Political Files
30 June 2013 Revolution
Thursday، 02 July 2015 - 12:00 AM
The Triggers
Muslim Brotherhood's now-incarcerated and then President Mohammad Morsi ruled Egypt for only one year and 3 days, after which the people rose against him. Drastic mistakes had been made that brought an end to the lull in the relationship between the Brotherhood and the people during that time.
Foreign policy
- The visits made by then President Mohammad Morsi failed to open new vistas of cooperation with either Eastern or Western countries.
- Egypt's foreign policy was reduced to relations with Brotherhood supporting countries, namely Qatar and Turkey; and relations with key countries in the Arab world also suffered immensely.
- No advanced technology was brought to benefit the production sector or assist Egypt in correcting its economic bearings. On the contrary, the agreements signed by businessmen accompanying President Morsi during his visits abroad constituted a burden on the country's foreign currency reserves
- President Morsi's handling of Ethiopia's Grand Renaissance Dam crisis lacked in both professionalism and statesmanship. This is most evident in the dialogue broadcast live with Egypt's political powers, which caused tension in the relations and undermined negotiations with Ethiopia. President also Morsi continued to foot drag as regards cooperating with Nile-basin countries.
Polarization
- Under President Morsi's rule, the Egyptian society was plagued by extreme polarization. On the one hand, there were the “Islamists” as represented by President Morsi and his Brotherhood; and on the other, there were those branded as “secularists”. Instead of standing as one man, the Egyptians were now divided between those in favor of one side or the other and those against.
- Under President Morsi, the process of “Brotherhoodizing” the state was being carried at a very quick pace, despite public outcry.
- President Morsi would very often would advocate something and do the very opposite. An example is his constant advocacy of protecting Copts, and then targeting their Churches.
- Unprecedented disorderly and unlawful acts were instigated by both President Morsi and his league
Defense and security
- Crises were created to throw security agencies off balances; e.g. the Mohammad Mahmud events, the Port Said Stadium massacre and others.
- Decisions were taken and constitutional declarations proclaimed, which caused people to take the streets in public outcry and increased pressure on security agencies.
- Extreme Jihadists were released from prison and sent to Sinai where they attempted to establish an Islamic state, supported by President Morsi himself and aided abetted by Hamas in Neighboring Gaza. The groups killed 16 soldiers and kidnapped 7, whose release was brokered by the Muslim Brotherhood. Recent evidence indicate these terrorists supported the Brotherhood in its was against the state.
- Members of the Brotherhood sought to verbally defame leaders of the military institutions by circulating concerning its unity.
Food security and services
- Food crises and price hikes continued without any government intervention, despite attempts to improve bread and butane gas bottle distribution systems.
- Diesel and motor engine oils were so much in shortage that they affected caused continued interruption of electricity.
- The food supply system was manipulated to serve election purposes
Culture, literature and the art
There emerged a trend which to alter the cultural identity of Egypt, backpedaling toward the past, beginning by prohibiting Ballet from being shown in the Opera House to putting loyal Brotherhood leaderships in place of those who are competent.
The media and the press
The media was quick to unravel the truth about President Morsi and his clique, which was why the Brotherhood became aggressive and sought to eliminate media icons and further attempt to quickly to brotherhoodize press and media institutions.
The Judiciary and public liberties
- The President and his clique instigated several crises with the Judiciary ranging from the removal of the prosecutor-general to the siege laid by Brotherhood supporters to the Supreme Constitutional Court and the attempt to undermine its role in the Constitution of December 2012. Constitutional declarations were also proclaimed which reflected negatively on the Judiciary and on public liberties thus instigating public outcry translating into setting fire to the headquarters of the Freedom and Justice Party.
- When the Administrative ruled against holding parliamentary elections, the Brotherhood called for purging the Judiciary and sought to wriggle out a law, reducing judges' retirement, which would have removed thousands from their posts and replaced by others who were loyal to the Brotherhood.
- The Judiciary's final stroke was when a justice named the President and a number of brotherhood leaders as being party to colluding with Hamas and Hizbullah in the incident of breaking into the Wadi al-Natrun Prison.
Transport
- President Morsi failed to deliver on his commitment to solving the transportation problem within the first 100 days of his rule. What is even more is that the problem worsened, and with every passing day more accidents took place; the most prominent being when 50 school students were killed in a bus-train accident in Assuit.
- No new roads or road repairs took place during that year plus the Railroad Facility's performance was on the decline.
