The Role Of Foreign Capital In Long-Term Development

Foreign Capital

This study was prepared in response to an invitation to the first Conference of Egyptian Economists which took place on March 25 th 1976. My choice of the subject was decided by two main considerations. The first was my previous research in long term development and the contribution of foreign resources, especially foreign loans to the process of growth. The second was my feeling that the role of foreign capital seemed to be exaggerated to the extent that it may lead to relaxation of other conditions of growth, normally given more weight when foreign resources do not seem forthcoming in sizable amounts. When I undertook the study I did have some expectations that the outcome would not be quite rosey. However, I did not expect it, either, to be that gloomy. The results were presented to the conference in time in summary form. Owing to the nature of the study, I have prefered to give full details of the mode is used and the numerical calculations for further reference. The summary in Arabic is attached. to this Memo.