Last night’s ousting of President Mohamed Morsi by the Egyptian army comes as no surprise. Despite being Egypt’s first freely elected leader, his attempts to override democratic checks and balances while grabbing unilateral executive power fuelled widespread simmering grievances. Although Adli Mansour, the new interim leader sworn in today by the army, promises to pave the way for new democratic elections, the fundamental drivers of Egyptian rage remain overlooked.
Morsi’s key problem was that he had spent most of his energies on consolidating the reach of his party, the Muslim Brotherhood, rather than dealing with Egypt’s entrenched social, economic and political problems. Indeed, Egyptian unrest is the consequence of a fatal cocktail of structural failures rooted in an unsustainable global model of industrial civilisation – addicted to fossil fuels, wedded fanatically to casino capitalism, and convinced, ostrich-like, that somehow technology alone will save us.
Egypt’s oil production peaked in 1996, and since then has declined by around 26%. Having moved from complete food self-sufficiency since the 1960s, to excessive dependence on imports subsidised by oil revenues (now importing 75% of its wheat), declining oil revenues have increasingly impacted food and fuel subsidies. As high food prices are generally underpinned by high oil prices – because energy accounts for over a third of the costs of grain production – this has further contributed to surging global food prices.
Food price hikes have coincided with devastating climate change impacts in the form of extreme weather in key food-basket regions. Since 2010, we have seen droughts and heat-waves in the US, Russia, and China, leading to a dramatic fall in wheat yields, on which Egypt is heavily dependent. The subsequent doubling of global wheat prices – from $157/metric tonne in June 2010 to $326/metric tonne in February 2011 – directly affected millions of Egyptians, who already spend about 40% of their income on food. That helped trigger the events that led to the fall of Hosni Mubarak in 2011 – but the same configuration of factors is worsening.
Egypt has suffered from horrendous debt levels at about 80.5% of its GDP, far higher than most other countries in the region. Inequality is also high, widening over the last decade in the wake of neoliberal ‘structural adjustment’ reforms implemented throughout the region since the 1980s with debilitating effects, including contraction of social welfare, reduction of wages, and lack of infrastructure investment.
Not learning the lesson of history, Morsi’s economic plan was to ingratiate himself as much as possible with the very institution, the International Monetary Fund (IMF), that had already played a central role in escalating the country’s economic woes.
Last month, al-Ahram reported that a combination of surging food prices, “weakening Egyptian pound” and “energy shortages”, had propelled urban inflation to 8.1%. But inflation was also the result of an austerity programme designed to meet IMF conditionalities before loan approval:
“The government, for its part, is adopting an economic programme that involves a string of austerity measures that include reducing energy subsidies that eat up a fifth of the country’s budget, and raising sales tax on select items to broaden the tax base. While unpopular by nature, Egypt is pushing the measures to secure a $4.8 billion loan from the International Monetary Fund (IMF).”
With 40% of Egyptians already below the UN poverty line of less than £2 a day, Morsi’s IMF-inspired policies amounted to a form of economic warfare on the Egyptian people. To make matters worse, as Egypt’s economic crisis made it harder to arrange payments, wheat imports dropped sharply – between 1 January and 20 February, the country bought around 259,043 tonnes, roughly a third of what it purchased in the same period a year ago. Coupled with ongoing unemployment and poverty, Morsi’s Egypt was a time-bomb waiting to explode.
Post-Morsi, Egypt still faces the same challenges, which have worsened under the Brotherhood’s mismanagement. In the long term, the country also faces a growing demographic crisis. Currently at 84 million, the population is projected to increase to an estimated 100 million after about a decade.
In this sense, Egypt is in some ways a microcosm of our global challenges. With the age of cheap oil well and truly behind us, an age of climate extremes and population growth ahead, we should expect increasing food prices for the foreseeable future. This in turn will have consequences. For the last few years, the food price index has fluctuated above the critical threshold for probability of civil unrest.
Unless Egypt’s leaders and activists begin taking stock of the convergence of crises unraveling the social fabric, their country faces a permanent future of intensifying turmoil.
And that lesson, in a world facing rising food, water and energy challenges, is one no government can afford to ignore.
Dr Nafeez Ahmed is executive director of the Institute for Policy Research & Development and author of A User’s Guide to the Crisis of Civilisation: And How to Save It among other books. Follow him on Twitter @nafeezahmed
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