Lessons Learned From AID's Private Sector Development Efforts in Egypt

GAO reported on the progress which the Agency for International Development (AID) has made in assisting the Government of Egypt to develop its private sector.

GAO found that the development of a private-sector development strategy has been slow and difficult, with AID and Egyptian Government limitations impeding progress. The Egyptian business climate does not favor the private sector, and Egypt has not clearly defined the role which the private sector should play in its economic development. GAO found that AID had not long been involved directly with industrial private-sector development when it began to design a program for Egypt. The AID mission did not actively involve the Egyptian Government in developing its strategy, and it has viewed the program to date as a learning period and plans to refine its strategy and develop projects to better respond to Egypt's needs in the future. Because of implementation problems, GAO stated that it is doubtful some projects will achieve their objectives. Financial assistance provided has thus far benefited a relatively small group, primarily larger, financially well-established firms located in the Cairo/Alexandria metropolitan areas. Financial assistance has not been targeted toward small-scale enterprises which comprise the majority of Egyptian private enterprises. GAO believes that AID could apply some of the lessons learned in Egypt to other countries.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Joseph E. Kelley Team: General Accounting Office: International Division Phone: (202) 512-4128