Abstract
As Egypt had the earliest modern banks in the Arab Middle East, it seems appropriate to examine its financial institutions in detail, even though initially they were foreign rather than locally owned. It was in any case the rapid penetration of foreign banks which eventually resulted in moves to found indigenous institutions, whose business practices correspond to those found in the West. That Egypt should be the instigator of modern banking in the Arab Middle East is not altogether surprising, as the country boasted the largest number of educated people, had considerable commercial dealings both internally and externally, and possessed an economic and financial sophistication not found elsewhere. Despite the fact that nationalism in Egypt was strong even in the early nineteenth century, foreigners took most of the initiative in financial dealings, and there was a marked absence of local competition.1 It was only in the 1920s that a belated attempt was made to emulate European banking practices and establish a wholly indigenous institution.
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Notes
Mohammed Ali Rifaat, The Monetary System of Egypt (London: Allen and Unwin, 1935) pp. 77–8;
David S. Landes, Bankers and Pachas (London: Heinemann, 1958) pp. 67–8 and 136;
M. Kamel A. Malache, Etude Economique et Critique des Instruments de Circulation et des Institutions de Credit en Egypte (Paris: Presses Universitaires de France, 1930) pp. 251ff.;
Pierre Arminjon, La Situation Economique Financière de L’Egypt (Paris: Librairie Générale de Droit et de Jurisprudence, 1911 ) p. 422.
E. R. J. Owen, Cotton and the Egyptian Economy 1820–1914 (London: Oxford University Press, 1969) p. 83.
Albert Baster, “The Origins of British Banking in the Middle East”, Economic History Review, Vol. V, No. 1 (October 1934) pp. 80–1.
For further details of British policy see E. R. J. Owen, “The Attitudes of British Officials to the Development of the Egyptian Economy, 1882–1922”, in M. Cook (ed.), Studies in the Economic History of the Middle East (London: Allen and Unwin, 1970).
See also Anon., Histoire Financière de !’Egypt depuis Said Pacha, 1854–1876 (Paris: Guillaumin et Cie, 1878) pp. 209ff.
Rifaat, op. cit., pp. 105–9. All of Chapter IV of this work is concerned with the National Bank. Theodore Rothstein, Egypt’s Ruin: A Financial and Administrative Record (London: A. C. Fifield, 1910) pp. 241–72, discusses the role of Lord Cromer.
J. Ducruet, Les Capitaux Européens au Proche-Orient (Paris: Presse Universitaires de France, 1964) p. 346;
Fouad Sultan, La Monnaire Egyptienne (Paris: Librairie Nouvelle de Droit et de Jurisprudence, 1914) pp. 106–13, describes the role of the National Bank of Egypt in managing the note issue.
Details given by Marius Deeb, “Bank Misr and the Emergence of the Local Bourgeoisie in Egypt”, in Elie Kedourie (ed.), The Middle Eastern Economy: Studies in Economics and Economic History (London: Frank Cass, 1976) p. 70.
Fawzy Mansour, Development of the Egyptian Financial System up to 1967: A Study in the Relation between Finance and Socio-Economic Development (Cairo: Mn Shams University Press, 1970) p. 26.
Albert N. Forte, Les Banques en Egypte (Paris: Librairie Technique et Economique, 1938) p. 149.
Hossam M. Issa, Capitalisme et Sociétés Anonymes en Egypte (Paris: Librairie Générale de Droit et de Jurisprudence, 1970) pp. 241ff. gives details of Bank Misr’s cartelisation policy.
A detailed account of the structure and operations of the Banque de Syrie et du Grand Liban is given by Said B. Himadeh, Monetary and Banking System of Syria (Beirut: American Press, 1935) Chapter XI, pp. 137ff.
One commentator notes how in the inter-war period there was little lending for agriculture or industrial projects: see Edmund Y. Asfour, Syria: Development and Monetary Policy (Cambridge, Mass.: Harvard University Press, 1959) pp. 60–2.
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© 1983 Rodney Wilson
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Wilson, R. (1983). Emergence of Modern Banking. In: Banking and Finance in the Arab Middle East. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-04817-5_2
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