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Egypt to diversify its economic strengths

The Cabinet reshuffle that took place in Egypt recently was an inevitable result following a failure in dealing with important economic issues, and the effect of that on the people's dissatisfaction during the last ten months.

Egypt is in a crisscross as it faces challenges in the form of economic difficulties and continuous terrorist attacks.
There is also the enlarging gap between public revenues and expenses, which risks increasing Egypt's budget deficit and inflation, leading to inflation.
The Cabinet reshuffle that took place in Egypt recently was an inevitable result following a failure in dealing with important economic issues, and the effect of that on the people's dissatisfaction during the last ten months.
Moreover, trade deficit went up and the imports increased by roughly 40 per cent to reach $70 billion, while exports fell to less than $30 billion. This had coincided with the inability to implement all the ambitious projects agreed upon during the Egypt Economic Development Conference (EEDC).
Remittances from Egyptians living abroad, which is the main source of foreign currency, also dwindled and contributed to the rise of a powerful black market of hard. Rising budget deficit was also a problem that the Ministry of Finance couldn't solve. During the last few months, Egypt also faced a number of economic crises that resulted from the Russian plane air crash in Sharm El Sheikh. Due to which it saw 80 per cent decrease in the flow of tourists and the subsequent fall in income from this vital sector. Officials in the ministry of tourism were not able to help the sector overcome such circumstances, and the minister was ultimately axed.
A ministry for public business sector was created to help the government provide the local market with the needed products, as well as export to the outside markets as part of the efforts being spent to control the rising prices of commodities and the falling amount of exports.
Egypt's bet on its success in overcoming economic hurdles is coincided with a clear change in its political moves during the last few months, and that change can be witnessed on three main levels. First was developing self-abilities without waiting for the United States or the European Union to fully understand the true political situation of June 30, 2014, especially the ouster of Muslim Brotherhood government.
The second was strengthening of ties with the Arab countries, especially the United Arab Emirates, the Kingdom of Saudi Arabia and Kuwait, and start a range of projects that attract investors and funds from these states. That followed a series of grants, amid dwindling income. The third one is evident in other political moves towards establishing good relations with major Asian powers like China, Japan, South Korea and Singapore, in addition to making relations with Russia more important than that with the USA.
The previous three levels represent a roadmap to overcome Egypt's economic crisis, and they send a message to the European Union and the US that reflects the diminishing confidence of Egyptians in a correction of their policy towards Egypt or have an intention to create an economic partnership that helps Cairo rebuild its economy amid its fight against terrorism.
I could say here that the European intransigence in continuing flight restrictions to Egypt, as well as the American administration's comments on human rights in Egypt, have made officials and citizens of Egypt more convinced to not depend mainly on these countries, and that the coming period requires building on the three levels mentioned above.
The Egyptian orientation reflects a philosophy similar to that applied by the East Asian nations that depended on their own resources and strengths to achieve their economic renaissance away from the major industrial countries. Thus, the next few months might witness a number of mega projects to be kicked off by Egypt in order to attract mainly Gulf and Asian investments, aiming to achieve a better economic growth rate, generate job opportunities for youths and curb rising prices.
The writer is the managing editor of Al Ahram Al Massai