is a rough measure since the debt outstanding disbursed accumulated by 1972 started growing in 1958. In addition the $64 million net outflow due to foreign private direct investment during 1967–1972 is excluded. Foreign private direct investment transactions that might have occurred between 1960 and 1966 are also excluded.

25 The $3,503 figure is to be regarded as slightly larger than the actual amount for the 1960–1972 period since it includes capital channeled to Egypt during 1958 and 1959.

26 This method is based on that used by Magdi, M. El-Kammash, pp. 319–323.Google Scholar

27 Figured out to be roughly. 43 for that period.

28 Hansen, and Nashashibi, , p. 11.Google Scholar

29 Kanovsky, , p. 254.Google Scholar

30 Ibid.

31 World Bank, World Debt Tables (Baltimore: Johns Hopkins University Press, 1975), vol. I, p. 15.Google Scholar

32 The ratio of payments of principle and interest on foreign debt to the exports of goods and nonfactor services.

33 The average debt service ratio for L.D.C.'s in 1973 was 9.4.

34 World Bank, World Debt Tables, vol. 1 (1975), p. xxviii.Google Scholar

35 Egypt Economic Survey, African Development (Cairo, 1976), p. 8.Google Scholar

36 Ibid.