State of Emergency in Egypt

  • Aug 21, 2017
  • Published in Videos

Egypt's cabinet has approved a countrywide state of emergency for three months, a day after two church bombings left at least 44 people dead. It needs to be approved by parliament within seven days in order to remain in place.

By Afro-Middle East Centre

The threat of the collapse of Gaza Strip as the siege on the territory and the consequent humanitarian crisis worsens resulted in the Hamas leadership seeking help from neighbouring Egypt. This especially after Israel drastically reduced electricity supply to Gaza because of Palestinian Authority (PA) president, Mahmoud Abbas, deciding to cut electricity payments for Gaza. Delegations from Hamas’s political leadership met on numerous times with representatives of the Abdel Fattah El-Sisi government in recent months.

Marking ten years of its control in the tiny besieged territory, Hamas seeks to end the blockade (imposed by Israel in 2007 and followed by Egypt) by Egypt, and to ease the deteriorating life conditions faced by the two million Palestinians in Gaza. Pushed to desperation by the alarming humanitarian situation, Hamas has even agreed to Egyptian requests that the Palestinian resistance movement meets with Mohammed Dahlan, the strongman that once ruled the PA security apparatus in Gaza with an iron fist.

The renewed relations with Egypt have also allowed Hamas to engage with the Israeli government on a prisoner-exchange deal through Egypt, negotiate with Egypt over the supply of fuel for Gaza’s electricity generating plant, and receive a commitment for the opening of the Rafah border crossing in September to allow for free crossing of Palestinians between the strip and Egypt.

During the one-year presidency of the Muslim Brotherhood’s (MB) Mohamed Morsi, Egypt’s first democratically-elected president, Hamas enjoyed good relations with Egypt, which eased the blockade and allowed for trade and movement of Palestinians through Rafah. With the overthrow of Morsi in a military coup, the Egyptian government cracked down on MB members and supporters, and put pressure on Hamas. The Palestinian group’s historical links with the MB, and the warm relationship between the Egyptian government and Israel had made Hamas’s relationship with the Sisi government hostile, and led to the closure of Rafah. Relations were further complicated by fighting in Sinai as claims were made of Gaza residents joining the fighting alongside Islamic State group (IS) fighters behind the Sinai insurgency. The impact of this was felt in Gaza by ordinary Palestinians who now face even worse living conditions due to electricity shortages. The Ramallah-based PA has been on a campaign to tighten the noose around Gaza after reducing the salaries of thousands of civil servants in Gaza, and retiring 6 000 of them.

Rafah is critical for Gazans since Israel has blocked access for them, and many have resorted to using underground tunnels to smuggle goods in and out of the enclave. Previous relations between Hamas and Egypt have been strained because of good relations between Egypt and Israel, which also resulted in an Egyptian blockade on Gaza. The Egyptian military has waged a war against Gaza’s tunnel economy since the blockade began. Egypt has razed thousands of homes in the Sinai and flooded tunnels to quell the smuggling of goods. Egypt contends that the tunnels allowed for the arming of IS insurgents in Sinai.

Hamas has been promised that an arrangement with Dahlan could see Gaza receiving the basic supplies it needs to survive. Such an arrangement will, however, also bolster Dahlan’s campaign take control of Fatah, the PA and the PLO. Dahlan has denied he has any designs on leadership in Gaza, but his supporters have already started making their way back as part of the Egypt agreements.

Discussions between Hamas and Egypt have also covered a possible prisoner exchange between the Palestinian movement and Israel. Hamas head Ismail Haniyeh said the group was in talks with the Israeli government through a ‘third party’ to release Hamas prisoners in Israeli jails. The ‘third party’, Egypt, has communicated to Israel that Hamas wants the release of fifty-four detainees who were part of the 2011 swop for the Israeli Defense Forces (IDF) soldier Gilad Shalit who was held by Hamas. The Palestinian prisoners were rearrested in 2014, and Israel has refused to release them unconditionally.

