Egypt: Deeper Uncertainty or Ray of Hope?
Andrei AKULOV | 05.07.2013 | WORLD

Egypt: Deeper Uncertainty or Ray of Hope?

On hearing the announcement of President Mohammed Morsi’s ouster, Tahrir Square exploded in a frenzy of fireworks and shouts of jubilation which quickly spread across the country. On July 3 the Egypt’s military removed the country’s first democratically elected president, suspended the Constitution and brought to power an interim government presided over by the country’s Chief Justice. Armored military vehicles are out on the streets of the capital, the presidential palace is surrounded by military and the Islamists are ringed in. Troops, including commandos, are deployed at key facilities in the capital and positioned so as to seal off and separate rival groups of demonstrators. This is a bitter end to the Morsi’s tumultuous rule that has alienated millions of his countrymen by displaying scorn for opposition against the background of economy going down.

The ban to travel is imposed on Mr. Morsi and other top Brotherhood leaders. The Muslim Brotherhood’s media outlets are taken away from the air, some personnel arrested, including those who worked at a branch of the Al Jazeera network. The state television denounces the Brotherhood activities. The Egyptian military have issued arrest warrants for 300 members of Morsi’s Muslim Brotherhood political party. Top Brotherhood officials will be tried for «crimes» committed during their year in office. Prime Minister Hisham Kandil and the remaining ministers have left their offices with their possessions. It is unclear if Brotherhood will compete in parliamentary elections. It urged Islamists to resist. Dr. Mohammed El-Baradei, a leader of the anti-Morsi opposition, stated that he hopes «all of us come back as reconciled people together. I hope that this 'road map' will be a beginning to continue with the revolution for which the Egyptian people have spent dearly to achieve social justice for every Egyptian man and woman». It’s interesting to note that the ultraconservative Islamist Nour Party, which quickly endorsed the plan, has joined other political groups in accusing Mr. Morsi and the Brotherhood of monopolizing power at the price of a dangerous political polarization

Takeover and declared intentions

The military brass hats call the takeover a «national reconciliation», not a coup. At a televised news conference in July 3 Gen. Abdul-Fattah el-Sisi, the Minister of Defense, said that the military had no interest in politics and was ousting Mr. Morsi because he had failed to fulfill «the hope for a national consensus». According to him, «the armed forces were the one to first announce that it is out of politics». General Sisi has also laid out a plan for a return to civilian governance. He made no mention of any period of military rule and granted the acting president, Mr. Mansour, the power to issue «constitutional decrees» during the transition. The top military leader called for the formation of a «technocratic government» to administer affairs during the transition and also of a politically diverse committee of experts to draft constitutional amendments. The Constitutional Court would set the rules for the parliamentary and presidential elections, and the court would also «put forward a code of ethics to guarantee freedom of the press and achieve professionalism and credibility» in the news media. New Egypt president Adli Mansour promises early elections. After taking the oath of office, he said that Mr. Morsi’s removal was «to correct the path of the glorious revolution and gather the people together without discrimination». «It was an expression of the conscience of the nation, the expression of its ambition and aspiration», he said in a short televised speech, adding that the «early parliamentary and presidential elections» would be conducted «according to the will of the people». According him, «This is the only safe way to a better tomorrow, to more freedom and more justice».

The role of military in Egyptian society

For six decades before 2011, the military ruled Egypt. The country has the largest standing military in the Arab world, estimated at 450,000 troops. Most are conscripts and low-ranking officers who have little opportunity for advancement. For decades, however, its tens of thousands of elite officers have jealously guarded their privileged station. They live as a walk of life apart, with their own social clubs, hotels, hospitals, parks and other benefits financed by the state. Many have also have gained personal wealth through government contracts and business deals facilitated by their positions. In some respects, the commissioned officers are an hereditary caste and they live inside a closed social circle. Besides the Brotherhood, the armed forces officers’ corps is a tightly knit group and the only really cohesive institution in the country.

