Separately, the board chairman of the National Bank of Egypt, the country’s largest state-owned bank, said the workers who had been protesting were caught up in the fever of the uprising against Mubarak, but were entitled to demand better pay and benefits.
“They believe that it’s an opportunity — if they had any complaints and demands — and that there’s a higher probability of getting them answered,” Tarek Amer, the board chairman of the National Bank of Egypt, said.
But Amer, who denied media reports that he had resigned, also said the workers were justified in bringing attention to contract inequities and to demand permanent jobs, instead of temporary contracts that give access to benefits such as health care.
“We’re generating more than 3.7 billion pounds ($638 million) in net income before tax, and two billion ($340 million) in net income after tax,” Amer said, adding that the bank could afford to pay the projected 30 million to 40 million pounds ($5.1 million to $6.8 million) that it would cost to boost salaries and provide other benefits to workers.
The strikes fueled investor uncertainty that had built since protests began on Jan. 25 to demand Mubarak’s ouster.
He resigned on Friday.
The Egyptian Exchange’s reopening was already delayed from this past Sunday to Wednesday, and the latest delay could stoke investor fears in a country whose short-term rosy economic forecasts of weeks earlier are now dimming quickly.
The stock market’s board decided to keep the exchange closed on Wednesday and Thursday — the last two days of the work week — “until work is back to normal in the banking sector,” according to a statement released by the bourse.
It did not specify when the exchange may reopen.
The exchange has been closed since Jan. 28 after its benchmark index lost about 17 percent in two consecutive days of trading following the start of 18 days of protests that led to Mubarak’s ouster and the military’s seizing of control.
The announcement about the delay in restarting the exchange came a day after the Central Bank ordered banks to close on Monday as the worker unrest mushroomed, with thousands of employees at various public sector joining colleagues from other sectors ranging from textiles to EgyptAir, the national carrier. Workers at that company succeeded in having the head of the carrier removed by Egypt’s civil aviation minister late Sunday.
Economists warned that the push by the government, and public sector companies, to meet the demands of the workers was a double-edged sword. While they might help curb the demonstrations, they would also strain the government budget at a time when Egypt is likely to face significant drops in foreign investment and tourism revenues — two of its main foreign revenue sources.
Egypt’s new finance minister, Samir Radwan, was quoted by Egyptian media as saying that economic growth projections for the current year could drop to slightly below 4 percent from a projected 6 percent. Other analysts have given significantly lower projections.
Similarly, analysts expect that the government’s plans to boost salaries and pensions for civil service employees and pensioners by 15 percent, along with other programs aimed at minimizing the blow from the unrest to Egyptians, will deepen the budget deficit well past the anticipated 8.1 percent of GDP.
“I doubt that there is sustainability in this situation,” said Abdel-Fattah El-Gabali, a monetary policy expert with the Ahram Center for Strategic and International Studies in Cairo. He said the government had hoped, before the unrest, to start scaling down the size of the civil service and the public sector in which salaries consume about 25 percent of Egypt’s budget.
“Monetary policy is going to be very complicated in the coming period,” he said. “After the elation over the revolution (dies down), you will have a sharp blow from reality.”