Economy and finance
- Egypt under Brotherhood rule sought to borrow from countries like Qatar or Turkey and gave great importance to the IMF loan, which they considered as vouching for Egyptian economy's good performance. Meanwhile, with the decline in GDP, as a result of political and security issues, budget deficit and local debts increased; hard currency reserves were declining and foreign debts rose by 30%.
- The number of faltering factories increased as did unemployment; the number of Egypt-bound tourists declined and the exchanged, handled badly, increased the pressure on people's life.
- The depreciation of the pound reflected negatively on dealings in the Stock Exchange. Foreign investors were fleeing and Egypt's credit rating was downgraded numerously.
The achievements (domestically)
The Suez Canal Project
Construction of a new Canal from km 60 to km 95, in addition to deepening and widening of the Great Bitter Lakes by-passes and Ballah by-pass, with a total length of 37 km, (Total length of the project is 72 km)
Creating a new canal, parallel to the existing one, to maximize benefit from the present Canal and its by-passes, and double the longest possible parts of the waterway to facilitate traffic in the two directions and minimize the waiting time for transiting ships. This will certainly reduce the time needed for the trip from one end of the Canal to the other, and will increase the numerical capacity of the waterway, in anticipation of the expected growth in world trade. The project goes side by side with the Suez Canal Area Development Project. The two projects will add to the importance of the Suez Canal, and will make it the route of choice for ship owners the world over, putting any alternative routes out of competition. The project will also have quite a positive impact on the Egyptian national income as it will boost the hard currency earnings, provide much needed job opportunities and create new urban communities.
The Golden Triangle
The 'Golden Triangle' project seeks to link the Red Sea port cities of Safaga and al-Qusayr along with the Upper Egyptian Governorate of Qena.
Global Logistics Centre for Grain Handling
The logistics center will be located on 3,350 square kilometers of land in Damietta in the Delta area. It is expected to handle 65 million tonnes of grain and basic food commodities trade per year.
The project includes building storage silos and two new quays that will be able to receive large shipments at Damietta Port.
Northwest Coast Development
The Northwest Coast Development Project is among the vast developmental and multidimensional projects currently run by the government. The project will serve both tourism and agricultural purposes in the northwest coast hinterlands, increasing population density in the Delta through big environmental projects for industrial communities. It is expected to absorb Delta population increases over the next 40 years, which is estimated to reach around 34 million. The projects will also provide roughly 11 million job opportunities until completion in 2052.
The 100 million olive trees project
The project is two-dimensional. Olive trees will be planted in both Al Moughrah Valley, West Desert and Al Tour, South Sinai Peninsula. Research centers will provide millions of olive sprouts and expertise to plant them. This project covers about 70 thousand acres.
Livestock
A forward-looking plan was initiated to improve Egypt's livestock sector and create new areas of reclaimable land which will be allotted to young graduates. Old land reclamation villages are also set to be developed and a new irrigation scheme will be put in place to reduce water waste in the next two years.
Housing
To deal with urban development issues, an integrated dynamic urban plan that incorporates historical and modern architecture and that maximizes the utility and balance between energy, water and land is developed. The new urban development plan is capable of doubling the urban space, geographically redistributing development and citizens to maximize the use of available resources; as well as replacing and developing slum areas, and improving the quality of life.
In this context, the government seeks to:
- Increase the urbanized area by about 5 percent of its total area
- Establish 7.5 million housing units
- Solve the problems of slum areas
70 thousand average-income residential units were built at a total cost of EGP9.5 billion and were handed over in 2014/15. Another 174 units are under construction at the cost of EGP25 billion and are expected to be handed over by end 2015.
50 thousand units financed by the UAE grant will be completed in July 2015, which brings the total of units built under the umbrella of this project to 120 thousand. Another 23 thousand units will be completed by the end of 2015, bringing the total of units built to 243 thousand at the cost EGP26 billion.
The Egyptian Armed Forces Engineering Authority was commissioned to build 150 thousand units for average income groups at the cost of EGP9 billion; of these 30 thousand will be handed over by June 2016. High income groups were not excluded. 2000 units were built to serve them.
The efficiency of 30 districts in 20 new cities has also been raised.
Roads, means of transport and other services have been provided to the “Build Your Home” Project at the cost of EGP3 billion.
Contracts were signed in the 2014 Sharm al-Sheikh Economic Conference for two projects in the 6 October City and the New Cairo with Mountain View and Saudi Sisban Holdings. Egypt's Share in the projects is expected to 30-40 percent, depending on the value of the project, and the implementation period is up to 10 years.