In 2012 the military welcomed former President Morsi allowing them to exit from the accountability of governing but leaving perks untouched. The situation changed as the Brotherhood failed. The economy continued to plunge, and fuel shortages and power cuts caused anger in the streets. When Morsi actually endorsed the calls for jihad in Syria, he raised fears of a new generation of Egyptians coming home after getting combat experience in a foreign war…

Woes and grassroots sentiments

There is a worry that a coup would lead the EU and the United States to suspend their cooperation programs with Egypt. That would endanger Egypt’s fragile economy even further and therefore create even more instability.

These are difficult days for the country. Unemployment is 13%. 21.4 % of the 27.3 million strong workforce are temporary workers and at least 46.5 percent of those employees work in the unofficial sector without contracts. Furthermore, 67 percent has no health insurance. Since Egypt's 2011 revolution, persistent political uncertainty and plummeting domestic security have undermined foreign investment and harmed the country's once-vibrant tourism industry. According to the Interior Ministry, the past year has witnessed a 120 percent increase in murders, 350 percent increase in robberies, and 145 percent jump in kidnappings. Foreign currency reserves dropped from approximately $36 billion at the time of Hosni Mubarak's ouster to $14.42 billion at the end of April 2013. Climate, water, food and population pressures are now interweaving with the political and economic ones in ways. Rising employment, widespread poverty (with 25 percent living under the poverty line), and poor working conditions were all factors behind the January 2011 revolution that toppled the Mubarak regime. Due to a moribund economy, fuel and food shortages and a lack of political opportunities, the country faces tumultuous times ahead.

Egypt greatly depends on US aid. US President Barack Obama said the United States is «deeply concerned by the decision of the Egyptian Armed Forces to remove President Morsi and suspend the Egyptian constitution». A U.S. law requires a cutoff of military assistance to any country that undergoes a coup. Obama never used the word coup. The law gives the State Department discretion to decide whether a coup has taken place. The debates over the future of US aid have already started on Capitol Hill. The U.S. gives Egypt about $1.5 billion in annual aid, of which $1.3 billion is in the form of military assistance. Much of the aid is required by the 1979 peace treaty with Israel but U.S. law bars funding for countries that are ruled by the military. Underlying the importance of keeping ties to Egypt's military, Secretary of State John Kerry in May quietly approved $1.3 billion in military assistance, even though the country did not meet democracy standards set by the U.S. Congress for it to receive the aid. The US influence is felt, for instance, the head of the Egyptian armed forces, General Abdel Fattah al-Sisi, spent a year at the U.S. Army War College in Pennsylvania from 2005 to 2006.

Egypt has been in discussions with the International Monetary Fund (IMF) for a $4.8 billion aid package. The IMF is likely to wait until it is clear who is in charge in Egypt before considering whether to renew talks on a $4.8 billion loan program. The Washington-based lender traditionally does not do business with countries undergoing serious political turmoil. More than 1 million people have swelled the ranks of Egypt’s unemployed since the first quarter of 2010, bringing joblessness to a record 13.2 percent in the same period this year.

There is a big trouble in the air adding to other Egypt’s woes. Ethiopia has started the construction of the biggest hydroelectric dam in Africa, on the Blue Nile. As soon as the reservoir behind the dam is filled up, the water supply to Egypt is likely to go down. Egypt’s 85 million people get 97 percent of their fresh water from the Nile, so there is a burning issue on the Egyptian government’s agenda. Some senior Egyptian officials speak of possible military action to prevent the dam from being completed.

A Pew survey of Egyptian public opinion released in May showed 66% of Egyptians preferred democracy to any other form of government, and 51% were willing to live under a democratic government even if there is a risk of instability. Yet, when asked if they preferred «strong democracy over a strong economy», only 45% agreed, while 52% said that living in a good economy was more important to living in a democracy. The same survey highlighted Egyptians' growing economic pains and worries. Only 29% of those surveyed said they expected their economic situation to improve next year, a result down from 50 % in 2002. Some 42 %thought their economic situation would worsen next year, up from 20% last year. 76 % of respondents believed the plight of national economy was «bad».

