That’s a question I put to around a dozen Egyptian businessmen over the weekend, all of whom responded with a resounding “Yes”.
Here’s some snippets of conversations I had with a few of Egypt’s business community over the weekend (some appeared in this story for The National newspaper):
Nassef Sawiris, billionaire and head of Egypt’s biggest listed company, Orascom Construction Industries: The previous government had lost all economic ties with the majority of Arab Gulf governments and tourism has suffered tremendously because of conflicting messages [from the former Islamist administration]. This one of the biggest failures and resulted in a decline in foreign reserves. I hope the new government will be inclusive to all Egyptian political sectors.
Mahmoud Abul Eyoun, former governor of Egypt’s Central Bank: I’m very optimistic. We need a government to set the priorities for solving the internal and external imbalances. Rebulding the confidence among the Egyptian business comminity will create momentum for attracting foreign direct investment and portfolio investment.
Alaa Arafa, chairman of Egyptian clothing conglomerate Arafa Holding: The economic situation will take at least 6 months after the violence stop to show some signs of improvement. Everybody is ready to pay the price of freedom. The army is a great support to the people.
Mohammed Badra, board director at Banque Du Caire (Egypt’s third largest commercial bank): All of us are very happy, because at least we can see a light at the end of the tunnel. I think the army will guard the implementation of the road-map. We are hoping the security situation will improve and tourism returns so that we can have an improvement in the [credit] rating of the country.
For many businessmen, the military-backed political transition gives the country its best opportunity since 2011 to create a technocratic administration that has the expertise to tackle Egypt’s economic problems and lure back investors.
This says more about the failures of former president Mohammed Morsi, who was widely accused of doing nothing to prevent a looming economic collapse, than support for the military.
Still, the unwavering optimism that the military’s actions were good for Egypt’s economy, was astonishing (especially in light of the divisive atmosphere today as a result of the tragic killing of 42 Egyptians).
The early signs look promising: the stock exchange made its biggest gains all year, rising 7.3%, the long queues for fuel seemed to have miraculously disappeared, and the hope that an economist (now slated as London School of Economics-educated Ziad Bahaa El Din) would be made prime minister shook off any doubt that the army was overreaching its role.
In fact, the stock market rose only because of positive sentiment from local traders, while foreign investors sold heavily. Meanwhile, Egypt’s fuel crisis has not gone away and remains a genuine problem, but the panic that drove thousands to fill their tanks has subsided. And the business community is still holding its breath and counting on the army to keep to their strict six- to eight-month timeline for a handover to a civilian government.
It’s unclear who is calling the shots here and uncertainty is no good for business.
The only silver-lining to the removal of Morsi is that negotiations with the International Monetary Fund had hit a stumbling block and perhaps, with the Muslim Brotherhood’s political arm, the Freedom and Justice Party out of the way, some progress can be made.
Over all however, Egypt’s economic outlook is much worse than it was a week ago. Credit ratings agency Fitch became the latest to downgrade Egypt, saying political tensions are likely to set back the country’s economic recovery.
Egypt is unlikely to exceed growth of 3% next year, analysts at Fitch say.
It is baffling to see so many high profile businessmen and women describe what is happening as a positive for the country. The military merely seized on an opportunity to overthrow an elected president in a coup (yes, some of you disagree, don’t shoot me) which has created more division than any time under Mohammed Morsi.