Money laundering and drug trafficking could create an illusory business boom in Egypt and seriously harm the economy, according to a report said to be on the desk of Egyptian Prosecutor General Maher Abdel Wahed.
Wahed, according to unofficial sources, has received the report from experts at the National Criminal and Social Research Center, representatives from the banking sector, and staff from prosecutor general’s own office.
According to the Cairo-based daily Al Arabi, the study, Laundering of Money Generated by Illegal Drug Trafficking, says drug trafficking and money laundering in Egypt is worth up to five billion pounds.
The study calls for amending Egypt’s banking and credit laws to confront the problem, and warns that dirty money could create an illusory economy boom without real productive operations.
Last month, an Egyptian economist said that despite government denials, the international community was laundering money in the North African country, and laid the blame on the world as a whole.
“The charges [that money is laundered in Egypt] are like a promotional advertisement among swindlers and smugglers,” the head of the Egyptian Political Economists Society, Ibrahim Al Issawi, said in response to an international watchdog group’s charge that Egypt was not cooperating in the fight against dirty money.
He added that responsibility for the problem lay with the entire international community.
In the same report, banking expert Mohammed Nooriddin pointed out that the Egyptian monetary authorities had already created rules and control measures to confront the problem.
“What we need is strict implementation of these rules,’’ said Nooriddin, adding that the most dangerous potential consequence for the national economy was the movement of laundered money in a way he described as “hot money.”
He said “hot money” entered the targeted country and then left, creating confusion in the markets and thereby disrupting them.
Nooriddin said that developing countries were encouraging all types of money to cross their borders due to their economic problems, and said these counties should be helped to fight money laundering by providing them with sufficient resources such as soft loans.
Observers say that money laundering in Egypt occurs in the tourism and hospitality sectors, as well as via the stock market.
An international watchdog group involved in the fight against dirty money recently added Egypt to its amended list of uncooperative countries.
But the Egyptian Ministry of Economy responded by denying the existence of the problem and said Egypt had ended up on the list due to a lack of legislation to combat money laundering.
The ministry said it was working on passing a law in the area – Albawaba.com
