Egypt's Severe Economic Crisis Sparks Harsh Criticism Of Regime's Economic Policy, Calls To Topple Regime On November 11

Introduction

In recent years, Egypt has been suffering a severe economic crisis, [1] expressed by a sharp drop of the Egyptian pound against the dollar, rising prices, a shortage of staple foods such as rice, sugar and baby food, and profiteering in these commodities.[2]

In order to overcome the economic crisis, the Egyptian government and state institutions have formulated an economic reform plan comprising a series of measures, including cutting expenditures of government ministries;[3] ending subsidies on 95-octane gasoline, which caused gasoline prices to spike;[4] and floating the Egyptian pound, which caused its value to drop even further against the dollar.[5]

These measures have sparked rage among the Egyptian public and complaints about rising prices and low living standards in the country. For example, in some Egyptian governorates public transport drivers went on strike in protest of the rise in gasoline prices, angering the public and even triggering fistfights between drivers and passengers.[6] Students at the American University in Cairo demonstrated against the measure of floating the pound which, they said, caused their cost of living to rise.[7] Criticism of the government's measures was also voiced by members of the parliament's energy committee. They protested the sudden decision to raise gasoline prices, which they said had been taken without consulting them.[8]

The rage among the Egyptian public was also reflected in videos about the economic crisis that were circulated via the media and social networks and went viral. On his show on the Al-Hayat channel, host 'Amr Al-Leithy aired a video in which a tuk-tuk[9] driver ranted against the economic situation. After the airing of the video, the security services in the Sohag governorate initiated a hunt for the driver, who apparently disappeared for fear of persecution. Another video presented the difficulties of a shop owner in Port Said.[10] In response to these videos, journalist Ahmad Moussa, who is close to the regime, circulated a video showing an interview with another tuk-tuk driver who denied there was an economic crisis in Egypt. [11]

Another expression of the popular rage against the government's economic policy was the establishment of the Ghalaba Movement ("Movement of the Poor"), which has called on Egyptians to take to the streets on November 11, 2016 in order to topple the regime due to the economic situation.[12] In an October 28, 2016 post on its Facebook page, the movement's spokesman, Yasser Al-'Omada, laid out the movement's beliefs and goals, including: "liberating all the political prisoners and prisoners of conscience; arresting all the corrupt regime loyalists who have stolen the money and the resources of the poor and nationalizing all the property of these criminals...; abolishing the Civil Service Law and raising civil servants' salaries; assisting the unemployed; seizing lands that were sold or given to military and police officers and businessmen who are close to the corrupt regime and giving them to young people...; returning the army to its bases and confining it to developing and manufacturing arms and defending Egypt's borders, rather than taking part in the regime or in political activity, for [the army] is a state institution, not a state within a state..."[13] In a video posted on the movement's Facebook page, Al-'Omada read out a pledge and urged the Egyptian public to repeat it as a commitment to join activity towards toppling the regime.[14] His call elicited positive responses from many others on Facebook.

Though the Ghalaba movement stressed that its members are "Egyptians unaffiliated with any particular party, organization or political entity, whose sole commitment it to their homeland, where they wish to live in dignity like all other nations," regime supporters claimed that the movement members were Muslim Brotherhood (MB) activists and supporters of the January 25, 2011 revolution trying to spark chaos in Egypt.[15]      

Egyptian regime officials tried to repel the criticism and encourage the citizens in light of the grave economic situation. Addressing the First Youth Conference, held in Sharm Al-Sheikh under his sponsorship, Egyptian President 'Abd Al-Fattah Al-Sisi said that, in his childhood, his family's refrigerator had nothing in it but water.[16] In order to quell the public protests, the army distributed subsidized food packages to the citizens.[17]

The heated debate on the economic crisis also found expression in the Egyptian press. Many Egyptian paper editors, including some close to the regime, leveled harsh criticism at the government's economic policy. In an interview with the press editors, Al-Sisi responded by accusing the media of publishing reports based on partial or false information and thereby harming the state, and also complained that the discourse on social media sowed frustration among Egyptians. He added that the role of the media was to give people hope, rather than the opposite.[18]

The editorial board of the government daily Al-Ahram, including chief editor 'Abd Al-Hadi 'Allam, echoed Al-Sisi's sentiments. Articles in the daily defended the government's policy, and claimed that the harsh criticism against it was incitement aimed at triggering popular protest and instigating further upheavals in the country.

This report reviews the articles criticizing the economic measures of the Egyptian government, and the response articles in Al-Ahram.   

