Cairo: Egypt’s economy has been in crisis for years, but as the latest round of International Monetary Fund-backed reforms bites, much of the country’s middle class has found itself struggling to afford goods once considered basics.
The world lender has long backed measures in Egypt including a liberal currency exchange market and weaning the public away from subsidies.
On the ground, that has translated into an eroding middle class with depleted purchasing power, turning into luxuries what were once considered necessities.
Nourhan Khaled, a 27-year-old private sector employee, has given up “perfumes and chocolates.”
“All my salary goes to transport and food,” she said as she perused items at a west Cairo supermarket, deciding what could stay and what needed to go.
For some, this has extended to cutting back on even the most basic goods — such as milk.
“We do not buy sweets anymore and we’ve cut down on milk,” said Zeinab Gamal, a 28-year-old housewife.
Most recently, Egypt hiked fuel prices by 17.5 percent last month, marking the third increase just this year.
Mounting pressures
The measures are among the conditions for an $8 billion IMF loan program, expanded this year from an initial $3 billion to address a severe economic crisis in the North African country.
“The lifestyle I grew up with has completely changed,” said Manar, a 38-year-old mother of two, who did not wish to give her full name.
She has taken on a part-time teaching job to increase her family’s income to 15,000 Egyptian pounds ($304), just so she can “afford luxuries like sports activities for their children.”
Her family has even trimmed their budget for meat, reducing their consumption from four times to “only two times per week.”
Egypt, the Arab world’s most populous country, is facing one of its worst economic crises ever.
Foreign debt quadrupled since 2015 to register $160.6 billion in the first quarter of 2024. Much of the debt is the result of financing for large-scale projects, including a new capital east of Cairo.
The war in Gaza has also worsened the country’s economic situation.
Repeated attacks on Red Sea shipping by Yemen’s Houthi rebels in solidarity with Palestinians in Gaza have resulted in Egypt’s vital Suez Canal — a key source of foreign currency — losing over 70 percent of its revenue this year.
Amid growing public frustration, officials have recently signalled a potential re-evaluation of the IMF program.
“If these challenges will make us put unbearable pressure on public opinion, then the situation must be reviewed with the IMF,” President Abdel Fattah El-Sisi said last month.
Prime Minister Mostafa Madbouly also ruled out any new financial burdens on Egyptians “in the coming period,” without specifying a timeframe.
Economists, however, say the reforms are already taking a toll.
Wael Gamal, director of the social justice unit at the Egyptian Initiative for Personal Rights, said they led to “a significant erosion in people’s living conditions” as prices of medicine, services and transportation soared.
He believes the IMF program could be implemented “over a longer period and in a more gradual manner.”
’Bitter pill to swallow’
Egypt has been here before. In 2016, a three-year $12-billion loan program brought sweeping reforms, kicking off the first of a series of currency devaluations that have decimated the Egyptian pound’s value over the years.
Egypt’s poverty rate stood at 29.7 percent in 2020, down slightly from 32.5 percent the previous year in 2019, according to the latest statistics by the country’s CAPMAS agency.
But Gamal said the current IMF-backed reforms have had a “more intense” effect on people.
“Two years ago, we had no trouble affording basics,” said Manar.
“Now, I think twice before buying essentials like food and clothing,” she added.
Earlier this month, the IMF’s managing director Kristalina Georgieva touted the program’s long-term impact, saying Egyptians “will see the benefits of these reforms in a more dynamic, more prosperous Egyptian economy.”
Her remarks came as the IMF began a delayed review of its loan program, which could unlock $1.2 billion in new financing for Egypt.
Economist and capital market specialist Wael El-Nahas described the loan as a “bitter pill to swallow,” but called it “a crucial tool” forcing the government to make “systematic” decisions.
Still, many remain skeptical.
“The government’s promises have never proven true,” Manar said.
Egyptian expatriates send about $30 billion in remittances per year, a major source of foreign currency.
Manar relies on her brother abroad for essentials, including instant coffee which now costs 400 Egyptian pounds (about $8) per jar.
“All I can think about now is what we will do if there are more price increases in the future,” she said.
Egypt’s middle class cuts costs as IMF-backed reforms take hold
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Egypt’s middle class cuts costs as IMF-backed reforms take hold
- The world lender has long backed measures in Egypt including a liberal currency exchange market and weaning the public away from subsidies
Syrian soldiers distance themselves from Assad in return for promised amnesty
- Lt. Col. Walid Abd Rabbo, who works with the new Interior Ministry, said the army has been dissolved and the interim government has not decided yet on whether those “whose hands are not tainted in blood” can apply to join the military again
DAMASCUS, Syria: Hundreds of former Syrian soldiers on Saturday reported to the country’s new rulers for the first time since Bashar Assad was ousted to answer questions about whether they may have been involved in crimes against civilians in exchange for a promised amnesty and return to civilian life.
The former soldiers trooped to what used to be the head office in Damascus of Assad’s Baath party that had ruled Syria for six decades. They were met with interrogators, former insurgents who stormed Damascus on Dec. 8, and given a list of questions and a registration number. They were free to leave.