New National Roads Network Project
The new National Roads Network Project is a major Egyptian infrastructure scheme initiated by President Abdel-Fattah al-Sisi in August 2014. The project includes the construction of 39 new roadways with a total length of 3200 km. The new roads network will account for around 10% of the total length of all roads in Egypt. The project is expected to be completed within 2 years and cost EGP36 billion.
Developing Hurghada International Airport
On 17 December, 2014, President Abdel-Fattah al-Sisi opened on the new Hurghada International Airport, with investments reaching EGP2.4 billion ($336.5 million). The new airport would increase the capacity to 13 million passengers annually instead of 5.5 million passengers currently.
Demarcating future governorate borders
The government is working on demarcating the future governorate borders with the purpose of absorbing the population increase and allowing space for hinterland.
Economic Reforms
Real GDP growth rate reached 5.6 percent in the first six months of FY 2014/15, mainly due to the recovery of business confidence as a response to the political, economic and social reforms recently undertaken by the government. The forecasted growth rate is around 4 percent for FY 2014/2015. Tourism, manufacturing, construction and Suez Canal were the main driving sectors during the first six months of 2014/2015. Final consumption is the main source of economic growth (85 percent) in the first half of the fiscal year 2014/2015. In addition, investment is contributing positively to growth, for the first time in the last few years, due to gradual improvements in the business environment and to the bold reform measures adopted by the government. Investments in the first half of FY 2014/2015 amounted to EGP147.6 billion, with a growth rate of 20.2 percent compared to the corresponding half of FY 2013/2014.
It should be noted that the fourth quarter of FY 2013/2014 realized a growth rate of 3.7 percent, reflecting the positive impact of the two stimulus packages, through which EGP60 billion were injected in productive projects covering almost all Egyptian governorates. In addition, real GDP growth rate reached 6.8 percent in the period (July-September) 2014. The upward growth trend that took place lately echoes the revived business confidence, which is expected to accelerate with the accomplishment of the political road map, the continuing macroeconomic reforms and the restructuring of the investment climate. The improved stability will lead to a recovery in domestic demand. In addition, further support from Egypt's partners is more likely to continue, and to contribute to infrastructure development. Retrieving the average growth rate of 7 percent that occurred prior to the global financial and economic crises requires several restructuring measures, among which dealing with an energy shortage, attracting more tourists, and re-opening the non-performing factories. Annual growth rates are forecasted to reach 6 percent on average for the coming 4 years that end in FY 2018/2019.
Raising Egypt's Credit Rating
The International Institution of finance has raised Egypt's Credit Rating four times.
In December 2014, International Credit Ratings Fitch announced upgrading the Arab Republic of Egypt's credit rating by one notch concerning the long – term borrowing for both foreign and local currencies to B and so while keeping the Egyptian economy's outlook “stable”.
In April 2015, Moody's Investors Service upgraded to B3 from Caa1 the local-currency (LC) deposit ratings of National Bank of Egypt SAE, Banque Misr SAE, Banque Du Caire SAE and Commercial International Bank (Egypt) SAE as well as the LC deposit ratings of Bank of Alexandria SAE to B2 from B3. The standalone ratings of all five banks were also upgraded by one notch.
In May 2015, International rating agency Standard and Poor's have affirmed Egypt's long and short-term foreign and local currency sovereign credit ratings at ‘B-/B', the agency announced May in an official statement, putting the country's outlook at “positive” instead of “stable”.
IMF report (February 2015)
Growth forecasts for Egypt's real gross domestic product (GDP) were raised to 4% in 2015 and 4.4% in 2016, the International Monetary Fund (IMF) said in its World Economic Outlook report.
The report said that Egypt's macroeconomic stabilization plans and wide-ranging structural reforms are expected to increase confidence, and growth is expected to rise to 4% this year.
The IMF noted, however, that to attain the macroeconomic stability and create job opportunities, continued fiscal consolidation, steady implementation of reforms, and external financing are essential.
Economic indicators
Growth rates increased from 1.25% in 2014 to 5.6% in the first half of 2015. The government is aiming for 6% to 7% in the next five years with a projected per capita income increase of up to $5000 a year. The government also seeks to reduce budget deficit to 8.5% of GDP and foreign indebtedness to 85% as compared to 95% at present.
Energy
Phase I of the 3650-megawatt master plan for power generation had been put into action, whereby 1700 megawatts was fed into Egypt's unified network on 31 May, 2015. An additional 3500 megawatts will be provided after the 5-year plan investment projects are completed.
