US embassy cable - 05CAIRO8077

UNCLAS CAIRO 008077 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PGOV, ECON, KDEM, EG, corruption 
SUBJECT: GAMAL MUBARAK ON CORRUPTION IN EGYPT 
 
Sensitive but unclassified.  Protect accordingly. 
 
1. (SBU) During their October 18 meeting, the Ambassador 
flagged for Gamal Mubarak President Bush's personal interest 
in the subject of corruption and international efforts to 
combat it.  Corruption poses a serious threat to the 
processes of economic and political reform, the Ambassador 
continued, and underlined U.S. interest in supporting 
Egyptian efforts to stamp it out.  He recommended that the 
GOE and ruling NDP pre-empt opposition attempts to exploit 
popular resentment at corruption by making anti-corruption 
action a priority.  Beyond the public references already made 
by President Mubarak himself, and other senior GOE figures, 
the Ambassador recommended that the GOE show the Egyptian 
people that the GOE and NDP "have a plan, are acting on it, 
and are getting results." 
 
2. (SBU) Gamal responded that corruption had long been an 
issue in Egyptian politics and acknowledged that it remains a 
problem in Egyptian society.  At the same time, Gamal 
asserted, the GOE has long taken a hard line on corruption, 
bringing many prosecutions on corruption cases, including a 
number of high profile cases.  Gamal asserted to the 
Ambassador that many of the economic and political reforms 
recently implemented, or currently in the process of 
implementation (most designed by Gamal's policies secretariat 
within the ruling NDP), are yielding tangible gains in the 
battle against corruption. 
 
3. (SBU) "The point is not what people are saying about 
corruption, but what we are actually doing about it," Gamal 
agreed.  Egypt, he continued, has a plan to fight corruption, 
and cited the overhaul of Egypt's taxation regime, customs 
reforms, and the devolution of authority to local government 
units as examples of reforms that would "fundamentally change 
the way the GOE does business" and sharply reduce, if not 
eliminate, many opportunities for corruption.  He stated that 
more structural reforms designed to improve governance and 
fight corruption will be GOE priorities for the new People's 
Assembly. 
 
4. (SBU) The Ambassador reemphasized to Gamal the USG's 
interest in the issue of corruption and its readiness to help 
Egypt redouble its efforts to combat it, including through 
ongoing USAID programs supporting governance reform.  Gamal 
welcomed the offer. 
 
5. (SBU) Comment:  The Ambassador's conversation with Gamal 
Mubarak follows up previous discussions of the issue with 
Minister of Trade Rashid and Minister of Investment 
Mohieldin.  Recent evidence of new GOE attention to 
corruption came during the presidential campaign and 
subsequently through the public comments of both those 
officials.  The Ministry of Investment is expected to publish 
new corporate governance guidelines in the near future. 
Meanwhile, the People's Assembly is expected to resume 
debate, after the new parliament is seated in mid-December, 
on a draft anti-corruption law which is understood to 
establish a new government agency especially charged with 
combating corruption.  The last significant spurt of 
anti-corruption activity came in 2001-2, when the GOE's 
Administrative Control Authority (ACA) brought a number of 
high profile corruption cases, including a case against the 
Governor of Giza, Egypt's second most populous province, 
under the leadership of prosecutor Hitler Tantawi in 
2001-2002.  Tantawi has since left the job, and the ACA's 
activities have mainly dropped off the public radar screen. 
End comment. 
 
 
RICCIARDONE