Some members of the defunct military and security services waiting outside the building told The Associated Press that they had joined Assad’s forces because it meant a stable monthly income and free medical care.
The fall of Assad took many by surprise as tens of thousands of soldiers and members of security services failed to stop the advancing insurgents. Now in control of the country, and Assad in exile in Russia, the new authorities are investigating atrocities by Assad’s forces, mass graves and an array of prisons run by the military, intelligence and security agencies notorious for systematic torture, mass executions and brutal conditions.
Lt. Col. Walid Abd Rabbo, who works with the new Interior Ministry, said the army has been dissolved and the interim government has not decided yet on whether those “whose hands are not tainted in blood” can apply to join the military again. The new leaders have vowed to punish those responsible for crimes against Syrians under Assad.
Several locations for the interrogation and registration of former soldiers were opened in other parts of Syria in recent days.
“Today I am coming for the reconciliation and don’t know what will happen next,” said Abdul-Rahman Ali, 43, who last served in the northern city of Aleppo until it was captured by insurgents in early December.
“We received orders to leave everything and withdraw,” he said. “I dropped my weapon and put on civilian clothes,” he said, adding that he walked 14 hours until he reached the central town of Salamiyeh, from where he took a bus to Damascus.
Ali, who was making 700,000 pounds ($45) a month in Assad’s army, said he would serve his country again.
Inside the building, men stood in short lines in front of four rooms where interrogators asked each a list of questions on a paper.
“I see regret in their eyes,” an interrogator told AP as he questioned a soldier who now works at a shawarma restaurant in the Damascus suburb of Harasta. He spoke on condition of anonymity because he was not allowed to talk to media.
The interrogator asked the soldier where his rifle is and the man responded that he left it at the base where he served. He then asked for and was handed the soldier’s military ID.
“He has become a civilian,” the interrogator said, adding that the authorities will carry out their own investigation before questioning the same soldier again within weeks to make sure there are no changes in the answers that he gave on Saturday.
The interrogator said after nearly two hours that he had quizzed 20 soldiers and the numbers are expected to increase in the coming days.
Israel accuses Pope of ‘double standards’, after Gaza criticism
JERUSALEM: Israel accused Pope Francis of “double standards” Saturday after he condemned the bombing of children in Gaza as “cruelty” following an air strike that killed seven children from one family.
“The Pope’s remarks are particularly disappointing as they are disconnected from the true and factual context of Israel’s fight against jihadist terrorism — a multi-front war that was forced upon it starting on October 7,” an Israeli foreign ministry statement said.
“Enough with the double standards and the singling out of the Jewish state and its people.”
Gaza’s civil defense rescue agency had reported that an Israeli air strike killed 10 members of a family on Friday in the northern part of the Palestinian territory, including seven children.
“Yesterday they did not allow the Patriarch (of Jerusalem) into Gaza as promised. Yesterday children were bombed. This is cruelty, this is not war,” he told members of the government of the Holy See.
“I want to say it because it touches my heart.”
The Israeli statement said: “Cruelty is terrorists hiding behind children while trying to murder Israeli children; cruelty is holding 100 hostages for 442 days, including a baby and children, by terrorists and abusing them,” a reference to the Palestinian Hamas militants who attacked Israel and took hostages on October 7, 2023, triggering the Gaza war.
“Unfortunately, the Pope has chosen to ignore all of this,” the Israeli ministry said.
American pilots in ‘friendly fire’ incident as US military hits Houthi targets in Sanaa
DUBAI: Two US Navy pilots were shot down over the Red Sea in an apparent “friendly fire” incident, the US military said Sunday. Both pilots were recovered alive, with one suffering minor injuries in the incident.
The incident came as the US military conducted airstrikes targeting Yemen’s Houthi rebels, though the US military’s Central Command did not elaborate on what their mission was at the time.
“The guided missile cruiser USS Gettysburg, which is part of the USS Harry S. Truman Carrier Strike Group, mistakenly fired on and hit the F/A-18, which was flying off the USS Harry S. Truman,” Central Command said in a statement.
The command said on X, shortly after midnight local time: “CENTCOM forces conducted the deliberate strikes to disrupt and degrade Houthi operations, such as attacks against U.S. Navy warships and merchant vessels in the Southern Red Sea, Bab al-Mandeb, and Gulf of Aden,”
The video released by the US military showed a jet taking off from a carrier.
“During the operation, CENTCOM forces also shot down multiple Houthi one way attack uncrewed aerial vehicles (OWA UAV) and an anti-ship cruise missile (ASCM) over the Red Sea.”
Videos on social media showed people fleeing large explosions in the capital, but Arab News could not immediately verify the authenticity of the footage.
The command said that US air and naval assets were used in the operation, including F/A-18s, adding the “strike reflects CENTCOM's ongoing commitment to protect U.S. and coalition personnel, regional partners, and international shipping.”
