Egypt economy biggest challenge for new government
Egypt’s deteriorating economy was believed to be among the main reasons behind January 25, 2011 revolution which ousted former president Hosni Mubarak.
Subsequently the failure to improve the economy led to the recent toppling of former president Mohammad Mursi on June 30, 2013.
Today, the economic situation is being listed high on the challenges facing current government in Egypt, after political instability has further deepened the economic crisis in Egypt.
This has led investors and tourists to stay away from Egypt, depriving the country from much-needed foreign currency and further complicating efforts to import food and fuel. Egypt, the largest Arab country in terms of population, is having a “socioeconomic time bomb”, former Finance Minister Samir Radwan was quoted as saying in a recent press report.
He was referring to the combination of high the unemployment rate among Egyptians, mainly among the youth and the high rate of poverty and faltering rate of domestic economic growth.
Unemployment in Egypt, with a population of nearly 85 million, has reached 13.2 per cent in the first quarter of 2013, according to figures of Egypt’s Central Agency for Public Mobilisation and Statistics.
Also, nearly 40 per cent of Egyptians live under poverty line. While Egypt’s fuel shortage has caused a dramatic rise in diesel and gasoline, worries over food supply have increased.
Prices of food commodities witnessed not only price increases, but also shortages.
According to UN World Food Programme, 17 per cent of the country faced a shortage of food in 2011, up from 14 per cent in 2009. Bassem Ouda, a former minister of supplies in the ousted Mohammad Mursi’s regime, said on Thursday that Egypt has less than two months supply of imported wheat left in its stocks.
The country, he was quoted as saying, has just 500,000 metric tons of imported wheat left from nearly 10 million metric tones of the country’s usual annual imports.
Egypt is considered the world’s largest importer of wheat; half of it is being distributed to the population in the form of heavily subsidized bread.
Each loaf of bread which is being sold to people for less than 1 US cent (3.67 fils). Realising the dire economic crisis Egypt is facing, many countries extended helping hands to fix the economic and financial troubles.
United Arab Emirates, Saudi Arabia and Kuwait have promised $12 billion in cash, loans and fuel since Musri’s regime was toppled late last June.