Egyptian Writers: The Government Is Helpless In Dealing With The Disastrous Economic Crisis

Egyptian Newspaper Board Of Trustees Director: Government Handling Of Sugar And Bread Crisis Is A Stratagem Aimed At Raising Prices

Muhammad Amin, director of the board of trustees of the Egyptian daily Al-Masri Al-Yawm, criticized the government in general, and specifically Egypt's minister of supply Muhammad Meselhi, pointing out the sugar industry's mishandling of the crisis and the mistakes in dealing with food merchants and smugglers. He wrote: "How Egypt is managed remains an unknown. Who is carefully considering [the situation] and making decisions about it? How do crises suddenly spring up and just as suddenly disappear? Even the innermost of the inner circles is clueless and lacks information... This is as true for the dollar market as for the sugar market. We thought the new supply minister[19] would rescue us from [the crisis] we are in, but here we are, sinking even [deeper]. He neither saved us nor sent us a lifeboat...

"We have seen such a miracle in recent days - the dollar is soaring and fooling everyone, and no one can stop it. [The price of] sugar is rapidly rising... and no one is stopping it. Egypt is being run without a government to confront the chaos. The strange thing is that this 'savior minister' submitted a report to Prime Minister [Sherif Isma'il] stating that the [sugar] reserves will last until March. [If that is so,] where are they? [Officials] are saying the same things we are about the merchants' greed - [but] aren't you the government and don't you know every detail about what is happening in the country?

"And suddenly [they say] that the market is being starved of sugar - the only sweet thing in our lives - in order to drive up its price. Yesterday, Minister Muhammad Meselhi issued a directive stating that the Ministry of Supply would sell sugar to consumers at six Egyptian pounds per kilo, and would continue providing it to [food subsidy] card holders at five Egyptian pound per kilo. That means that this was a government stratagem for increasing the price, and people surely realized this...

"The strange thing is that the minister is justifying this by saying that his decision [to set prices at six Egyptian pounds] was aimed at controlling prices and regulating the markets, as well as reducing smuggling, monopolies, and price manipulation.

"I openly ask Minister Meselhi: Don't you [government officials] know who the merchants are, and don't you know where the monopolies are?... There are laws for dealing with monopolies... Is it conceivable that you would not know who the smugglers are? Or that you would not know who operates the monopolies? Where are the oversight and regulatory mechanisms? People are saying that what happened was just for show.

"Mr. Minister, did the state, with its much-vaunted capabilities, fail to oversee the markets before it raised prices? And can it now miraculously curb smuggling and monopolies after deciding to raise the prices? Will reserves suddenly appear following the ministry's decision - or should we pound the pavement [searching] for a kilo of sugar? ...

"Besides the loaf of bread and the sugar, all [prices] have been manipulated - whether it was manipulation, just for show, or for taking the [public] pulse, this nearly set Egypt on fire..."[20]

Poster on the Ghalaba movement's Facebook page calling for protests on November 11 (Facebook.com/ghalaba2016, November 8, 2016)

Egyptian Newspaper Board Of Trustees Director To Al-Sisi: Reassure The People About Our Economic Situation

In another article on the crisis, and the calls for November 11 protests, Muhammad Amin demanded that President Al-Sisi speak to the people to reassure them, given the economic pressures they are experiencing. He wrote: "No one but the president himself should speak at this time - not the prime minister or anyone else - just the president. Today's situation requires that he speak to the people. I am not saying that he should do so from parliament, but directly to the public - and not at a ceremony inaugurating some project. The people's courage has surpassed expectations, and their [willingness to] sacrifice should be actively encouraged. If I were the president, I would have done this without delay.

"Mr. President, the people have never before needed you to appear as they do now, and you have never before needed to speak openly to them as you do now. The people want to be calm about what is happening around them - come tell them about it. Tell them how important it is for us to undergo surgery to remove this cancer. Explain to them how important this treatment is... It is in your hands. Open a door of hope for the young people, Mr. President.

"Mr. President, I am not demanding that you speak in order to thwart the attempts to incite against Egypt. Much like you, I do not fear the so-called 11/11 [November 11 protests]. You have shown that you do not fear the calls to protest, and that you are not apprehensive about the calls of incitement following your authorization of immediate [harsh economic] measures. You must know that most of the people stand with you, and they need you to be open with them in all matters. It is their right to know...

"Mr. President, many experts are predicting a wave of investment and tourism, and an economic revival for Egypt. [But to hear it coming] from them is one thing, and [to hear it coming] from you  is another. Your words have credibility with the public and will ease the pressure on the security apparatuses [who must cope with the protests]. A regime cannot be based on the fist of the security apparatuses. The solution lies first and foremost in honesty and [information] sharing. You alone can thwart these incitement attempts...