The Hamas visits to Cairo in February, June and July saw talks with Egyptian officials, including members of the intelligence sector. The Hamas officials also met with Dahlan, who is a trusted friend of the Egyptian government and an advisor to the crown prince of the United Arab Emirates, Mohammed bin Zayed. Dahlan has been working to find a way back into the Fatah leadership after being expelled from the group in 2011. He was responsible for planning a coup against Hamas in Gaza after the Islamist movement won legislature elections in 2006. After the Hamas delegation, headed by Gaza leader Yahya Sinwar, returned from the Cairo meeting in June, Egypt delivered fuel to resuscitate a power plant in Gaza. In return, Hamas began constructing a security buffer zone along the southern border with Egypt in response to Egyptian demands for increased security in the area.

Dahlan’s involvement comes with the promise of funds from the UAE, which will help him to re-launch his leadership bid. It is a plan masterminded by the UAE, implemented by Egypt and backed by Arab leaders (and Israel). For Hamas, turning to Dahlan is a means to an end; finding common cause with an enemy of an enemy has led to Egypt agreeing to open the Rafah crossing, if the security situation in Sinai is improved, and the UAE has pledged $100 million for the construction of a power plant on the Egyptian side of the border with Gaza.

Certain Arab leaders hope to neutralise Hamas, while Israel prefers to eliminate it completely. Gaza’s dire humanitarian plight, which threatens Hamas’s rule in the strip, is an ideal opportunity to marginalise Hamas and bring into leadership a man who has proved to be a reliable proxy for the USA, Israel and the UAE. Fatah leader Mahmoud Abbas is in a precarious position, and his delaying in forging a reconciliation with Hamas could result in him losing power to his rival, his long-time rival.

By Afro-Middle East Centre

Protests by Egypt’s main journalist syndicate and Egyptians previously loyal to the military regime point to increasing opposition to President Abdel-Fattah el-Sisi and his regime, and to their inability or unwillingness to scale down their repression of citizens.

The most recent protests were sparked by the police’s storming of the journalist syndicate’s Cairo headquarters and the arrest of journalists Amr Badr and Mahmoud el-Sakka. They were accused of inciting protests against Sisi’s April 2016 decision to hand over the islands of Sanafir and Tiran to Saudi Arabia. The decision was widely criticised by Egypt’s elite and media. Ironically, one of the ‘reasons’ cited for the military coup against former president Mohamed Morsi was the (false) claim that he intended transferring control of North Sinai to the Palestinian resistance group Hamas. Badr and el-Sakka had opposed the unpopular island transfer, which saw thousands protesting and 1 200 arrested. Over 150 protesters were subsequently sentenced to between two- and five-year prison terms for the protests, which violated the November 2013 protest law adopted to quell dissent after Morsi’s ouster. Even former Sisi supporters, including Popular Current Party’s Hamdeen Sabahi, challenged the island decision in court, and it is likely that opposition will increase further if parliament ratifies the handover.

The May protests follow a pattern of increasing dissatisfaction with Sisi’s policies, which have failed to stimulate an economy that contracted in 2015. Inflation currently stands at eleven per cent, and the much- touted eight billion dollar Suez Canal expansion project only marginally increased government revenue, owing to the global economic slowdown and drop in oil prices. Shortages of cooking gas and electricity continue, and the drop in foreign reserves has caused the government to tighten exchange controls, especially since Gulf aid has diminished following the accession to power of King Salman in Saudi Arabia. Further, the military has aggressively increased its already numerous activities in Egypt’s economy, thus competing with private business. Egypt’s elite has been impacted, and Sisi has come under increasing criticism from private media outlets and commentators. His popularity has decreased drastically.

The protests have been endorsed by over 3 000 members of Egypt’s 8 000-member journalist syndicate, including editors of most major private and even state-owned media outlets. Supported by the previously apolitical doctors’ syndicate, which opposes the interior ministry’s treatment of doctors, protesters have demanded the removal of the country’s interior minister, Magdy Abdel Ghaffar. The syndicate has refused to publish the minister’s name until an apology from Sisi is received, and has vowed to escalate actions into a full-blown strike in the coming weeks.