Specific features

True, Morsi was not as successful as hoped. His presidency saw the rise of Salafist radicalism, attacks on religious minorities, power grabs in the absence of parliamentary scrutiny, fuel shortages, breakdown in law and order, flight of capital and investment, sharp declines in tourism and ongoing mass protests. He was surrounded by arrogant advisers who saw governing Egypt as their entitlement. But violent crowds demanding and getting democratically elected leaders resignations instead of waiting for next scheduled election is hardly an option. It will keep strongmen at the helm. On the other hand, if elections bring to power the people who grab it to hold forever and substitute secular laws with the ones they see fit calling for intervention against neighbors (Syria, for instance), it is not what serves national interest. That’s the situation’s specific feature. Neither the Muslim Brotherhood, nor the military, nor secular rule oriented parties can rule the country alone without bringing others in. So, what we have now is the democratic movement in Egypt calling on the military to oust a democratically elected president to get democracy back. Most Egyptians demand more jobs, better living standards, an end to police brutality, and a more dignified life in their homeland. But they are differ on how to meet those demands. Tens of millions of Egyptians continue to support Morsi and the Muslim Brotherhood, just as tens of millions of other Egyptians view them as dangerous failures. Some of these are most worried about the Brotherhood's desire to further Islamicize Egyptian society and public life; others are uncomfortable with the neo-liberal economic policies the Brothers favor; and still others merely want a do-over.

What the country really needs

The country needs drastic reforms that could be implemented only by broad national unity coalition. Reconciliation, not division, is what the country needs and what the military should try to achieve. The Morsi’s mistake was to behave like a real popular leader who can do whatever he wants taking advantage of guaranteed public support, though his win was marginal, many people abstained, many voted for him because they saw no other alternative and were choosing the lesser evil. A democratic election is not guaranteed to produce a democratic result.

The military may cede power to elected officials but it remains the decisive force in Egypt, and it’s better than chaos and civil war. Whatever, purely political matters set the agenda at present, but the real issues are economic ones: feeding families and providing jobs. The weak point is Egypt’s dependence on petrodollar infusions from Arab donors like Qatar, or the US and IMF, while political tension and civil strife keep away foreign investment into economy, as well as keeping tourists away, the branch of national economy so many people depend on. Egypt has received the first of 20 F-16s scheduled to be delivered this year by the U.S. as part of the annual $1.2 billion in military aid. This money will not be spent for urgent economic needs of Egyptian grassroots.

Russia-Egypt cooperation: new options

Against this backdrop, the number of Russian tourists who opted for Egypt as their getaway in 2012 rose by 30%. Trade turnover between Russia and Egypt rose to 3.5 billion dollars last year. Russia Russia-Egypt summit took place in the southern city of Sochi in April amid the 70th anniversary of diplomatic relations between the two nations. Back then Egyptian President Mohammed Morsi has offered Russia to jointly modernize several facilities in Egypt, including a metallurgic factory, an aluminum plant and the Aswan high dam. He said there was a great future ahead for Russian-Egyptian cooperation that would combine Egypt’s experience and Russian technological innovations. He added Egypt would readily tap into the pool of its technological know-how to get his country back on track towards an industrial breakthrough. An agreement was reached on Russian support in the construction of to build Egypt's first nuclear power station at Dabaa near the Mediterranean coast and the development of the country's uranium deposits. Moscow agreed to consider an Egyptian loan request - which one Moscow-based source had put at $2 billion - and that it might also increase grain supplies to Egypt if its harvest reached target level for 2013. Egypt has also offered Russia’s Gazprom, Lukoil and Novatek lucrative contracts to develop onshore and offshore oil and natural gas. BRICS countries are also very interested in having Egypt join the group as a representative of the Arab world. Egypt is the largest Arab state and has all the resources and opportunities to become the driving force for the economic development of the entire Arab region. The political events should not change the trend for economic diversification and progress which meets the interest of all Egyptians, no matter their political affiliations.