"Mr. President, if I were in your place now - and who would want to be? - I wouldn't wait another day... Speak to the people. First thank them for their courage, and then speak to them openly. Then we will strip these misguided organizations of the opportunity [to harm Egypt]..."[21]

Magazine Editor: The Government Must Set An Example For Austerity Measures And Economic Reforms

Ibrahim Khalil, editor of the government Roz Al-Yousef weekly, also criticized the Egyptian government, stating that it had been remiss in regulating the markets and eliminating food industry monopolies. He wrote:

"In its next session, the Sherif Ismail government must take steps to reduce [expenditures], especially in the prime minister's office, and must also apply these measures to all government offices and travel [expenses], in order to set an example of the austerity measures and economic reforms that it would roll out in the coming period.[22]

"However, the government must not harm the regular income of civil servants who have become impoverished due to rising prices and to the daily, weekly, and monthly pressures that surprise citizens [ever so often], whether in the form of a shortage of some product, or a price rise of another. In general, the poor have nothing left that can be harmed by economic reforms...

"The demands and the suffering [caused by] the economic reform should be borne by those who can bear it - the wealthy - since this is a fundamental [principle] of the social justice that people have demanded for so long.

"Additionally, the Egyptian government and prime minister should issue directives to all governors in Egypt stating that their decisions must be made transparently and objectively, and that they cannot rescind their promises to people - in order not to leave the door open for the terrorist MB movement to fan the flames and incite against the state, as happened in Port Said..."[23]

"The incitement and the spread of rumors have not stopped for a single moment, and [in this climate] any misstep or random act is leveraged [by terrorists to prompt] people to leave their work, take to the streets, and protest, so that the [Twitter] users and terrorists can paint [a picture] for the world showing that the country is chronically unstable.

"In their daily lives, people neither notice nor care about... the distractions peddled by the terrorist brigades that launched their 11/11 [campaign]. The [people] have chosen stability and security, and have great confidence in the president and in the positive achievements such as the large-scale national projects...

"But on all these issues, it is the citizens who pay the price of the [government's] trembling hands and lack of vision, [or of its] hesitance in making painful decisions. It is time for us to look for new and original ways to properly and quickly solve our problems. To the ones who are demanding that people take to the streets, we say that it is too late to do so, because the street can never give them a carton of milk, a job, or reduced prices for staple [food] products. Those who preach this are far removed from the people's problems; they live in skyscrapers, surrounded by creature comforts, and are themselves incapable of taking to the streets. All they do is incite others.

"This is Egypt's fate. There are unending attempts to pull it backwards, but that is not possible, because anyone betting that the 11/11 [protests] will succeed will be surprised to discover that all levels of society agree on stability..."[24]

Daily Editor To Egyptian President, Government: Act Now Before Society Explodes

'Imad Al-Din Hussein, editor-in-chief of the independent Egyptian daily Al-Shurouq, also criticized the government's handling of the economic crisis, but did not hold it solely responsible for the crisis itself. According to him, the citizenry does not care about the causes of the crisis; the important point is for the country's leadership to act to bring relief to common people. He wrote:

"I hope that the president, the government, and other relevant mechanisms act before society explodes due to the economic crisis, which would be disastrous and very dangerous. First, the government should realize that there is a difficult problem, because if it does not, it will be a disaster.

"Second, the government should take clear steps on the ground to confront the rising tide of public anger... now, before it becomes a raging torrent.

"The worst response [possible] is for the government to say it has done everything it can and that it is focusing on the [economic] infrastructure, and that people are ungrateful and do not appreciate its efforts. This will repeat the fatal mistakes made by both [Hosni] Mubarak and [Muhammad] Mursi in their final days. In this matter, the principle [to follow] is that 'the customer is always right.' The government must do one of two things: either convince its citizens that all its policies benefit them, or abandon [those policies].

"Like many others, I realize that the current government is not exclusively responsible for this corrosive economic crisis, and in fact only bears a small amount of the blame, and the same goes for all of Al-Sisi's governments and the Muslim Brotherhood government as well, as this crisis is the result of a decades-long buildup [of problems], during which Mubarak bought the people's silence with practical economic support, [and they] in return [forgave him for] not implementing reforms many years ago.

"But ultimately, the common citizen does not care who caused the crisis - Mubarak, Mursi, or the Supreme Council of the Armed Forces! For the citizen, there is a president and a government who accepted the mantle of responsibility and must [therefore] wear it and ease his burden...