Traditional opposition parties such as the Muslim Brotherhood and activist youth groups such as the April 6 Youth Movement have added their voices, and for the first time since seizing power, Sisi faces a backlash from most major Egyptian constituencies. Prior to the large 15 and 25 April protests, the frequency of and attendance at anti-regime protests had been waning when compared to late 2013; however, the island transfer has galvanised many Egyptians. It seems even some officials in the interior ministry are sympathetic, and memos alluding to methods of regime discourse manipulation and instructions on constraining protests have been leaked. Much of the media had previously supported the regime, and endorsed Sisi’s crackdown on the Brotherhood, enabling him to control public discourse and silence opposition figures.

The regime responded by increasing its crackdown on opposition figures, including journalists, insisting in one leaked memo, that it ‘cannot retreat from this position now; a retreat would mean a mistake was made, and if there was a mistake who is responsible and who is to be held to account?’ Sisi has, in recent months. sought to silence opposition even from the supportive elite, insisting that it threatened the country’s stability. He even implored Egyptians in one speech to listen only to him.

In January 2016, the Al-Nadeem Centre for Rehabilitation of Victims of Violence in Cairo reported ‘195 deaths, 42 cases of torture, including eight people who were tortured to death, 60 cases of medical neglect, 20 cases of group violence by the police, and 66 forced disappearances, while 32 people were reported to have reappeared in various places of detention, in some cases months after they had vanished.’ Authorities subsequently shut down Al-Nadeem in February. It is noteworthy that the sentences issued to recent protesters are less punitive than those issued to people believed to be close to the banned Brotherhood. Six people, including three journalists (two from Al Jazeera) were sentenced to death on 7 May, accused of ‘leaking information to Qatar’.

Although opposition to the regime has increased, the regime remains unthreatened in the short term, especially since many Egyptians are content with the ‘stability’ Sisi’s rule brings. Moreover, the internal opposition is too fragmented, and the regime crackdown too heavy-handed to allow for the formation of a unified and coordinated stance. Moreover, many from within the Egyptian left and secularists are still prejudiced against the role of Islamists, specifically the Brotherhood, in a new dispensation, and are likely to advocate reform rather than revolution. The protests do, however, illustrate that Egyptians’ aspirations and expectations have grown since Mubarak’s overthrow, and that if Sisi’s policies to stimulate the economy continue to fail, Egyptians are unlikely to allow him the same amount of leeway as was afforded Mubarak, especially since the regime no longer operates from behind a liberal veneer.

By Afro-Middle East Centre

The recent handing over of two islands – Tiran and Sanafir – to Saudi Arabia by the Egyptian government emphasises that the Sisi regime remains so in need of external support to buttress its domestic control that it is willing to anger significant sections of the population. The islands’ importance to Israel and the fact that Israel agreed to the handover also point to strengthening cooperation between Tel Aviv, Riyadh and Cairo in an effort to contain Iran’s resurgence.

 

The announcement about the islands was made as the Saudi king, Salman bin Abdul Aziz, undertook his first official trip to Egypt since acceding to the thrown in January 2015. Other deals signed during his visit included a twenty-two billion dollar agreement for Saudi Arabia to supply Egypt with energy, and the establishment of a sixteen billion dollar joint Saudi-Egyptian investment fund. Recent tensions between the two regional powers had heightened after Egypt’s refusal to commit troops to the Saudi war in Yemen, and because of Egypt’s support for Russia's Syrian intervention. Egypt is also critical about strengthening ties between Riyadh and Ankara, and because of the Kingdom’s support for Yemen’s Muslim Brotherhood Islah party. Tensions had been simmering since Salman became king, however, with his suspicion that Egypt’s military ruler, Abdel Fatah el-Sisi, had plotted against his acceding to the throne.

