In a (very small and overly patronising) nutshell, from what I've gauged of the situation, Egypt is undergoing political transformation; this week the presidential elections will take place, and 50 million people in Egypt will be encouraged to vote. It's the first free election since Hosni Mubarek was ousted. He was Egypt's President for 29 years.
But that's not what I'm interested in today. I'm interested in the post-Mubarek development. Egypt entered into a recession in 2011 during the Arab spring according to The Guardian, and since then, it's been struggling to get back on track. Exports to the eurozone have dropped 2 percent, and the country is struggling. Over 20 percent of the country's population live off less than $2 US a day.
Enter the European Bank for Reconstruction and Development (EBRD).
We provide project financing for banks, industries and businesses, both new ventures and investments in existing companies. We also work with publicly owned companies.
So... Can capitalism help those with no capital to begin with in developing countries? Do banks loan to people in these countries who have no collateral? Can privatisation really work?
Yes.
I've loaned through Kiva and worked with Shared Interest, but the EBRD is an entire bank founded on the same ethics and principles of these foundations (for want of a better word, please do correct me if I'm wrong).
What has this got to do with Egypt, you're asking. Well, this week, the EBRD's chief economist held meetings with the deputy governor of the Bank of Egypt to discuss lending through the private sector.
How does it work? Again, in (a ridiculously teeny tiny) nutshell, essentially the butcher, the baker, and the candlestick maker are given loans by the EBRD to start businesses with very little interest. Oh, and they only help those who no one else will. Why? Because they will become the middle class eventually. So what? Having a middle class in a developing country with no democracy = democracy.
I appreciate that as a bank, the EBRD still runs off profits, but what's wrong with that? If you can be a business that can make a profit and mobilise an entire country towards liberalisation through privatisation (what a mouthful) why the hell not?
During my time as a Taylor Bennett Foundation intern, I met Jonathan Charles, the Director of Communications of this bank. As an avid supporter of the trade not aid approach, when he started to unfurl the workings of the EBRD to me, I listened attentively, taking everything in. And then I made a decision.
I was a recovering socialist, and the idea of a bank creating a new social class, was mind-blowing to me. I was impressed.
I know I've not been to kind to bankers or banks in my past blog posts, but maybe it's time to start looking at the other end of the spectrum; maybe it was time to stop ranting at bankers and banks for the imperfections of my world... maybe it was time to reassess my ideologies.