"I also understand that in order to realize reforms, there is no escaping hard decisions that will lead to a rise in prices of basic commodities as a result of the expected increase in the value of the dollar against the Egyptian pound, and the cut in energy subsidies. But the question is, what is the point of implementing any economic plan if it leads to starvation riots? The government should sensitively balance enacting economic reforms and not destroying the lives of the poor and the lower middle class.

"It would be absurd to blame the MB of being behind it all - first, because they are weaker than we think; second, because in repeating this allegation, the government shows that [the MB] is still strong and endangers [it]; and third, and most importantly, because complaints of rising prices are almost universal, although the MB undoubtedly will try to ride any wave of future social protest...

"It makes no sense to demand that the common citizen take austerity measures and bear the burden of high prices so long as the people who hoard sugar, rice, and other products, as well as dollars, in order to make astronomic [profits] have not been executed. There is no escaping sending a special message to the people, that the government is actively working in their favor...

"Regular citizens don't care about big words regarding budgetary deficits... They care about going to the store or supermarket and finding a kilo of sugar at a reasonable price, not ten pounds, and the same is true for rice, oil, bread, and the other staple foods. The merchant or the investor wants a real and immediate solution to the tragedy of the dollar, because the only ones who benefited from the events of the past months are the corrupt, the thieves, and the price gougers..."[25]

Egyptian Columnist: Government, Parliament Must Implement Al-Sisi's "Refrigerator" Policy And Tighten Their Belts

Amin Salah, a columnist for the Egyptian daily Al-Yawm Al-Sabi', which takes a pro-regime line, complained of the massive waste in the government, parliament, and among Egyptian governors, and argued that this budget could be better used to benefit the public. He demanded that authorities adopt Al-Sisi's "refrigerator policy" (i.e., austerity measures), named after a story Al-Sisi told about his impoverished childhood.

Salah wrote: "'For 10 years my refrigerator had nothing in it but water.' This is what President 'Abd Al-Fattah Al-Sisi said... at the youth conference in Sharm Al-Sheikh. Some believe that this was a message to Egypt's poor so they will remain patient with the state at this difficult time. In truth, this message is directed at all citizens - both the government and the people - and more than calling for austerity, it calls on everyone to reexamine their expenses.

"For starters, let us discuss the government's 'refrigerator': Many Egyptian ministers have fancy cars and massive offices, and when they travel to foreign conferences, they stay in exorbitantly-priced hotels... If the ministers viewed the president's message from inside his refrigerator, the expenses of Egyptian [government] ministries would have completely changed, and the country could have saved large sums.

"[As for] parliament's 'refrigerator': The millions that parliament pays to the Al-Tahrir parking garage so that MPs can park their cars before each session, and the various conferences that parliament holds to celebrate various events at a cost of millions - all this should come under the 'refrigerator' policy, and instead of all this waste, we must save this budget as part of measures to protect public funds due to the economic situation currently afflicting Egypt.

"Many do not know that some governors spend their entire terms staying in palaces and villas owned by their governorates... All these phenomena should also be brought under the president's 'refrigerator' [policy].

"Many products imported by stores and trade centers are luxuries that serve only certain [richer] levels of society, but cause big problems for the Egyptian economy, since they increase imports that Egypt pays for with hard currency. All these products should [also] be brought under the president's 'refrigerator' [policy].

"The garbage piling up on the streets of the republic should also be brought under the president's 'refrigerator' policy, as some countries see it as a national resource [and benefit from it] by recycling. Moreover, some countries sign annual agreements to import garbage from other countries in order to recycle it and benefit from it.

" Egypt's rich pay no taxes in their palaces and villas, although the buildings themselves cost millions. Is it not the state's right to receive a few Egyptian pounds every month as a tax on such buildings? They too should be brought under the 'refrigerator' policy.

"When President 'Abd Al-Fattah Al-Sisi spoke of his personal refrigerator, he did not mean that the poor alone should bear the burden, but rather that all Egyptians together should bear the cost of the economic reform. Therefore, the government should have a refrigerator like the president's, as should parliament, the governors, and all state institutions..."[26]

 
"The floating of the Egyptian pound": "Al-Sisi's water refrigerator" saves the drowning Egyptian currency (Al-Arabi Al-Jadid, London, November 7, 2016)

Egyptian Establishment: The Government Is Facing Nasty Rumors And MB Incitement

In response to the harsh criticism from both political and senior media figures in Egypt regarding the government's handling of the economic crisis, the government daily Al-Ahram published a number of articles that, like President Al-Sisi, attacked the media for criticizing the government and justified the latter's policies.[27]

