Osman Ahmed Osman, Egypt’s entrepreneurial tycoon, enjoyed a privileged status that cannot be attributed solely to his role as Sadat’s closest confidant, or even to his kinship by marriage with the president. Many Egyptians came to see him as Sadat’s alter ego, minus the latter’s presidential immunity.

Until shortly before his death, Sadat had denounced every attack on Osman as being directed at him personally, but the uproar occasioned by Osman’s recently published autobiography, My Experience, made this full endorsement no longer possible. Sadat had to accept Osman’s resignation as deputy prime minister.

On one specific issue, at least, Sadat cannot fully identify with Osman. There is a point beyond which he cannot officially disavow the Nasser legacy. He drew his legitimacy as president from the 1952 revolution. Osman is bound by no such constraint. His book is an outright condemnation of the two decades of the Nasser era which, he maintains, “left Egypt in a state of ruin that has taken Sadat ten years to put right.” Nasser is not mentioned by name once in the book’s 650 pages, but is disdainfully referred to throughout as “the previous rule,” to which the author attributes all the ills that befell Egypt in its recent history.

The son of a bankrupt grocer, Osman remained a local contractor in the Ismailiyya area and the Canal Zone until 1952. It was only under Nasser that “The Arab Contractors—Osman Ahmed Osman and Company” grew to formidable dimensions. Arab Contractors was encouraged to work and flourish throughout the Arab world. Unlike similar, even smaller, concerns, Arab Contractors was not, as the book alleges, nationalized during the big wave of nationalizations in 1961, but remained a private concern until 1964. Even then, Osman stayed on as chairman of the company.

This preferential treatment may have been a way for Nasser to obtain hard currency from Osman’s earnings abroad. Whatever Nasser’s motivations, Osman’s sudden outburst of hostility to him cannot be a reaction to discrimination. Osman was awarded an important contract in digging the turbine tunnels and constructing the body of the High Dam in the early 1960s. In 1970 he was commissioned to construct silos for the SAM missiles along the Suez Canal. During the “previous rule,” Osman was loud in his praise of Nasser, often taking out full-page advertisements in the Cairo papers to extol the virtues of his rule.

Osman’s takeoff did occur under Nasser, but in an environment outside and different from that of Egypt. He made his fortune in the Arab oil-producing states where labor was scarce, skills non-existent and oil money readily available. The emerging oil sheikhs built their credentials on ostentatious palaces and public buildings, a unique opportunity for a shrewd contractor with access to Egypt’s cheap labor and the West’s hardware. Osman “succeeded in breaking the monopoly of foreign companies in most Arab countries thanks to the low wages and high skill of the Egyptian worker.”

Nasser’s policies were determined by the realities of a country where labor was abundant and resources limited. To secure the nation’s political and economic independence, he had to embark on a revolutionary path toward development based on an adapted version of socialism, a planned economy, a leading state-owned sector and widespread nationalizations. This did not prevent Nasser from making use of the facilities offered by the Arab Contractors on a number of vital projects. Indeed, he created a number of autonomous administrations empowered with special authority to carry out specific tasks such as running the Suez Canal or supervising the building of the High Dam complex. But this remained the exception and could not become the rule.

Osman alleges in his book that “since the 1950s, I proposed to the ‘previous rule’ the idea of achieving complementarity in all fields between Egyptian skills and Arab money, in the aim of securing development and modernization throughout the Arab world.” But as Osman puts it, “The previous rule was too busy squandering Egypt’s money on conspiracies in the Arab states, instead of encouraging them to invest their money in Egypt…. Things only changed under President Sadat who established inter-Arab relations on a basis of complementarity beneficial to all parties, without intervention in the affairs of others.”

It would be wrong to dismiss Osman’s criticism of the Nasser years as a vulgar volte face. It is a reevaluation made in retrospect from the vantage point of Sadat’s “open door” policy. It also fits the perceptions of the Arab beneficiaries of oil wealth, for whom the West is the oil customer and partner, not the colonial enemy. Contrary to Nasser’s conception, Osman’s—and also Sadat’s—is that of identification with the West and integration into its orbit, not that of independence from it.