The Houthis, who control large parts of Yemen, seized the capital in 2014 and have been conducting drone and missile attacks on international shipping in the Red Sea in an effort to impose a naval blockade on Israel, who, for more than a year, has been carrying out a devastating war against Hamas in Gaza.
Earlier on Saturday, a Houthi missile hit Tel Aviv, injuring 16 people.
Syria’s SDF says five fighters killed in strikes by Turkish-backed forces
- Turkiye regards the PKK, YPG and SDF as terrorist groups
CAIRO: The US-allied Syrian Democratic Forces (SDF) said five of its fighters had been killed on Saturday in attacks by Turkish-backed forces on the city of Manbij in northern Syria.
Fighting in Manbij broke out after Bashar Assad was toppled nearly two weeks ago, with Turkiye and the Syrian armed groups it supports seizing control of the city from the Kurdish-led SDF on Dec. 9.
The SDF, an ally in the US coalition against Daesh militants, is spearheaded by the YPG — a group that Ankara sees as an extension of the Kurdistan Workers Party (PKK) militants who have fought the Turkish state for 40 years.
Turkiye regards the PKK, YPG and SDF as terrorist groups.
The United States has been mediating to stop fighting between Turkiye and the Syrian Arab groups it supports, and the SDF.
The US State Department said on Wednesday a ceasefire around Manbij had been extended until the end of the week, but a Turkish defense ministry official said a day later there was no talk of a ceasefire deal with the SDF.
In Israeli-occupied south Syria, villagers feel abandoned
- Most villagers have cloistered themselves inside their homes since the troops arrived. A few look on through windows and from rooftops
QUNEITRA, Syria: In the towns and villages of southern Syria that Israel has occupied since the overthrow of longtime strongman Bashar Assad, soldiers and residents size each other up from a distance.
The main street of the village of Jabata Al-Khashab is largely deserted as a foot patrol of Israeli troops passes through it.
Most villagers have cloistered themselves inside their homes since the troops arrived. A few look on through windows and from rooftops.
It is the same story in nearby Baath City, named for the now suspended political party that ran Syria for more than 60 years until Assad’s ouster by Islamist-led rebels earlier this month.
The town’s main street has been heavily damaged by the passage of a column of Israeli tanks.
The street furniture has been reduced to mangled metal, aand broken off branches from roadside trees litter the highway.
“Look at all the destruction the Israeli tanks have caused to our streets and road signs,” said 51-year-old doctor Arsan Arsan.
“People around here are very angry about the Israeli incursion. We are for peace, but on condition that Israel pulls back to the armistice line.”
Israel announced on December 8 that its troops were crossing the armistice line and were occupying the UN-patrolled buffer zone that has separated Israeli and Syrian forces on the strategic Golan Heights since 1974.
The announcement, which was swiftly condemned by the United Nations, came the same day that the rebels entered Damascus.
Israel said it was a defensive measure prompted by the security vacuum created by the Assad government’s abrupt collapse.
Israeli troops swiftly occupied much of the buffer zone, including the summit of Syria’s highest peak, Mount Hermon.
The Israeli military has since confirmed that its troops have also been operating beyond the buffer zone in other parts of southwest Syria.
At a security briefing on Mount Hermon on Tuesday, Israeli Defense Minister Israel Katz spoke of the importance of “completing preparations... for the possibility of a prolonged presence” in the buffer zone.
He added that the 2,814-meter (9,232-foot) peak provided “observation and deterrence” against both Hezbollah in Lebanon and the new authorities in Damascus who “claim to present a moderate front but are affiliated with the most extreme Islamist factions.”
Hayat Tahrir Al-Sham (HTS), the Islamist group that led the rebel overthrow of Assad, has its roots in Al-Qaeda and remains proscribed as a terrorist organization by several Western governments, even though it has sought to moderate its image in recent years.
On the road south from Damascus to the provincial capital Quneitra, an AFP correspondent saw no sign of the transitional government or its fighters. All of the checkpoints that had controlled access to the province for decades lay abandoned.
Quneitra’s streets too were largely deserted as residents stayed indoors, peeking out only occasionally at passing Israeli patrols.
Israeli soldiers have raised the Star of David on several hilltops overlooking the town.
HTS leader Ahmed Al-Sharaa has said that Israel’s crossing of the armistice line on the Golan “threatens a new unjustified escalation in the region.”
But he added in a statement late last week that “the general exhaustion in Syria after years of war and conflict does not allow us to enter new conflicts.”
That position has left many in the south feeling abandoned to fend for themselves.
“We are just 400 meters (yards) from the Israeli tanks... the children are scared by the incursion,” said Yassin Al-Ali, who lives on the edge of the village of Al-Hamidiyah, not far from Baath City.
He said that instead of celebrating their victory in Damascus, the transitional government and its fighters should come to the aid of Quneitra province.
“What’s happening here really should make those celebrating in Umayyad Square pause for a moment... and come here to support us in the face of the Israeli occupation,” Ali said.