 

Riyadh nevertheless views Egypt as an important ally in its attempt to counter growing Iranian influence in the region, and sees its large and well-equipped military as a critical deterrent to Iran’s regional forays. Moreover, Egypt’s Sidi Kerir port and SUMED oil storage terminal can be used by Saudi Arabia to slow down and disrupt Iranian oil exports. Before 2011 Iran had dispatched over 200 000 barrels of oil per day from the port, has used the storage terminal for oil shipped to Europe since diverting shipments through its own Kharg Island port causes a month delay. With this agenda, Salman has reduced his criticism of Egypt – and especially of Sisi – and continued to buttress it. Significantly, however, recent assistance packages to Egypt have been more as loans and investments than aid; only around two billion of the sixty billion in recent deals is aid.

 

But there is also a third player involved; for the transfer to have occurred Israel’s approval was required in terms of the 1979 Camp David Accords between Israel and Egypt. The two islands essentially block access to the Red Sea from the Gulf of Aqaba, thus blocking access to the critical Israeli port of Eilat. Israel thus regards control of the Tiran Straits and the waters around both islands as critical since much of its maritime trade passes through en route to Eilat. A perception that this access would be disrupted was a major factor informing Israel’s involvement in the 1956 Suez crisis and 1967 six day war. They were twice captured by Israel, which controlled them from 1967 to 1982. Guarantees over waterway access were thus key stipulations in the Camp David agreement. The transfer of the islands means Israeli vessels will now traverse Saudi waters to reach Eilat.

 

Tel Aviv’s acquiescence and statements by Israeli and Saudi officials indicate that firm guarantees had been provided by Saudi Arabia regarding Israel’s freedom of navigation through the Strait of Tiran. Israel has been informed about the secret negotiations regarding the islands from the beginning, and written guarantees that Riyadh would abide by the terms stipulated at Camp David were given in talks that involved Egypt, Saudi Arabia, Israel and the USA. (Although Israel and Saudi Arabia are officially in a state of war, they have collaborated on a number of issues recently, and Riyadh had informed Israel about then-secretive nuclear negotiations between the USA and Iran.)

 

For Egypt, transferring the islands to Saudi Arabia has little negative strategic implication. The islands are uninhabited, have few resources, and technically belonged to Saudi Arabia though administered on its behalf by Egypt since 1950, when Saudi Arabia requested Egypt to play this role, believing that Egypt could protect them from Israel. Returning the islands was thus an opportunity to renew Egypt’s relationship with Saudi Arabia, and to continue receiving assistance for Egypt’s stalling economy and Sisi’s power base.

 

The move has elicited much criticism from Egyptians, especially since Sisi had inserted a stipulation in Article 151 of the 2014 Egyptian Constitution prohibiting territorial transfers. The clause was intended to augment Sisi’s nationalist credentials, and because the army garnered support for its 2013 coup by arguing that the former president, Mohamed Morsi, was ceding parts of Sinai to Hamas, and endangering Egyptian sovereignty through his alliance with Qatar.

 

Sisi thus argued that the island transfer restores sovereignty to Saudi Arabia, which owns the islands, and was not a ceding of Egyptian territory. But prominent political figures such as Hamdeen Sabahi, Khaled Ali, Ayman Nour and the Muslim Brotherhood criticise this reasoning, and Ali has lodged court papers to halt the deal. Although this sees some fissures in the regime’s support base, it is unlikely to pose a significant threat.

The economic collapse in Egypt

  • Aug 21, 2017
  • Published in Egypt

By Yehia Hamid

All economic indicators in Egypt point to the fact that the country has entered a phase of serious economic collapse, for which it and its people will pay for many years, and which will have an impact on a large proportion of its people.

Indicators from the Egyptian Exchange show that it has lost 30 per cent within two years, and 27 billion Egyptian pounds ($3.4 billion) within only two weeks. Egypt’s feeble exchange is expected to continue its nosedive.

