i. Privatization process and its impact in Egyptian textile and clothing industry
The Egyptian textile and clothing industry has been of vital significance to the Egyptian economy, as the entire production process from the cultivation of cotton to the production of yarns, fabrics and garments are performed domestically. According to El-Haddad, in 2008 the industry produced 26.4% of industrial production, LE 33.5 billion of total value added (MOED 2008), and approximately 10% of the country’s exports (El-Haddad 2010:2). In addition to this, the industry represents the largest single employer with over 400,000 workers, which may help alleviate the growing unemployment problem in Egypt.
Despite the significance of this industry to the Egyptian economy, the open door and economic structural reform policies ultimately took a toll on the fate and performance of the textile and clothing industry. The privatization process of the textile and clothing industry led to a negative impact on the booming industry in Egypt. Two factors predominately affected the specific industry: the termination of subsidies and the liberalization of cotton trade of 1994 as part of the Economic Reform and Structural Adjustment Program of 1991. Rising costs and liberalization of trade of such a vital industry in Egypt led to an effect on government subsidy policy, legal reform and unemployment.
ii. Impact of privatization on subsidies, legal reform and unemployment
The process of privatization in the Egyptian textile and clothing industry contributed to a series of consolidated events that conformed the fate and performance of the industry. In the 1980s, the government terminated the subsidy to clothing...
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6. El-Haddad, A. 2010. “Effects of the Global Crisis on the Egyptian Textile and Clothing Sector.” International Labor Organization and the Egyptian Center of Economic Studies, (Accessed 12 December 2013),
7. Fattouh, B. 2013. Privatization in the Middle East and North Africa. Lecture notes. (Accessed 21 December 2013),
7. U.S. Department of State. 2013. “2013 Investment Climate Report.” U.S Department of State, (Accessed 12 December 2013),
8. World Bank. 1995. “Bureaucrats in Business.” The World Bank Report 1995, (Accessed 21 December 2013),
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