Egypt has lost “at least $1bn” in tourism revenue as one million tourists have fled since protesters hit the streets, said Omar Suleiman, Egypt’s vice president, in a speech on Thursday (though it’s unlikely those figures have been audited). Separately, the OECD said that the government’s blocking of internet services for five days is “likely to have cost the country $90m”.

Meanwhile Vodafone, the UK telecoms company, was accused of sending out pro-Mubarak messages. It responded by saying the government had forced it to send out such messages without attribution. The FT’s latest story on developments is here.

Egypt is far from returning to normality – and whatever happens it will be a new normal rather than the old one. The authorities will face a daunting set of economic policy problems, including what to do with interest rates.

BNP Paribas is predicting the central bank will hike rates by 100 basis points at an emergency meeting this month in an effort to prevent supercharged inflation that could stir further social discontent. Continue reading »