Egypt’s Economy Sinks on Heels of Uprising
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Full Transcript of Segment:
Margaret Warner: “And so there is a deep sense, really, of injustice here that is very longstanding. And, in fact, it was part of what helped fuel the revolution. A recent poll by the International Republican Institute, when people who participated were asked, what drove you, about 80 percent said it was really unhappiness with their economic prospects, rather than unhappiness with the pace of democratic reform.”
JUDY WOODRUFF: And we turn again to Egypt.
Margaret Warner continues her reporting from Cairo with a look at the economic fallout from the revolution.
MARGARET WARNER: After 30 years driving a taxi from upscale hotels through the streets of Cairo, Sayed Swidan’s fares come few and far between these days.
SAYED SWIDAN, driver: My work very bad now.
MARGARET WARNER: The revolution that toppled Hosni Mubarak has kicked off a political transformation. But for men like Swidan, this upheaval has brought a stifling economic slowdown, especially to the country’s lifeblood: tourism.
SAYED SWIDAN: Not a lot of tourists come this year, because after demonstration, no good job for me. All Egyptian people, very good for them, not me.
MARGARET WARNER: And not for millions of other Egyptians who’ve seen their bottom line falling as prices rise. Tourism generates one in seven jobs here and 11 percent of the gross domestic product. But this year, international arrivals and the revenue they produce are down by nearly half.
Other gloomy indicators abound: stock market down 35 percent this year; inflation projected to rise by double digits; growth, anemic. The streets of Giza should be teeming with tourists early on a Friday morning. But, today, the camel drivers and horsemen sat idle.
SAYED SWIDAN (through translator): Normally, this place is so filled that it’s uncomfortable to stand because the huge crowd of people here, foreigners, Egyptians. But ever since the revolution, the livelihoods of the people who work here have been brought to a halt.
MARGARET WARNER: Khaled Sayed Ahmed runs sporting stables nearby. He used to pull in about 1,500 Egyptian pounds per day, about 300 U.S. dollars. Now his ships of the desert lie deserted, and many of the men who once drove them are gone.
KHALED SAYED AHMED, Egypt (through translator): These men aren’t only responsible for themselves. Behind them are workers, then camels and horses, and of course their families to feed and provide for. And no one’s helping us.
MARGARET WARNER: Just up the street, Mahmoud Said opens an empty gallery. Papyrus artwork here sells from $20 to $2,000.
MAHMOUD SAID, gallery employee: We have just two, three customers, not more. Before, we have like 20 customers, 15 every day. You can work, not sleep. But right now we can sleep any times.
MARGARET WARNER: It is a commanding view from the roof of his gallery, but Mahmoud says, as bad as times are now, things may get still worse.
MAHMOUD SAID: We hope the tourists come back because we have horses’ leavings, horses dying and camels. Also, is no food.
MARGARET WARNER: For Sayed Swidan, the tumult is hitting not only him, but his children. He worked seven days a week for decades to send them to private school and university. Sayed’s 26-year-old son, Tamer (ph), who graduated with an accounting degree does have a job, taxi driver. Neither father nor son blame the revolution for their lot. They do blame a system that hasn’t changed enough yet.
JEFFREY BROWN: Ray Suarez talked with Margaret earlier today after she filed that report.
RAY SUAREZ: Hi, Margaret.
MARGARET WARNER: Hey, Ray.
RAY SUAREZ: Egypt is a place with a fast-growing population and often a slow-growing economy. Wasn’t there economic dissatisfaction long before the fall of Mubarak?
MARGARET WARNER: There certainly was, Ray.
Two-thirds of Egyptians are under the age of 30. And it’s estimated that a third of them don’t have jobs. And a lot of them are university graduates. This is not new. In fact, the driver Sayed who is in our piece told me that when his son graduated from Cairo University with an accounting degree, he said, “If he have friends in Mubarak office, he get job tomorrow. No friends, no job.”