Al-Ahram Editor: The Egyptian Media Does Not Understand The Root Causes Of The Economic Crisis

 Al-Ahram chief editor Muhammad 'Abd Al-Hadi 'Allam wrote in his weekly column that the economic crisis stemmed from decades of neglect by the previous Egyptian administrations, and that the Al-Sisi regime was offering profound and well-thought out solutions for it:

"The [economic] reforms in Egypt are approaching the stage of formulating the full picture for improving the economic and financial situation in the country, after months of shaping and elaborating their details and offering alternatives for addressing our shaky situation. For years, the political leadership has been speaking frankly to the people regarding [our] real economic situation... This has displeased certain [people], who decided to accuse [the government] of failure, inability to resolve [the issues] and a lack of [economic] vision. But, in actual fact, these people failed to understand that Egypt was not in an optimal situation when its people took [to the streets] crying 'life, liberty and social justice' on January 25, [2011], over five years ago.

"[Economic] crises in Egypt are nothing new, and what [some] media figures are saying - that before January 24, 2011 things were much better than they are today - makes no sense, because the causes and roots of the crisis are anchored in long decades of neglect. In the last five years, this has taken on additional aspects, which stem from several factors, including the rising violence and terror and their effect on the security situation. [All] the abovementioned factors affected Egypt's image in the world, [causing] a drop in tourism and in the revenues from the Suez Canal. The state budget was stretched after salaries and wages were increased due to sectorial pressures, whereas Egyptian export declined and the import of basic commodities increased and their prices rose. Egyptian manufacture ground to a halt and state income decreased due to a string of consecutive crises and in the absence of a clear plan for the period after the ouster of former president Hosni Mubarak. Furthermore, the catastrophic rise to power of the Muslim Brotherhood... brought the country to a worrying [economic] condition in several domains...

"The political leadership believes in the need to propose in-depth solutions leading to a comprehensive reform. That is the purpose of the president's current actions, [so] there is a light at the end of the tunnel. The government has made huge investments in infrastructure and road networks, and resolved the electricity crisis with unprecedented speed... People now forget how domestic security was restored following the wave of violence in 2013-2014, whose planners wanted to drown Egypt in sectarian conflict and internal fighting among the sectors of society...

"The political leadership is now working to mend... the accumulated problems of previous eras. We can no longer leave the country at the mercy of the changing variables of the political situation around us in the Arab region and the Middle East. Even if we resolved the issue of restoring tourism and increasing the revenue from the Suez Canal, or relied on [funds] transferred by Egyptians abroad as our primary source of national income and hard currency,[28] it would not have helped given the current crisis, the rapidly growing population and the large number of young people waiting for job opportunities in [this] country. The best [way] to fix the problems that nobody speaks of is to renew production by boosting agriculture and the manufacturing industries, whether [by means of] direct foreign investment or by encouraging investment in small and medium enterprises..."[29]              

Al-Ahram Editorial: The Public Is Showing Considerable Maturity In Face Of Painful Decisions; Most Egyptians Refuse To Heed Calls For Protests

Three days later, on November 7, following the central bank's decision to float the Egyptian pound and the decision to cut subsidies to fossil fuels , Al-Ahram published an editorial defending these measures. It said: "Egypt has successfully navigated the phase of floating the pound and cutting fuel subsidies. Despite some grumbling, which is usual in such situations, it [all] went smoothly. Those who follow [these matters] noted that the issue of floating the pound was debated for a long time, and the ground and public opinion were prepared for this type of decision, so when it was  announced, it was not a complete surprise.

It seems to me that, alongside the economic challenges and the security threats, the Egyptian government has now begun tackling another issue having to do with nasty rumors, the last of which concerned [a plan] to fire millions of civil service employees. Egyptian cabinet spokesman Husam Al-Qawish  hurried to deny these repeated false reports about the dismissal of millions of civil servants as part of the conditions [set out by] the International Monetary Fund [for granting Egypt a loan]. Al-Qawish demanded that all media outlets strive to keep their reports accurate.

"Though Egyptians have demonstrated considerable public maturity in dealing with the painful economic decisions, the terrorist MB organizations will not stop their ongoing incitement aimed at blowing up the situation in Egypt and agitating the public. However, most Egyptians refuse to heed the calls for chaos and destruction, and understand that expressing [their views] calmly on the media and social networks is sufficient at the present stage, [because right now] Egypt cannot withstand further upheavals..."[30]        

 

* C. Meital is a research fellow at MEMRI.

 

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