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Spengler

Egypt descends into chaos

October 10th, 2011 - 2:30 am

Sunday’s massacre of protesting Copts is heartbreaking; from the initial reports, several thousand Christians marched to protest the military government’s blind eye towards Muslim violence when they were “were attacked by thugs carrying swords and clubs,” according to one Copt. The Egyptian government says that the Christian protesters began firing live ammunition at soldiers. That stretches credibility.

Meanwhile, according to today’s summary of the Egyptian press:

The state-owned [newspaper]  Al-Dostour reports on an “insane” increase in the prices of commodities and services that has left citizens “screaming,” presumably in despair. In its report, Al-Dostour claims that the “current state of lawlessness has left merchants and businesses with no supervision,” giving them free reign to raise prices without fear of repercussion. After a string of powerful metaphors depicting consumers as helpless prey in the grips of some fiercer yet unspecified predator, the report turns into an onslaught of numbers and percentages – food products up 80 percent since January of this year, LE7 for a kilo of sugar and LE13.75 for a liter of vegetable oil, 50 percent increase in the price of flour and LE22 for a kilo of duck meat, and on and on. LE9 for a kilo of humus, too.

No-one appears in charge. Central bank foreign exchange reserves are down to just $19 billion, or four months’ imports, the Financial Times reported last week. “After negotiating a loan from the International Monetary Fund, the military council decided to scrap it, partly on fears of popular criticism – the IMF has a negative reputation in Egypt because of its association with harsh structural adjustment programmes. In addition, only $500m of some $7bn of promised aid from Saudi Arabia and the United Arab Emirates have arrived so far.”

Egypt literally will run out of food. It imports half its caloric consumption, mainly wheat (although Egyptians eat less wheat than Iranians, Moroccans, Canadians, Turks and Russians). Egypt spends $5.5 billion a year on food subsidies. Its social solidarity minister wants to change the system (which subsidizes some people who can afford to pay more than the penny a loaf the government charges), but seems deeply confused. ”‘We need to change consumer habits so that we are not consuming so much bread. In Mexico, for example, they rely more on potatoes. Why can’t we start shifting toward that?’said Saad Nassar, adviser to the agriculture minister.” Mr. Nassar seems unaware that Mexicans eat more corn than wheat or potatoes. This discussion would be comical if not for the fact that Egypt is about to run out of money to pay for any sort of food.

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