Yesterday afternoon I found myself crossing the increasingly bedraggled expanse of Tahrir Square (where a permanent encampment of protesters has lived since last month's confrontation with Morsi and where a mild Mad Max vibe now prevails) to go hear about how the Egyptian ecomony is doomed.
At a media roundtable on the Egyptian economy at the American Univerity in Cairo's downtown campus, professors from the university predicted that the pound will fall to 7LE to the dollar; that growth will be no more than 2% of GDP; that foreign and domestic investment will remain low (private investment is currently 16% of GDP, whereas to promote growth it should be at 20-25%) and that inflation and social tension will rise.
The economic policies of the current government were treated with ridicule -- starting with a recent announcement that they will create 800,000 jobs this year (most jobs "created" since the revolution by the government have meant giving permanent posts to functionaries on temporary contracts -- and we all know how the Egyptian bureaucracy needs to be strenghtened) and ending with their promise that new Sharia-compliant Islamic bonds will raise $200 million. Economics professor and disgruntled social observer Galal Amin, in particular, eschewed economic jargon and tore into the situation with refreshing candor and avuncular charm. "I don't see why we even need to have conferences to discuss fixing the economy, guys" he said, "when they can raise $200 million by creating a new kind of bond."
According to Amin -- although the economy wasn' t great before the revolution -- the basis of Egypt's economic crisis is political, caused by "a lack of security and a lack of trust," which the prevailing political discourse does not help. Investors, Christians, tourists -- none of them are confident in Egypt anymore. And the Islamist government obfuscates. "They don't just not tell the truth," about the economy, he said. "They say the opposite of the truth."