CAIRO, July 10 (Xinhuanet) -- Egyptian President Hosni Mubarak's appointment Friday of Ahmed Nazef as the new prime minister is apparently a move designed to revive the sluggish economy in the most populous Arab country.

    The appointment of the 52-year-old IT technocrat, who is also minister of state for telecommunications and information in the outgoing government, may signal a shift in the course of economic growth -- moving toward a knowledge-based economy from the traditional one, local analysts said.

    According to leading Egyptian newspaper al-Ahram, Nazef will form his cabinet within 48 hours, but the ministers of national defense, foreign affairs, interior and justice will be named by Mubarak. In addition, the outgoing Prime Minister Obeid is expected to assume the post of economic advisor to Mubarak.

    "New faces are expected to join the government to inject new blood into the public performance to help catapult Egypt into an era of technology and information," the newspaper said.

    The new prime minister-designate graduated from Cairo University in 1973 with a degree in engineering. Three years later,he obtained a master's degree in electric engineering in the same university. In 1983, he got a doctorate in computer engineering atMcGill University in Canada.

    Nazef's government could unveil definite and carefully-suggested programs which would give priority to the areas of employment, education and development of free trade zones, the paper predicted.

    Obeid's cabinet resigned at a time when the Egyptian economy, hit hard by the volatile Middle East situation and the Sept. 11 terror attacks on the United States, lacked growth stimulus both at home and abroad.

    In addition, the public have been worried about the price hikesof basic commodities, caused by the devaluation of the Egyptian pound, which has lost a quarter of its value since the government freed the foreign exchange market in January last year. Local economists claim that the devaluation has sparked a rise in the cost of living between 10 to 20 percent.

    Furthermore, the 2003-2004 budget projected a deficit of 28.7 billion pounds (about 4.81 billion US dollars). The Egyptian government expects this year's Gross Domestic Product to grow by 4.5-5 percent. But the International Monetary Fund (IMF) sees a growth of only 3 percent, compared with 2.8 percent in 2003.

    Egypt, however, needs a 6 percent economic growth to create 600,000 jobs a year to meet the demand of new job seekers and the unemployed, the IMF said. Enditem