Egypt: Gaza war weakens President Sisi
$1.3billion US military aid a year helps sustain Egypt’s armed forces. Lack of democracy has never concerned the US ruling class, for whom the Egyptian government is a key stabilising factor in the region. Sisi needs senior military officers’ backing and they want to continue receiving this huge subsidy.
Weak economy hits workers and poor
The discovery of natural gas in the Eastern Mediterranean increased co-operation between Egyptian and Israeli governments. Israel exports gas to Egypt where Liquefied Natural Gas (LNG) is produced, earning dollars the debt-ridden economy desperately needs.
This year’s intense summer heat wave raised domestic demand for gas (used to generate electricity for cooling) leaving none for export. Even so, there were frequent power cuts.
The first LNG cargo for three months departed on 5th October. Three more ships were due to sail this month, but two days later Chevron shut down the Tamar gas platform, under 50km from Gaza, on Israeli government instruction. This is costing the Egyptian economy hundreds of millions of dollars, with companies already struggling to pay for imports due to a dollar shortage.
Life has got much harder for almost all Egyptians this year. The Egyptian pound has lost half its value after three devaluations since early 2022. Food prices were up 72% annually in August, with overall inflation a record 39.7%. Interest rates have more than doubled since early 2022 to 19.75%, but inflation means real rates are negative, so the government cannot borrow enough to pay its debts.
Two thirds of the population rely on subsidised bread, costing $2.9billion last year, 2.6% of government spending. Egypt only grows half its grain, with yields falling due to climate change and water shortage. The Russia-Ukraine war had already increased global prices.
Sisi is under pressure from the International Monetary Fund to reduce public spending, including subsidies on basic foods. 56% of public spending is on loan repayments and interest charges, so the banks get their money while education, health and other basic services are squeezed.
Despite poor and working class families missing meals, Sisi arrogantly told them, “Don’t you Egyptians dare say you would rather eat than build and progress. If the price of the nation’s progress and prosperity is hunger and thirst, then let us not eat or drink.” He also told young people they could earn “a respectable income” by donating blood every week.
The IMF is withholding the next instalment of the $3billion bail-out agreed last December, demanding the currency floats, meaning a further devaluation adding to the cost of imports. They also want faster privatisation. $1.9billion of companies were privatised in the first six months of this year, with another $5billion due to be sold off by June 2024. But armed forces-owned companies have not been sold. Egyptian and foreign capitalists want to stop their tax and business advantages, but they provide high incomes to many retired senior officers.
The presidential election, due in early 2024, has been brought forward to December 10-12. Sisi hoped this will prevent credible alternative candidates emerging before another devaluation and further public spending cuts. He got the constitution changed so he could theoretically remain president until 2030.
Sisi announced his candidature on October 2nd. Large support rallies were held in many cities, reported to include government workers instructed to attend, as well as others attracted by free entertainment. But in Marsa Matrouh, a Mediterranean city of 230,000, the rally turned into a rare protest as hundreds tore down pro-Sisi banners and placards, “The people want the fall of the regime” was chanted, as during the 2011 uprising which brought down President Hosni Mubarak.
When Sisi last stood for election in 2018 he won 97% of the sham vote by ensuring there was only one other candidate – who supported him anyway! But this year Ahmed Al-Tantawy from al-Karama (Dignity), a party from a left-wing Nasserist tradition, has quickly gained support. One supporter in Alexandria said, “We are dreaming on a grand scale, hoping for transformative change and the cessation of oppression that has systematically impoverished the Egyptian people for the benefit of a select few.”
With two million followers on Facebook Tantawy should have been well placed to get the 25,000 signatures needed to become a candidate. But, with widespread reports of intimidation, arrests and obstruction of those trying to sign the official documents, he failed to make the candidates’ list.
Sisi must have thought his road to re-election was clear but now the war on Gaza has thrown everything into great instability. His past friendly meetings with Netanyahu and US presidents and antagonism to Hamas is going to increase pressure on him in coming days and weeks. There is massive public sympathy for Palestinians.
During the second Intifada there were strikes and large protests by Egyptian workers and students in 2000 and 2002 in solidarity with the Palestinians that quickly became anti-Mubarak. Troops were used to crush the protests but the movement towards the 2011 uprising had begun. A new upsurge of mass protests and demonstrations, initiated by the Israeli state attacks on Gaza, cannot be ruled out, despite the Egyptian state repression.
Sisi will win the election in December, but the likelihood of him surviving as president to 2030 looks slim. He will be one of many leaders in the region to fall as a result of unending economic crisis and renewed horror of war.
Only Egypt’s working class can clear a way forward by building its own independent organisations and arming them with a socialist programme to use its wealth and resources for the benefit of all. Nationalisation under democratic workers’ control of all big companies, planning their resources to meet the needs of all and full democratic rights would inspire a movement for a socialist federation of the Middle East and North Africa.