Egypt's economic reform meets unprecedented wave of labor resistance

This week, tax collectors went on strike, adding to growing labor unrest that threatens to unleash a 'social explosion' against Mubarak's regime.

By Dan Murphy | Staff writer of The Christian Science Monitor

from the December 7, 2007 edition

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Cairo - The first time the 27,000 employees at Misr Mahallah Spinning and Weaving factory went on strike, it was with the feeling of a doomed effort that they nevertheless had to make.

After all, independent labor activity is illegal in Egypt and in the 1980s the government had called out the troops on striking workers, killing scores.

Then the unexpected happened.

With dozens of other factories going on strike around the same time late last year – pressing similar demands to those at Mahallah – they won.

Government officials caved in to most of their demands in the hopes, analysts say, that it would stave off the emergence of a politicized labor movement at a time when the regime of President Hosni Mubarak was taking a beating from the domestic press and a more assertive Muslim Brotherhood, the country's most popular opposition movement.

"The government is worried about a social explosion," says Mustafa Basyouni, the labor correspondent for Al Dustour, an Egyptian daily. "When the government saw solidarity strikes popping up, that pushed the scales in favor of accommodation."

If that was in fact the intention, it failed. In the past year, Egypt has seen an unprecedented wave of strikes, sit-ins, and demonstrations at its factories – at least 300 of them involving well over 150,000 workers, amounting to what labor historian Joel Beinin calls the "biggest mass movement in Egypt" since the 1950s.

The workers at Mahallah went on strike again in September and again wrung concessions out of a skittish government.

This week, it's Egyptian tax collectors who are striking, complaining that they can't live on salaries of about 350 pounds ($60) a month. About 55,000 tax collectors walked off the job, and Tuesday, when about 500 of them sought to march on the Cabinet building in central Cairo, they were blocked by riot police.

Inspired by that strike, workers at the government's Ministry of Health have also threatened to walk out.

Egypt's labor unrest can be tied to the liberal economic policies of a wing of Mr. Mubarak's ruling National Democratic Party (NDP) that is led by the president's son, Gamal. He is a former banker who at the moment looks the likeliest candidate to succeed the elderly ruler.

Under the stewardship of an economic team seeking to throw off Egypt's Arab socialist past in favor of free market economic policies favored by the International Monetary Fund, Egypt's stock and property markets have boomed and dozens of state companies have been sold to private investors. Foreign investment in Egypt tripled last year to $6 billion.

But the country's economic recovery has been a jobless one, with stagnant wages falling well behind double-digit inflation rates and workers feeling squeezed by layoffs at both government and private factories as the government seeks to cut the dead wood from the national economy.

For average workers, there has been precious little of the trickledown that the government promised would be the fruit of economic reform, and patience appears to be wearing thin.

Mohammed Kamel al-Sayyid, a political science professor at the American University in Cairo, says the country's labor unrest could, over the long term, prove one of the greatest threats to the stability of the system, as a generation of Egyptians brought up to count on government jobs for life confront a new reality.

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