Egypt to distribute free shares

By Christian Fraser
BBC News, Cairo

Gamal Mubarak has overseen many of Egypt's recent economic reforms

Egypt's ruling National Democratic Party (NDP) says it is to privatise state-owned companies and distribute free shares to all citizens.

The party has not yet announced which of companies would be privatised or when the plan would go ahead.

But President Hosni Mubarak's government say it will retain majority stakes in strategic assets such as iron, steel, transport and tourism.

The government has come under pressure this year over inflation and low pay.

The two have combined to make life much harder for the average Egyptian.

While the government says the economy has grown by almost 7%, the usual refrain is that this new wealth is not finding its way into the pockets of the country's poorest people.

Pending the agreement of the two houses of parliament, the government's latest plan aims to make people feel more included.

Driving the economy

Gamal Mubarak, the son of the Egyptian president, has overseen many of the country's recent economic reforms.

Some complain Egypt's new wealth is not reaching the poorest

He said the NDP had been working on this plan for two years, and that it had nothing to do with the global financial crisis.

In recent years, Egypt has sold stakes worth billions of dollars in state-owned companies, which has helped drive the economy of the most populous Arab country.

But with this sell-off, it plans to retain a controlling stake of 67% in those companies that operate in "strategic" sectors like cement, pharmaceuticals and textiles.

Opposition groups have called for an end to privatisations - some because they fear state firms will soon fall into foreign hands, others because they claim the process has been corrupt.

There is a perception here that some of the country's wealthiest businessmen have earned enormous profits from their cosy relationship with the government.