News / Economy

Egypt's Unrest Hurts Economy

A HSBC bank branch remains damaged on the Arcadia shopping center, that was looted, damaged and set on fire by people in Cairo, Egypt, January 30, 2011.
A HSBC bank branch remains damaged on the Arcadia shopping center, that was looted, damaged and set on fire by people in Cairo, Egypt, January 30, 2011.
TEXT SIZE - +

With an inflation rate near 13 percent and about 20 percent of Egypt's population living at or below the poverty level,  finding even the most basic necessities has become a daily struggle for many Egyptians. It is a situation many analysts say is bound to get worse the longer the protests continue.

"We've been standing in line for five hours just to get some bread; people are fighting over it. They are not happy with Mubarak. Look what they have gotten us into," said one man/

Although some blame the protests for the food shortages, even more blame President Hosni Mubarak's policies for the decline of Egypt's middle class.  

Elliott Abrams, a foreign policy analyst at the Council on Foreign Relations, says the crisis has been years in the making. "People are asking for two things fundamentally.  They're asking for freedom and they are asking for bread.  Egypt has had a lot of economic growth, a lot of stock market rise, a lot of foreign direct investment.  But, it is not trickling down.  The rich are getting a lot richer; the poor are not getting richer," he said.

Despite economic reforms that have doubled Egypt's Gross Domestic Product since 2004, nearly 40 percent of Egypt's population gets by on less than $2 a day.  

"It used to be that college graduates, they get a sort of basic salary from the government and then they go out and get a second job to make ends meet. Today, people who are graduating in the past three years have a terrible problem getting enough money for housing, for a decent living. This economic discontent is behind the political discontent that is now rocking Egypt," said David Ottaway, the Washington Post's former Cairo Bureau Chief.

The unrest also threatens one of Egypt's most important sources of income - tourism, which supports one in every eight jobs. Thousands of tourists have cancelled visits and airlines say the busiest flights are outbound - as many more try to flee the country.

But at one Cairo's busiest bazaars, Canadian tourist Gary Lion says for now, at least, the protests seem a world away. "Of course we are not really used to what it should look like. This is still reasonably busy but we found the people here very warm and friendly, helpful and we really haven't encountered any problems," he said.

Outside the tourist bubble, Egypt's stock market and banks remained closed on Monday.  Analysts say the government's shutdown of the Internet continues to disrupt commerce - hurting thousands of companies that use the Internet to buy and sell goods.

Despite the tumultuous events that have rocked the country, Egypt's Suez Canal, a key passage for nearly 10 percent of the world's oil and other commodities, remains open.

But some are starting to question whether the canal will continue to remain isolated from the unrest.

NEW: Follow our Middle East reports on Twitter
and discuss them on our Facebook page.

You May Like

Multimedia Parents of Disaster Ferry Passengers Lash Out at Authorities

Twenty-nine bodies recovered from water but some 270 remain trapped on board More

War Legacy Haunts Vietnam, US Relations

US congressional delegation initiates $84 million Agent Orange cleanup project More

Wikipedia Proves Useful for Tracking Flu

Technique gave better results than Center for Disease Control (CDC) and Google’s Flu Trends More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ukraine, Russia, United in Faith, Divided in Politicsi
X
Michael Eckels
April 19, 2014
There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Ukraine, Russia, United in Faith, Divided in Politics

There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid

World Currencies

EUR
USD
0.7217
JPY
USD
102.17
GBP
USD
0.5949
CAD
USD
1.1009
INR
USD
60.326

Rates may not be current.