Egyptian President Abdel Fattah al-Sisi listed on eBay
Few Arab leaders today would want to be compared with Colonel Muammar Gaddafi, the Libyan dictator who met a grisly end. Fewer still would invite that comparison, by quoting the words Gaddafi uttered from the ruins of a building destroyed by US air raids in 1986.
His words have gone down in history. They express the rage and incomprehension of a dictator losing his grip. What possessed Egypt’s President Abdel Fattah al-Sisi to quote them in a speech last week?
“Who are you? No one can come close to Egypt… I swear in the name of Almighty Allah that who ever comes close to Egypt..., I shall make disappear from the face of the earth.”
Sisi said much else besides those words: that he alone knew what he was doing, that every Egyptian who wakes up each day should donate one Egyptian pound to the government; that if he, Sisi, could be sold,
he would sell himself for the sake of Egypt; that it was too early for democracy; and that Egyptians should listen to no-one but him.
Sisi shouted, “Please, do not listen to anyone but me! I am dead serious! Do not listen to anyone but me!”
Spells of hysterical laughter, rants against his own government, and tears of grief punctuated his speech. That an Egyptian president should produce this performance at the launch of a project entitled “Egypt’s strategy for sustained development… Egypt’s vision 2030”, defies belief. He was instantly
lampooned on social media.
The speech was not the first to cause supporters to doubt his judgment. In a video conference, Sisi told Egyptians to tighten their belts when he inaugurated a series of development projects in several governorates. He said water subsidies cost 40 million Egyptian pounds a day, a burden the state was no longer able to bear.
“The state cannot continue this way. It is not that it doesn't want to, but it simply cannot," he said.
On his way to the video conference, his presidential motorcade drove over a
red carpet three miles long. Brigadier General Ehab el-Ahwagy explained that the red carpet brought “joy and assurance to the Egyptian citizen - that our people and our land and our armed forces are always capable of organising anything in a proper manner”.
That is not how Egypt’s financial markets see things. The Egyptian pound has dropped to record lows on the black market, reaching nine per dollar, and increasing pressure on the government to devalue. Foreign currency reserves have halved since the revolution in 2011. They have gone from $36bn on 25 January 2011, to $16.4bn today. This is despite an injection of up to $50bn from Saudi Arabia, the Emirates and Kuwait, which Sisi got from August 2013 to January 2014, and a further injection of $12bn in bailout cash it received in March 2014. Foreign reserves are now the equivalent of three months imports, the minimum cushion recommended by the International Monetary Fund.
Traditional sources of foreign currency
have dried up. Tourism, which generates 9 to 11 percent of the foreign currency, fell by 46 percent last month compared to the previous period last year. Revenue from the Suez Canal decreased in the year in which the canal was enlarged at a cost of $8.2bn. The chairman of the Suez Canal Authority, Vice-Admiral Mohab Mamish, claimed the expansion would more than double annual revenues to $13.5bn by 2023. Last year they fell from $5.5bn to $5.2bn.
Foreign investment now stands at 40 percent of what it was in 2007, although the attitude of one foreign investor in particular should be causing Sisi concern. Saudi Arabia, under the management of King Salman, is proving to be an altogether less Sisi-friendly experience than under King Abdullah, who bankrolled Egypt’s military coup.
There are a number of reasons for the frost between Riyadh and Cairo. Abdullah’s inner circle campaigned vigorously against Salman’s secession, as did the Egyptian media to whom they were subservient. The kingdom is also running out of money as a result of the crash in the oil prices, which it instigated to squeeze US shale oil producers out of the market.
But perhaps the most important unspoken reason is that Salman’s inner court no longer sees Sisi, personally, as a safe bet. This does not mean Saudi Arabia is about to abandon its belief that Egypt can only be ruled by a field marshal. But it could mean that the king would not go into mourning if one Egyptian general replaced another, which currently is the most likely scenario.
The evidence for Saudi’s new tough line can only be glimpsed. But it is there. In December, Saudi agreed to invest 30 billion riyals ($8bn) in Egypt through its public and sovereign funds, to help Egypt overcome its foreign currency crisis.
Bloomberg commented that the promise of funds suggested that the kingdom remained committed to supporting Egypt, despite plunging oil prices and the war in Yemen. Al Masry Al Youm has now reported that the Saudi side of the Egyptian Saudi Coordination Council rejected a large number of the projects, which would have attracted the $8bn investment. According to that newspaper’s sources, negotiations are tough, with the Saudi side looking on these projects from a hard, commercial view only.
The days when Sisi
sniggered to his aides about how much money the Gulf countries have (“they have money like rice”) are over. Signs of a cash-strapped Egypt are everywhere. There are drug shortages because the Egyptian pharmaceutical industry has to pay for the raw material in dollars and charge for drugs in Egyptian pounds. In December last year there were 232 drugs in short supply, including 43, which have no substitute.
Biopharma Dive reported: “Drug prices are fixed by the Egyptian Health Ministry, meaning raw material costs are cutting into producers' margins. The net impact has been for producers to opt out of making certain drugs to decrease the losses.”
Gulf News reported that Air France/KLM had been unable to transfer 100 million Egyptian pounds of earnings out of the country since October due to the dollar shortage.
Cees Ursem, Egypt country manager, said: “It is a very, very serious problem because all our revenues are blocked at the bank, but at the same time we do have all the same costs ongoing like leasing the aircraft, the fuel, the staff, overflying rights, ground handling etc, which have to be paid in dollars, so how do you suppose that we can sustain these operations?”
A shipment of liquefied natural gas from BP was diverted to Brazil in January after Egypt froze payments until March,
reported. It said Egypt owes $3bn to international oil companies - money that is unlikely to be repaid before the end of 2017.
Gradually the world is closing in on Sisi, which is why, as the crisis of his rule deepens, he appears to have become more detached from reality. Sisi’s behaviour is incomprehensible even to his supporters.
By rights, Sisi should by now have established a party of government, or at least a group of oligarchs who could share the burden of governance. Instead, he appears to be doing the opposite, playing the pharaoh, anointed by God, who alone bears the fate of Egypt in his hand.
This pharaoh has burned his way through untold billions of dollars of cash. In the process, he has discarded most of those who supported his coup against the Muslim Brotherhood president. As time marches on, Sisi can no longer blame them for the chaos Egypt is in. The open criticism welling up in the media is a symptom of a wide swathe of dissatisfaction running through his own clan. Eventually Sisi will run out of excuses and like Gaddafi run out of words.
“Who are you?” he will ask again. “Egypt,” the reply will come.
- David Hearst is editor-in-chief of Middle East Eye. He was chief foreign leader writer of The Guardian, former Associate Foreign Editor, European Editor, Moscow Bureau Chief, European Correspondent, and Ireland Correspondent. He joined The Guardian from The Scotsman, where he was education correspondent.
The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Eye.
Photo: Egyptitan President Abdel Fattah al-Sisi inaugurates the 2016 Africa business and investment forum (AFP)
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