And so there is a deep sense, really, of injustice here that is very longstanding. And, in fact, it was part of what helped fuel the revolution. A recent poll by the International Republican Institute, when people who participated were asked, what drove you, about 80 percent said it was really unhappiness with their economic prospects, rather than unhappiness with the pace of democratic reform.
So what is bothering people here now, though, is that absolutely nothing appears to have changed, and, in fact, it seems to have gotten worse.
RAY SUAREZ: Well, after the struggle against the Mubarak government, are more Egyptians having second thoughts about whether it was all worth it, kind of revolutionary buyer’s remorse? And if people are unhappy, who do they blame for how things are going?
MARGARET WARNER: Ray, we haven’t had anyone say to us, we wish Mubarak were back. But they are very unhappy with what has come after Mubarak.
As earlier pieces of mine have shown, people thought — many people thought there would be faster change. Instead, what they have got is a complete stalemate, uncertainty about where the country is going, and less security. I mean, one thing a police state can guarantee is security when you walk in the streets. People don’t feel quite that same sense of security anymore.
Now, in terms of blaming about the economic situation, you put your finger on a really hot political issue. In the state media, the military government, the cabinet are blaming the revolution for the bad state of the economy. And when we were at the Tahrir Square, a protest rally, last Friday, that infuriated the young activists there.
We talked to one young couple, highly educated, both underemployed, and they said, that’s ridiculous. The reason foreign investment in Egypt is drying up right now is because, who wants to invest in a country in which you don’t know who is going to be running the government, what kind of government it will be in six months?
Finally, Ray, there is another factor that just developed the past week, and that is, of course, the attack on the Israel Embassy. In the last five days, the stock market has been down absolutely every day. And according to the Egyptian media, this is non-Arab investors pulling their money out, because what it conveyed was a general sense of lawlessness here, which may be a slight exaggeration, but not reassuring to anyone who is thinking of investing in this country.
RAY SUAREZ: I’m glad you brought that up, because in that same stretch of days, the president of Turkey, Recep Tayyip Erdogan, was in Egypt. Is the political map of the Eastern Mediterranean now being redrawn? Is Egypt moving toward Turkey and away from Israel?
MARGARET WARNER: I am not sure I would equate Israel and Turkey in terms of Egypt’s relationship with them, because, as we all know, I mean, the relationship with Israel, the peace accord, it was really an accord of necessity, a very cold piece, as the cliché goes.
Basically, it kept both countries from feeling they risk going to war. Egypt’s relationship with Turkey is quite different. I mean, Turkey is seen as a very successful country here, the most successful Muslim-majority state certainly in the region.
And when Erdogan came this week, he was treated like a rock star. Literally, people were waving for him in the streets. He got huge crowds at all of his events. And I think you are definitely going to see greater, if not coordination — cooperation, then coordination between the two on many issues involving the Eastern Mediterranean, but also the world, for example, next week’s vote in the U.N., or at least the introduction of the issue, on Palestinian statehood.
Finally, Ray, yesterday, in a real stunner, the transitional prime minister of Egypt — now, he is just of the transitional government — but came out and said that the Camp David accord was — quote — “not a sacred thing” and could be, should be discussed, and might have to be, I don’t know if he used the word renegotiated, but looked at in terms of what was best for the peace and security of the region.
Now, up until now, the transitional government, all the political players have been saying, the Camp David accord stands. And the fact that so soon after the Israel Embassy attack, he came forward and said that said to observers here, they have to listen to the Egyptian street.
And when we have talked to various political parties here, all of them have said, well, we want to retain the Camp David agreement; some of the side agreements will have to be renegotiated. For example, Egypt sells Israel 40 percent of its natural gas.
So, all of this combines, Ray, I think, to make Israel’s at least sense of political security in this region less secure than it was just two months ago.
RAY SUAREZ: Margaret, thanks a lot. Good to talk to you.
MARGARET WARNER: Thank you, Ray.
JEFFREY BROWN: When Margaret returns next week, we will have her interview with novelist and activist Alaa al-Aswany for his perspective on the uprising and the post-Mubarak era.Top