Social justice
The government realized the importance of adopting a comprehensive strategy to reduce poverty, and to pave the way for social justice. The main measures undertaken include the following:
Reducing the deficit in the state budget for FY2014/15 by increasing the revenue through re-structuring the tax system to make a fair distribution of the tax burden and fight against tax evasion; and reducing the expenditure through re-prioritizing public spending to provide protection to the most vulnerable.
Reducing the energy subsidy within 3 to 5 years, while protecting the poor, low-income and middle class. The program aims at rationalizing energy and oil subsidies during 2014/2015 as part of a gradual plan in the medium term to reduce these subsidies. This plan consists of three pillars:
- Aligning the relative prices of petroleum products with their most efficient channel for energy generation.
- Raising the efficiency of energy usage, and providing subsidy to some sectors in order to help them to move from the use of traditional energy sources to use the clean energy.
- Using Smart card system for better targeting of subsidies.
Increasing the social security pension by EGP1 billion to reach EGP3.3 billion for 2014/15 and the contribution in pension funds with EGP2.3 billion in the same year.
Launching a cash-transfer program and increase the number of beneficiaries from 1.5 million to 3 million poor families.
Establishing logistical hubs for grain trade and storage to contribute to food security, and launching commodity exchange initiatives in collaboration with international agencies.
Launching a social protection-targeting program based on transforming all paper ration cards to smart cards.
Adopting a new system of supply, that widens the choices of ration cardholders from the main commodities (Oil – Sugar – Rice) to more than 30 commodities.
Implementing a new bread system including the allocation of 150 pieces of bread for each citizen per month, at the price of 5 piaster/each piece of bread. The beneficiaries from this system are those who are eligible for social security pension, and Sadat and Mubarak pensions; widows, divorced women and breadwinners; and those with chronic diseases and special needs. Other groups benefit from this system including minors who have no breadwinner or fixed income after their parents› death; temporary seasonal employees, workers in agriculture, street vendors, drivers and those who have academic qualifications but are without work and with a monthly income up to EGP800 per month; government, public business sector and the private sector employees with salaries up to EGP 1200 per month; government, public business sector and the private sector employees with insurance up to EGP1500 per month.
Amending the Social Insurance Law to increase the early retirement pension starting July 2013. The law also provides self-employed social insurance to farmers with more than one feddan acquisitions.
Extending the medical insurance to farmers and agricultural workers who do not have access to the public health-insurance program.
Adopting some programs to protect the he poor, support the marginalized societal factions and provide protection to the most vulnerable. Takafol and Karama are two programs that have been recently implemented as part of a conditional cash transfer program to help poor families in order to provide the health and educational services to children.
Achievements (International & regional)
The visits of President Abdel-Fattah al-Sisi reflect a new approach to Egypt's foreign policy; a balanced approach, which seeks to promote international cooperation, while protecting the country's supreme national interests.
1. The government has adopted several decisions, based on equality and on protecting the mutual interests of both Egypt and the world's big powers.
2. Egypt has avoided clashing with countries, whether at the international or the regional levels, which misconstrued the wishes of the Egyptian people when they rose against the then Brotherhood regime. Instead it has since been sending messages and signals, which has resulted in a better understanding by world leaders of the facts of the situation in Egypt.
3. No compromises were made concerning the world's stance on Egypt's internal affairs.
4. Egypt has regained its central role within the Arab world. Evidence of this is the decisive part it played in putting an end to the Israeli aggression against Gaza in the summer of 2014; it having hosted the Gaza Reconstruction Conference. Egypt has very early on sounded the alarm against escalations between Iraq and Syria and warned of extremely violent groups emerging that would change the equation of the struggle. Egypt cautioned that these extremists would also reach Libya and Yemen. Egyptian's military assistance to both these countries signal that Arabs are very much alert and willing to use their huge resources to defend themselves
5. Egypt's national security is based on Arab and African security. Egypt has thus hosted meetings of the parties to the Syria and Libya conflicts as a means to protecting the unity and territorial integrity of the two countries and has been in contact with the Ethiopia and Sudan over the issue of the Renaissance Dam.
6. Egypt believes that sectarianism/factionalism is the means to destroying the peoples of the region.
7. One of Egypt's pre- and post-revolution foreign policy foundations is calling for the elimination of all weapons of mass destruction and subjecting Israeli and Iranian nuclear facilities to IAEA inspection.
8. Egypt calls upon the international community to adopt a comprehensive counter-terrorism strategy, which not only seeks to eliminate terrorist groups but also to fight poverty and improve the social and economic conditions of countries suffering from terrorist attack.
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