Once-mighty Egypt is now reduced to a hostage of the IMF & Gulf debtors

Once-mighty Egypt is now reduced to a hostage of the IMF & Gulf debtors
Anger is growing among Egyptians who can barely make ends meet and fear for their future amidst an economic crisis. However, given the considerable state repression it is difficult to tell whether they will rise up, writes Emad Moussa.
6 min read
20 Feb, 2023
With Egypt's economy in crisis, the currency in freefall and inflation skyrocketing, the poor have been hit hard but the middle class is also teetering on the brink. [GETTY]

From the minute I stepped outside Cairo International Airport heading to downtown Cairo to the moment I left the country, I was inundated with cynical political commentary on Egypt’s economic crisis and the deteriorated pound.

Egyptians are quick with a joke. They would paint a clear picture of the situation and talk down their government without naming names or speaking about the specifics, often with a touch of humour. It is perhaps a skill they have honed through decades of military dictatorship, censorship, and a long series of economic and political turmoil.

This bubble of free speech has provided breathing space for the disenfranchised folks that you may find at, say, Cairo’s tucked-away cafe shops; among taxi drivers; pedlers and small business owners; all the way to university professors, intellectuals, and physicians.

But make no mistake, Egyptian cynicism has always been a precise indicator of the country’s socio-political condition. And, on my last trip early this month, the commentaries certainly felt angrier, possibly more so than the phase shortly before the toppling of former President Hosni Mubarak in February 2011.

''Today, at 25% inflation, millions of families have seen the prices of basic goods slip away beyond their reach, and businesses struggle to stay afloat with severe shortages in foreign currency. Families considered part of the middle class are now on the brink of poverty, with many already seeking help.''

“Mubarak was a dictator super-glued to the presidential chair,” a taxi driver told me, “but he was still in touch with the street. At tough times, he would loosen the rope and let people vent a bit. But he never dared to come near our daily bread as this guy [Sisi] has done.” He noted that under Mubarak’s rule, “the Egyptian pound (LE) was stable, at $6-7 max. Look at it now, it is 30LE plus…a total disaster.”

Last year, the Egyptian government drew up plans to shrink food subsidies in the face of global inflation. They increased the prices of basic commodities, including wheat. That pushed up the price of the basic loaf of daily bread consumed by two-thirds of the 104 million Egyptians, and which remained constant at 5 pennies ($0.003) since the 1980s.

When Sisi ordered prices of unsubsidised bread to be fixed, it ignited speculations on the regime’s fear of riots similar to those of 1977 when Sadat attempted to scrap food subsidies, only to reverse the decision four days later under public pressure.

Today, at 25% inflation, millions of families have seen the prices of basic goods slip away beyond their reach, and businesses struggle to stay afloat with severe shortages in foreign currency. Families considered part of the middle class are now on the brink of poverty, with many already seeking help.

“Sisi has buried Egypt under mountains of debt for generations to come; made us hostages to the IMF and some Gulf states; and sold Egypt’s core assets to foreigners. Just for his personal glory,” an Uber driver and graduate of pharmacy told me angrily.

“What am I going to do with all his superfluous bridges and megastructures? Feed my family concrete? The president is just another Pharaoh with a giant eraser, wiping off the ‘pyramids’ of his predecessors to remodel history in his own image, thinking Egypt is his personal property,” he grumbled.

It is well beyond the incompetence of one individual and the poorly executed policies, others commented. The problem stems largely from a long legacy of dictatorship, corruption, and hijacking of the country’s riches solely to strengthen the army economy and beneficiary oligarchy.

Egypt’s military controls much of the economy, with assets stretching from supermarkets and petrol stations, to food factories, cement plants, hotels and resorts, and transport. This has also resulted in the army crowding and weakening the private sector, and arguably scaring off investors.

Yet, it is not the increased visible poverty that shows Egypt’s predicament, but rather the new megastructures, cities, and communities built in the past ten years. While impressive, they accentuate Egypt’s growing inequality.

On one hand - an Egyptian friend cynically remarked - there is now masr (Arabic for Egypt), while on the other, there is Egypt (the English name). The first is where most Egyptians live, struggling to meet their daily needs or receive proper healthcare, and whose kids go to overcrowded schools. The second is where the military elite, along with the wealthy and upper middle class reside, and who use private hospitals and send their kids to international schools.

“The people of masr work for the people of Egypt,” she commented.

This could not be more obvious than in New Cairo City (the new capital). The city was constructed from scratch at a record speed nearly 25 km east of Cairo. It is undoubtedly a top-class modern urban community, declaredly designed to take the pressure off the struggling, overcrowded ancient capital. However, like many of the new urban communities, it is also filled with gated compounds, guarded villas and flats where only residents and their guests can enter.

Proponents of the idea see it as a progressive change in Egypt’s “culture of crowdedness,” which was arguably triggered by the concentration of the population along the Nile Valley within a limited geographical space. Albeit this culture heightened Egypt’s collective security and identity, it has negatively impacted infrastructure, privacy, and social mobility.

In addition to deepening classism, others argue, the new urban model points to a disturbing culture of fear and isolation resulting from a widening socio-economic gap between the downtrodden majority of masr and the well-off minority of Egypt.

On the outside, it appears the congested situation is building up toward implosion. Yet, repeated attempts, the last of which was in November, by the opposition abroad to mobilise the public against the regime have seen little or no reaction.

The idea of another uprising does not seem appealing to many Egyptians, who believe Egypt paid a dear price with its security and stability, even blood, in the chaotic years following the Arab Spring. Others argue most Egyptians are suffering from political fatigue, now preferring to be members of the ‘couch party,’ to observe but not react as long as they can still feed their families.

This is certainly helped by the state’s iron grip; arbitrary arrests and enforced disappearances, control of the media; and close monitoring of any activities that may develop into protests or any other form of dissidence.

Tahrir Square, the symbol of the 2011 January uprising against Mubarak, has now been refurbished and redesigned, with Pharoah monuments erected in the middle and open spaces reduced, seemingly in part to limit the efficacy of any gatherings in the area.

Limiting the opening of mosques to only the prayer times, a local imam told me, is another policy in the same direction. This is accentuated by the presence of police vehicles near many of the major mosques – and squares - in the city.

It is hard to predict the Egyptian trajectory as people are now trapped between a military dictatorship and economic difficulties, and their fear of chaos in an otherwise homogenous society should they decide to stand up to the regime. But if there is a constant in Egyptian history, it is that the people’s high resilience and patience has its limits.

Dr Emad Moussa is a researcher and writer who specialises in the politics and political psychology of Palestine/Israel.

Follow him on Twitter: @emadmoussa

Have questions or comments? Email us at: editorial-english@newarab.com

Opinions expressed in this article remain those of the author and do not necessarily represent those of The New Arab, its editorial board or staff.