CAIRO: Several accusations of irregular buying and selling of Egypt’s state-owned land recently led to the issuance of a presidential decree which may be a step towards reforming land use regulations.
Presidential Decree No. 221/2010 issued last week outlined provisions for placing state-owned land under the usufruct system, allocated a number of areas of state-owned land to the General Authority for Roads, Bridges and Land Transport as well as announcing 73 new fuel stations to be built across the country.
According to state-run daily Al-Ahram, President Hosni Mubarak stressed in a meeting with ministers last week the need to develop “transparent and streamlined rules” for the buying, selling and management of state land.
According Al-Ahram, the president also said that specialized bodies should be tasked with managing land, deciding whether to sell or lease it, conducting the planning process, and raising the efficiency of utilization in order to optimize the income for the state in the interest of further development and economic growth.
Omar El-Shawadfy, director of the National Center for Planning State Land Uses (NCPSLU), said that this resolution aims to create transparent methods to maximize the return on investment of state land as well as the implementation of the state’s development plans.
“State-owned land is now an essential resource to the [national] treasury, so the government has been keen to put it to good use,” El-Shawadfy said at a conference in July.
The center had been studying a group of projects, regarding service and fuel stations across the country, to be built under the General Authority for Roads and Bridges using the usufruct system, he added.
The presidential-level meeting was attended by Minister of Trade and Industry Rachid Mohamed Rachid, Minister of Agriculture Amin Abaza, and Minister of Water Resources and Irrigation Mohamed Nasr El-Deen Allam. Officials discussed the establishment of industrial and agricultural communities in the various governorates of Egypt in order to create job opportunities for farmers as well as facilitate the export of their products.
Allam stressed the importance of development of irrigation projects and the rationing of water use, especially as it is currently developing a strategy for the irrigation of 5 million acres in the Nile Delta and valley regions, the state run daily reported.
“These plans were addressed in detail, including crop cycles, rotations and irrigation techniques for the coming period, the balance between new land and old as well their impact on raising the quality of life of farmers,” Rachid was quoted as saying.
Making deals
However, the government’s rhetoric about reforming land use has been marred by allegations of favoritism and cronyism by the government toward wealthy businessmen, many of whom also have political ties to the ruling party.
In June, accusations of favoritism were targeted at the Talaat Moustafa Group (TMG) project Madinaty regarding the extension of electricity, water and sewage infrastructure to the area and duties on construction materials.
Egypt’s High Administrative Court is expected to rule on Thursday on the legality of a land sale struck by the housing ministry and Talaat Moustafa Group (TMG) after a court-assigned body advised canceling the deal, Reuters reported. TMG is building its flagship Madinaty project of homes, schools, shops, hotels and a golf course on 8,000 feddans (8,304 acres) of land on Cairo’s outskirts.
A lower court ruled last June that the contract should be scrapped because the New Urban Communities Authority (NUCA), a body under the ministry, sold the land directly to a TMG unit without an open auction.
Earlier in the year, Mohamed Suleiman, who was the minister of housing at the time of the deal, was placed under investigation for allegedly embezzling public money and illegally allocating plots of land to his relatives, children and business associates.
Despite government plans to make it easier for investors to acquire land, corruption and bureaucracy remain major concerns for investment.
Tarek El-Ghamrawy, an economist at the Egyptian Center for Economic Studies who recently conducted research about bureaucracy and corruption, told Daily News Egypt, “Investors in Egypt still face several bureaucratic difficulties while taking the legal steps of the investment process when acquiring land, such as the multiplicity of the required documents, the complexity of operational procedures.”
“There is also the sluggishness in government employees and offices in the implementation of the procedures, the multiplicity of agencies responsible for the same action, and the complexity of laws which are sometimes contradictory,” he added.
El-Ghamrawy explained that as more offices and employees are included in the investment process, from purchasing the land to obtaining utilities on it, “it opens the door wide for corruption, prevarication and illegally acquired funds by government employees and offices.”
He pointed out that Egypt’s ranking in the Corruption Perceptions Index in the public sector, which is issued by Transparency International, is still a very low 111 out of 180 countries in 2009-2010.
“It is not surprising that the Global Competitiveness Report for the 2009-2010 stated that the most important obstacles to competitiveness in Egypt — among the 15 categories — is government bureaucracy,” El-Ghamrawy added.