This outlook determines Osman’s description of Nasser’s nationalizations as “the greatest blunder ever committed” which “wreaked havoc on Egypt,” “made out of it a big prison” and put its productive capacities “in the hands of a bunch of thieves and ignoramuses.” For Osman, the only way “to correct the mistake of the public sector is to give it a thorough shake-up and to manage it in the way the private sector [i.e., Arab Contractors] is run.” Nasser did not eliminate capitalism, but only clipped its parasitical extensions. He protected national capitalism, striving to make the private sector complementary to the public sector and an integrated element in Egypt’s planned economy. Osman advocates making the public sector an appendix of the private sector, not to say of the Arab Contractors, which has now evolved into a holding company for some 150 affiliated or connected companies in Egypt alone. Osman holds his empire up as a model for what Sadat’s Egypt should become.

Osman’s Values

In fact, the private/public sector he runs has become a breeding ground for middlemen, speculators and adventurers. Like Sadat, who took upon himself the role of “head of the Egyptian family,”Osman makes much of the “family spirit” prevailing in the Arab Contractors, where he describes himself as a pater familias rather than a boss. Like Sadat, he preaches a doctrine of love as opposed to envy [i.e., class struggle]. Osman writes: “I have learned to keep a marble dam between myself and envy.”

Again like Sadat, he attributes his success to his piety. He proclaims his affiliation to the Muslim Brothers, but hastens to add that he does not countenance their use of terrorism. It is a point of pride with him that the Arab Contractors was a refuge in Nasser’s time for many Muslim Brothers on the run. With the Egyptian regime now facing a growing wave of Islamic opposition, he is trying to use these credentials to win the Brothers over to the idea that Zionism is a lesser evil than communism.

In the concluding sentence of his book, Osman predicts that it will open a new chapter in his life. It did indeed, but not the one he expected. Instead of enhancing his status and paving the way to the premiership, the whole enterprise exposed a power struggle at the summit of the Egyptian establishment that had hitherto remained a matter of conjecture. It was already being said that the removal of Mustafa Khalil as prime minister in 1980 had been accompanied by the removal of all ministers not loyal to Osman. The cabinet, since then headed by Sadat himself, had been described as a pro-Osman cabinet, despite the fact that he himself was not part of it. In January 1981, the Jerusalem Post alleged that a major government reshuffle was imminent, aimed essentially at “thwarting a power drive by the vice president, Mubarak” who was “engaged in a power struggle with Sadat’s closest associates, if not with Sadat himself.”

Only a minor reshuffle did occur. The most interesting feature was the appointment of a minister of state for presidential affairs charged with assisting both the president and the vice president. It seemed that the newly created cabinet post was to keep an eye on the vice president rather than to assist him. A few days later, Osman was appointed deputy prime minister, the post he lost in the wake of the uproar provoked by his book four months later.

In his book, Osman sets out to draw the younger generation into embracing his entrepreneurial philosophy as the materialization of Sadat’s “open door” policy. He presents himself as “a man with a mission in life” who does not have to run after money but towards whom money gravitates. His experience is presented as a way for every Egyptian “to become a millionaire.” Far from discrediting Nasser, it provoked a resurgence of Nasserism. Within Sadat’s own establishment, it accentuated the demarcation line between those who oppose Osman in the hope that the system can be streamlined, rationalized and prevented from losing touch with reality, and those who, under Osman’s tutelage, threaten to undermine it with their excesses.

It is difficult to imagine that the book would have been published without Sadat’s prior approval. Was the reaction it provoked a surprise for him, or did he authorize its publication to enable him to clip Osman’s wings and restore a certain balance between the contending factions in the power game?

How to cite this article:

Mohamed Sid-Ahmed "Sadat’s Alter Ego," Middle East Report 107 (July/August 1982).

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