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Industrialization in Egypt: Historical Development and Implications for Economic Policy

Author

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  • Ronia Hawash

    () (Faculty of Management Technology, The German University in Cairo)

Abstract

Although Egypt has begun industrialization long ago (1920's), it is still lagging far behind other countries that have begun the industrialization process much later than Egypt. The arising problem is that the Egyptian manufactures' sector is facing a deteriorating position in terms of trade, as the Egyptian economy faces competitive pressures from three fronts: First, countries within the MENA region which opened up their economies early and took positive measures to increase their competitiveness such as Tunisia and Morocco. Second, East Asian economies and European transition economies which are characterized by having more efficient productive structures using skilled labor and capital intensive activities and hence produce higher value added and better quality goods. Third, the large unskilled, labor abundant, low wage economies such as China, India and Bangladesh that have been integrating rapidly in the global economy, exerting growing competitiveness pressures on countries exporting low-skilled manufactures such as Egypt. This paper deduces that the constraints to having a booming industrial sector are related to the inefficient human resource development, technical constraints, legislative constraints and economic constraints. Accordingly, the paper recommends having more investments in human development, building the capabilities of the public sector, more enhancements for the small industries, and managing the process of integration in the global economy.

Suggested Citation

  • Ronia Hawash, 2007. "Industrialization in Egypt: Historical Development and Implications for Economic Policy," Working Papers 1, The German University in Cairo, Faculty of Management Technology.
  • Handle: RePEc:guc:wpaper:1
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    File URL: http://mgt.guc.edu.eg/wpapers/001hawash2007.pdf
    File Function: First version, 2007
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    More about this item

    Keywords

    Industrial development; industrial policy;

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination

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