(photo credit: AP [file])
Egypt President Hosni Mubarak on Wednesday said he was "struggling" with the government to provide anticipated salary bonuses for public-sector workers, offering some of the strongest indications yet about how the global recession was affecting the Arab world's most populous nation.
In an annual Labor Day speech, Mubarak said the country would be able to weather the global downturn. But he also indicated the annual bonuses would be considerably less than previous years and that his pledge to provide about half a million jobs per year would probably not be met this year.
The somber tone voiced by Mubarak, who has been president since 1981, was a surprisingly candid assessment of the country's difficulties even as other top officials have repeatedly stressed Egypt's ability to weather the current downturn.
Mubarak said he was "struggling" with the government to provide the roughly 6 million public-sector employees with the so-called "social allowance" - essentially a salary bonus.
Last year, faced with protests over surging prices, the government provided public-sector workers with a 30 percent pay hike. Earlier raises had ranged between 10% to 15%.
Mubarak stopped short of providing an exact figure, but indicated it would be at least 5% or 6% this year.
Egypt had enjoyed an average economic growth rate of about 7% for the past three years. But officials, who months ago said they were hoping for growth of 5% to 6%, are now projecting a further contraction to 4% as the country's key revenues sources - tourism, the Suez Canal, foreign investment and worker remittances - take a pounding.
Mubarak described the world economic crisis as a "tornado," saying he follows, "day by day, the decline of our exports of goods and services, the decline of the local and foreign investment, tourism revenues, the Suez canal and remittances of Egyptians living abroad."
Mubarak indicated that pledges to provide half a million jobs per year - seen as key for growth in a country with an expanding population - would fall short this year, noting that the declining revenues would "temporarily hurt our economy's capacity to provide the job opportunities."
In an apparent bid to stave off protests similar to the unrest last year, Mubarak appealed to workers to resort to dialogue instead of walkouts.