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High Cost Of Stability In Egypt

June 13, 2011 Ilan I. Berman Washington Times

Welcome to “The Hangover,” Cairo edition. The widespread grass-roots protests that broke out in Egypt this spring succeeded in accomplishing what many skeptics doubted they could: ousting long-serving strongman Hosni Mubarak and ending his 30-year authoritarian rule. But now, some four months on, Egypt’s revolution is obviously on the skids.

The problems start with Egypt’s economy. Under Mr. Mubarak, Egypt’s economic fortunes were comparatively rosy, with the national gross domestic product growing an average of nearly 6 percent annually over the past three years. Today, by contrast, they are anything but rosy. Since Mr. Mubarak’s ouster in February, the Egyptian stock exchange has lost nearly a quarter of its value, prompting its chairman, Mohamed Abdel Salam, to embark upon a frantic tour of Gulf monarchies in an effort to drum up Arab investment. Tourism, the lifeblood of the Egyptian economy, likewise has plummeted, falling an estimated 60 percent over 2010 levels and costing the country more than a half-billion dollars in revenue to date in the process. Nor is a reprieve in sight. According to observers, it could take a decade for Egypt’s tourism industry to rebound fully - if, indeed, it rebounds at all. The prognosis is grim: As a recent analysis in the Asia Times put it, “Egypt’s economy is in free-fall.”