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Monthly Archives: September 2012

Egypt’s Harsh Reality

By Farah Halime, editor of Rebel Economy 

Two days ago I stared hard in the face of the consequences of the neglect and deprivation arising from nearly 60 years of autocratic rule in Egypt.

I was threatened by a group of men with a six-inch blade and had a lit cigarette thrown at me.  It was because I’d splashed water in the face of a man who had been heckling me non-stop in traffic.

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Breakfast Wrap: Ugly Financial Decisions, Morsi In Turkey For 12 Hours

The bad, the worse and the ugly 

Nothing is pretty about revolution and nothing is tidy about the consequences.  For those countries that are battling with a post-revolutionary economic crisis, difficult decisions must be made that will not be accepted universally.

Tunisia’s budget deficit should narrow to 6% next year from 6.6% of gross domestic product (GDP) expected in 2012, the central bank governor said on Friday, indicating economic recovery in the cradle of Arab Spring revolts may take longer than anticipated.

“2014 will not be the year of recovery for the Tunisian economy. It is still a year of transition that may see the premise of recovery,” said Central bank governor Chadli Ayari indicating the country may not fully recover by 2014.

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Guest Post: From Tiananmen To Tahrir Square

Guest post by Douglas Johnson, a New York-based investment banker and Islamic finance specialist.  He is chief executive at investment banking firm Codexa Capital.  This post originally appeared in Codexa’s regular newsletter to investors.  

Tahrir Square may be closer to Tiananmen Square than a mapmaker would lead you to believe.

After the 1989 uprising in Beijing, Deng Xiaoping accelerated economic reform. The Chinese have never looked back; their worst annual GDP growth figure since 1990 was 7.6% in 1999.

Explaining China’s growth trajectory is more complicated, of course, than extrapolation from a single event. But one common theme throughout this period has been China’s anxiety over recurring civil unrest—actual and threatened.

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Breakfast Wrap: Islamists And Modernisation, Saudi Gas Troubles, Tunisia Soft Loan

Well, well, well.

One of Egypt’s biggest ultra-orthodox Islamist parties has signalled it would not oppose a loan to the government from the International Monetary Fund, even though Islamic law normally bans the paying of interest.

The ultra-orthodox Nour Party believes the government can take out such loans if there is no other option, Tarek Shaalan, head of its economic committee told Reuters.

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Khairat Al Shater And The President: A Divide

Khairat Al Shater, courtesy of Egypt Independent

It is Khairat Al Shater, and not the Supreme Guide Mohamed Badei, who has been seen as really running the Muslim Brotherhood behind the scenes.

The multi-millionaire, or The Engineer as he likes to called by friends, is regarded as the brains behind the group’s “Renaissance” or El Nahda project, and is among the most powerful members of the Islamist movement.

But a series of thinly veiled attacks by Mr Al Shater on the president suggest an increasing divide between the man who could have been president and Mohammed Morsi.

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Breakfast Wrap: Tunisian Mafia, Egypt’s $15 billion Energy Bill

“The revelations about these assets show the involvment of a Mafia with branches abroad,” said Tunisia’s minister for state property, Selim Ben Hmidane yesterday of the wealth of Tunisia’s deposed regime.

Tunisia’s ousted president Zine El Abidine Ben Ali apparently possessed more than $13 billion in assets, a government commission formed to look into his wealth has found,  Al Ahram quoted a Tunisian news agency as saying.

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Guest Post: The Revolt Against AUC’s Tuition Hike

Guest post by Mr X, a resident in Cairo 

The scenes of the blockade of the American University in Cairo by a group of students angry about proposed tuition hikes are hard to watch without cringing.

What should be a legitimate grievance aired by intelligent students is beginning to look like a mutation of the revolutionary spirit that helped bring down the regime of Hosni Mubarak into a hideous display of self-interest and disrespect for the majority of students and faculty who are now being prevented from entering campus.

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Breakfast Wrap: All Talk, No Action On Egypt Subsidies, Debt & Tourism Numbers

All talk an no action? That’s how Rebel Economy views any announcements on energy subsidies these days.  Promises have been made for years but the revolution put this inefficient in question because of the huge strain on the government budget.

But regimes under pressure from tough economic conditions and high oil prices have pulled back from existing subsidy cut plans or shied away from new ones for fear of angering their newly emboldened populations, energy insiders told me for this FT story I wrote recently.

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Guest Post: Egypt Developers Just Don’t Get It

Guest Post by Amira Salah-Ahmed, Cairo-based business reporter and co-founder of Egypt Monocle. She was a business editor at Daily News Egypt

At the height of the real estate sector boom in Egypt around 2008-9, low-income housing was all the rage.  Suddenly big players in real estate seemed to be turning their attention to the big gap in cheap housing.Panel discussions on low-income housing became a staple at five-star business conferences.

There was hope that real estate companies would stop obsessing over their upscale, exclusive developments geared to a fraction of the population and rich Arabs and foreign investors, and start focusing on what the market really needs.

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Breakfast Wrap: Why IMF loan alternatives lead to IMF, Egypt Central Bank Head to Retire

Egypt’s economy and the contentious International Monetary Fund loan were debated over the weekend in two pieces published in the The Guardian and Egypt Independent.  Both are worth reading and suggest that the IMF loan is not the most obvious solution to the nation’s economic woes.

There are alternatives on the table, both pieces argue.

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