‘Catastrophic’ it is!

Rana Allam
9 Min Read
Rana Allam
Rana Allam
Rana Allam

Amnesty International said last week that Egypt is witnessing a “catastrophic” decline in human rights. Indeed, human rights conditions in Egypt are currently a disaster, but the “catastrophe” Egyptians are witnessing these days is all-encompassing.

On Friday, the government announced an increase in fuel prices – a step every government has struggled to take and none could, for fear of public rage. Al Sisi’s government can, however – just as they can send hundreds of people to death without proper evidence, imprison journalists on bogus charges, and detain tens of thousands in a few months.

The problem with raising fuel prices in Egypt and cutting subsidies is, quite simply, that the government is targeting the poor with the increase without providing any alternatives. No one can argue that the increase isn’t needed, and fuel in Egypt is very cheap relative to any other country. But “any other country” also has proper public transportation; cars in Egypt are not a luxury, but a necessity. Anyone who has visited Egypt knows this very well; you cannot use public transportation if you want to keep your dignity and your sanity. Egyptians pay an average of 200% customs on cars they buy, and they accept that only because they have no choice!

How is this increase targeting the poor? Just a quick look on the percentages of increase tells all: a 78% increase in mainstream fuel used for transportation (people and goods) and only a 7% increase for Octane 95 used for high-end cars. Octane 92, used mostly by the middle class, increased 44%.

On top of that, a 64% increase in diesel fuel, used mostly in the processes of production (specially agriculture products) means that production, transportation and storage costs of food products will be greatly affected.

Add to that the 30% increase in electricity prices, and the 30 to 75% increase in natural gas for some industries like cement, iron and steel, and you will get price hikes like never before. These increases, when not coupled with measures to increase the citizens’ income, and with an over 13% unemployment rate and 25% poverty rate, are disastrous. Not only is there no increase in income, there is actually a decline, given that most employers are decreasing salaries, laying off people, or simply closing down. Put this altogether, and we don’t just have a problem on our hands – we have a crisis.

The Consumer Protection Agency said the increase in electricity and fuel prices will result in a 200% increase on all products, while some experts say that food in particular will increase by at least 20%. Yet following some logic unknown to the public, the prime minister said on Friday that “fuel prices will not affect food products”. How this is possible, however, he did not say.

Consider this: in May 2013, the UN World Food Programme (WFP) along with CAPMAS issued a report based on the CAPMAS 2011 Household Income and Expenditure and Consumption Survey (HIECS). The report stated that “an estimated 13.7 million Egyptians or 17% of the population suffered from food insecurity in 2011”and that “twice as many people moved into poverty as moved out, with less money to spend on food”. Imagine, then, what will happen now!

According to the economist DNE interviewed today, there exists a category just below the middle class that accounts for 20% of the population, and this price increase has impoverished members of this class while simultaneously dragging the middle class to just above the poverty line. Originally, Egypt’s poor represent 25% of the population, with the rich making up 10%, the middle class 45%, and those “just below the middle class making up the remaining 20%”. These percentages will now change, dragging millions to poverty, and millions more to just above it.

No measures are being taken to alleviate the financial status of the citizens, be they poor or middle class. In fact, many Egyptians would now move to the “poor” category, given the increase in their cost of living. Egypt has 25% poverty rate, but it’s worth noting that even this percentage does not include those holding permanent jobs, millions of whom have been struggling to receive a minimum wage of EGP1,200 for years now, without success. Meanwhile, as per 2013 numbers, a family needs a minimum income of EGP 1,620 to fulfill its basic needs. Are these not considered poor? And how much would they need now to simply buy food?

The cherry on top of all this is that the prices of electricity and water are increasing, yet the power outages and water outages are an everyday problem for almost all Egyptians… or at least for those who can’t afford to build solar panels and buy water generators for their villas.

Al-Sisi said in an interview before his election: “We cannot decrease subsides because the Egyptian citizen cannot afford it. We need to increase income by 50 to 100% before we can decrease subsidies.” Today it seems this has changed somehow!

Most of us, Egyptians, understand the need to cut subsidies but we also believe that the government should not deal with this in isolation of other measures. Social justice guarantees, opening the market and revisiting customs, restructuring of the economic system, end the corruption that costs us billions of pounds, and above all improve government services. Without giving the people any services in healthcare, education, security and a proper implementation of social justice, subsidies cuts are unacceptable.

For many Egyptians, the story is the same every day: wake up in the morning to find no water and no electricity, leave the house to get to work (if he is lucky to have a job to begin with), get into an undignified and completely chaotic transportation, get stuck in horrendous traffic, suffer from a 40% increase in his transportation cost, a 20% increase in the cost of food, a 30% increase in  his electricity and natural gas bills, get paid in peanuts –  and all this while risking death in a traffic accident (from which 20 people die every day).

If this man thinks about objecting in any manner, even a small sticker or joining a peaceful protest, he risks being arrested and tortured in detention facilities, or facing trail and getting a 15 year in prison sentence. Or maybe he would be charged with belonging to a terrorist group, get life in prison or a death sentence, depending on what happens on the day he protested.

With these kinds of everyday catastrophes becoming endemic, it’s no wonder we see strikes, protests and violence  in the news every morning!


Rana Allam is the Editor-in-Chief of the Daily News Egypt. Follow her on Twitter at @Run_Rana or email at [email protected]


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