Egypt business welcomes military stance on strikes

Egyptian industry leaders said a new warning from the country’s military rulers of direct action against striking workers will help get the economy back on its feet after weeks of disruption.

Sunday, the start of Egypt’s working week, will offer the clearest sign yet of whether the strikes in banks, factories, mines and government offices are drawing to an end.

If they are, it would raise optimism that businesses damaged by the political turmoil can return to normal in a few weeks and help limit losses of investors stung by the crisis.

Trading on Egypt’s stock market was halted for three weeks after the market lost LE69 bn of its value over two days. The reopening has been delayed several times.

The army, which has held back from intervening to end strikes, protests and sit-ins since the downfall of President Hosni Mubarak, said on Friday they threatened national security and it would not allow them to continue.

“I think people will follow the instructions because they trust the army,” said Mohamed Khamis, head of Egypt’s Federation of Investment Associations.

“I hope that, if necessary, the army will put its words into action”, said Mohamed Said Hanfy, General Manager of Egypt’s Chamber of Metallurgical Industries.

He said industry could get going again in two to three days.

Banks reopened on Sunday. Their closure for almost all of the week made companies scale back operations as they were unable to sell their goods or pay for supplies.

Engineering firms not hit directly by the protests were forced to cut production because their distributors were unable to sell the goods on to the end customer.

Farouk Shalash, director of the Chamber of Engineering Industries, said it could take time to get back to normal.

“I think maybe after two to three weeks more, when they feel the market starts to move again which is very important, they will try to reach full capacity again,” he told Reuters.

Sporadic labour unrest was still being reported on Saturday.

Production stopped at a cement factory near Qena, 600 km (370 miles) south of Cairo, after more than 350 workers went on strike due to what they called bad work conditions and poor pay, state news agency MENA reported.

Modern Nile Cotton Co. said it was still working two shifts instead of three because of an ongoing nightly curfew. The government was was working to lift the curfew “soon”, MENA said.

Chairman Ahmed Elbosaty said the company had sent containers to the ports of Alexandria and Dekheila on Wednesday but had to return them to warehouses because of strikes. The company was also unable to issue bonds because of the bank shutdown.

Some businessmen welcomed the army’s statement, but said it came a little late in the day.

“The army should have given a firm statement for all kinds of sit-ins to stop, immediately after Mubarak stepped down,” Sami Mahmoud, a board member of the Nile Company food distributor, said on Saturday.

“Though this statement should have come way earlier, I think the army was just allowing people to take their chance to voice their demands and enjoy the spirit of freedom,” said Walid Abdel-Sattar, a businessman in the power industry.

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