Egypt’s foreign currency reserves reached their worst levels since Egypt received nearly $50 billion from three Gulf states after the July 2013 coup in which General Abdel Fattah El-Sisi seized power. Most of these funds have been squandered. About $16.4 billion remain, and this amount is not sufficient to pay for the importation of basic commodities for more than two months.

Sisi, now president after being ‘elected’ in a sham election, requires $1.5 billion a month in order to remain in power. Reaching this target is becoming increasingly difficult because donor countries themselves face tough global economic circumstances, and because one of the main donors, Saudi Arabia, seems no longer to have the appetite to throw money Sisi’s way. The United Arab Emirates, the other big donor, is also tiring of the squandering f its money and of being treated like ‘an ATM machine’. Even if these countries were to continue to provide minimal support, that will not halt the economic decline that is felt by Egyptians.

Egyptian exports in general have fallen by 25 per cent, and the export of petroleum products has fallen by 19 per cent compared to the same period in 2014. Such numbers are due to a failure by the government on an economic level, the war it has waged on the private sector, and the monopoly of the political elite over all government tenders – completely shutting out smaller contractors.

Over the past two years, the government went further. It also fought against the activities of the ‘parallel economy’, which represents about 30 per cent of all economic activity. This battle has taken different forms in order to force small private businesses into the official market so as to reap taxes from these small workshops and their small unofficial activities. As a result, tens of thousands of people have lost their seasonal jobs, and around five million Egyptians served by these economic activities have been deprived of their services.

The business sector in Egypt, employing more than 300 000 Egyptians, is experiencing an extremely difficult time. It has suffered power shortages, a reduction in natural gas, and non-approval of funding required to renew necessary machinery and tools. Consequently, the situation in the sector has worsened as a result of a plan by the government to cripple these vital companies and force them to sell, thus benefiting from their cheap sale price or the cheap prices of their properties. Notable examples of this are the steel factory Najaa Hammadi Aluminium Factory and Al-Mahallah Textile Factory.

The country stands at the threshold of a collapse in the value of the Egyptian pound, which has lost 20 per cent of its value over the past two years and will likely be further devalued by the new Central Bank governor, Tarek Amer. The government, in the meanwhile, insists on collecting money from the Egyptians in a variety of ways – either through failed projects such as the Suez Canal water way extension project, or by hiking interest rates on saving certificates to 12.5 per cent, which are likely to rise even higher.

All the government’s ‘giant projects’ have either been cancelled or have failed. The Suez Canal expansion project, for which $8 billion was collected from citizens and for which a mandatory $1 billion of interest will have to be paid annually, is an example. The canal has already suffered a drop of 9.7 per cent of its revenues due to recent declines in world trade. In other words, the Suez Canal will this year likely attract a revenue of under $4 billion, compared to $5.4 billion in 2014 – despite the expansion project.

This failure is related to the complete absence of any legislative regulation or system of accountability. Sisi has purchased $8 billion worth of weapons, some of which are partly funded by regional powers while some will be paid for at a later stage by Egyptians, either through new taxes or through deductions from foreign aid.

The tourism sector suffered another collapse with the regime failing to protect it. Tourism were already low but were worsened recently with the killing of twelve Mexican tourists, and the deaths of 224 people in the Russian plane crash last month as a result of a security breach. The plane crash represented the beginning of a virtual freeze in tourism at the most crucial time – the commencement of the main tourism season of the year. Around two million Egyptians work in the tourism sector, either directly or indirectly, and more than eight million citizens will be affected by the failure of the government to salvage this important economic sector.

As if these indicators were not bad enough, the banking system is no longer able to save people’s money due to the Central Bank of Egypt lacking any independence or transparency. The bank’s current governor, Hisham Ramez, whose term ends at the end of November, was responsible for concealing billions of dollars of foreign funds that entered Egypt, had banned the publication of any credible information about the currency reserve, and refused to devalue the Egyptian pound in order to attempt to rescue the economy.

* Yehia Hamid is a former minister of investment in Egypt

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