Tantawi controls 40% of Egyptian economy

Cairo’s military courthouse is a nine-story slab of white concrete that rises just off the main road in the Nasser City district, the neighborhood named after the colonel who seized power following Egypt’s 1952 coup.

Under Tantawi’s stewardship, the military controls a labyrinth of companies that manufacture everything from medical equipment to laptops to television sets, as well as vast tracts of real estate, including the Sharm el-Sheikh resort where Mubarak owns a seaside palace. Robert Springborg, professor of national security affairs at the Naval Postgraduate School in Monterey, has called the Egyptian military “a business conglomerate, like General Electric.” Tantawi is effectively the corporate head of this empire, with command of as much as 40 percent of the Egyptian economy.

Tantawi saw the stolid, careful Mubarak as the guarantor of Egyptian stability, I was told. Yet Mahmoud Zaher, sixty-one, a former high- ranking officer in Egyptian intelligence, told me that the relationship between the two men had deteriorated sharply in recent years. The catalyst, he said, was “Suzanne Mubarak’s scheme” to elevate her eldest son Gamal to the presidency. At the end of the 1990s, Gamal returned from a banking job in London and was given an entry-level position in the ruling National Democratic Party (NDP). Soon he was selling off large portions of state-owned enterprises to business cronies—and NDP stalwarts—such as Ahmed Ezz, who gained a near monopoly over steel production (and who was one of the first party figures jailed after the revolution).

Tantawi, along with Mubarak’s chief of security, General Omar Suleiman, bitterly opposed the plan to have Gamal succeed Mubarak, and for several reasons. The military leaders have an institutional aversion to a civilian taking power in Egypt; they were convinced that Gamal lacked the intellect for the job, and they feared that his privatization schemes would dismantle the military’s enormous business holdings. “They went to Mubarak repeatedly, and they told him, ‘Gamal is useless,’” Zaher told me. “‘He is not correct, he is not acceptable to the people.’ They handed in their resignations several times, but Mubarak turned them down.” Distrust and discord between Tantawi and Mubarak grew intense, Zaher said, “but anybody in such a high position would be careful to conceal it.”