On the day of the Paris terror attacks US Secretary of State John Kerry visited Tunisia, five years after the Arab Spring erupted and months after Tunisia’s own Isis assaults on prominent tourist sites. Kerry pledged additional security and economic support as the US Congress considers a package doubling it to $135bn next year, and hailed the country’s political transition that earned those in charge the Nobel Peace Prize.
However, one in three members of the Nidaa Tounes party in Tunisia’s ruling coalition resigned before Kerry’s arrival to protest continued corruption and economic stagnation, and development initiatives were largely confined to another sovereign bond guarantee and backing for IMF, World Bank and other assistance programmes in place for several years with mixed results. Although Washington is willing to underwrite commercial debt, it could go much further in promoting local financial market development, in particular in partnership with private sector banks and fund managers who have been absent, as a wholesale rethink of post-Arab Spring aid for Tunisia and its neighbours is long overdue. Read more
After 100 days in power, Egypt’s president Abdel Fattah al-Sisi has been given a cautious thumbs up by economists.
Al-Sisi, a former defence minister, won a landslide victory in Egypt’s presidential race on May 24, almost a year after he led the coup that ousted Mohammed Morsi, the elected Islamist president, from power. Political turbulence has been bruising for Egypt’s economy, which by most measures is in a worse state than it was before the advent of the Arab Spring in 2011. Read more
What will the EMs next “black swan” be? With the crash of the Argentinian peso, the difficult Syrian peace talks in Montreux, and Iran’s nuclear situation, WEF participants last week had enough scenario’s to reflect on. But one fear of Davos participants about emerging markets was a rather unexpected one: the EM middle class.
Nouriel Roubini, in the CNN debate on Emerging Markets, was quick to point it out. “Paradoxically, it’s not the proletarians that are in the street in countries like Brazil, Chile, India, or Ukraine,” he said. “It’s the middle class. They’re becoming restless.” Read more
A three-week teachers’ strike in Oman suggests that the genie of unrest is out of the bottle in this unassuming corner of the oil-rich Gulf.
The strike has affected up to three quarters of Oman’s roughly 1,000 schools, where open dissent is becoming a regular occurrence since the strategic sultanate had its own outburst of Arab spring-inspired unrest in March 2011. Read more
It'll cost you
Commenting on the Russian revolution, Joseph Stalin is alleged to have said, “You can’t make an omelette without breaking a few eggs.” What then is the price of eggs?
HSBC has totted up the lost output of seven states most hit by the Arab Spring, and estimates a loss of $800bn by the end of 2014. Read more
By Jean-Pierre Lehmann of IMD
Many of us are unlikely to mourn the departure of Mohamed Morsi from Egypt’s presidency. Though to some his forced exit may appear a blow to democracy, to others it heralds the termination of what was becoming a fundamentalist Islamist regime. Egypt, it seems, will not become another Iran – or at least not immediately.
But it is fair to ask: what on earth is going on in the Arab world? It is going in the opposite direction to much of the planet. Read more
The world’s emerging markets are in the grip of an unprecedented wave of public protest. Today it’s Brazil. A few days ago it was Turkey. Before that there were Russia, Indonesia, India, and South Africa, all of which have seen big demonstrations in the past year. And before that there was Egypt and the Arab Spring. Read more
By Dalibor Rohac of the Cato Institute
Egypt is facing its deepest political crisis since February 2011. On Sunday, the Supreme Constitutional Court ruled that both the election to the Shura council, the country’s upper house, and the appointment of a panel charged with drafting the new constitution were unconstitutional. Although no one can predict the exact reverberations of these decisions, they are a reminder of the threat dysfunctional politics represents to the future of the Arab world. Read more
An Egyptian proverb says, “when the merchant goes bust, he starts searching through his old books,” in the hope, of course, of finding a debt or two that he can call in. To many Egyptians, their government is acting like the proverbial merchant as it aggressively pursues, over a tax claim suddenly conjured out of history, two of the country’s biggest businessmen, Nassef Sawiris (pictured), chairman of Orascom Construction Industries, and his father, Onsi Sawiris, former chairman.
If successful, the government could net a few much-needed billions. But to many critics, the action against OCI could seriously damage the prospects of restoring investor confidence in the country. Read more
Inflation is on the rise in the Middle East and north Africa, bringing risks to consumption-driven growth and adding to political strains in the transitional countries least able to cope with them. Read more
Had its good intentions been realised, the Arab spring would have been a magnet for foreign direct investment. Sadly, the instability that has followed the ousting of some of the region’s most notorious dictators has had the opposite effect, scaring away new entrants and making many foreign businesses with a foothold put their expansion plans on hold.
Which makes the news that BIM, a Turkish discount supermarket giant, is planning a rapid expansion into Egypt all the more significant. Read more
The Arab spring seems a world away on the train from Casablana to Rabat. In one compartment a conversation springs up between a local Moroccan, running a machine parts manufacturing business, and a Saudi from a construction company, visiting Rabat to seek migrant labour to help with the booming development in Saudi’s northwest. Cards are exchanged, then brochures; business is done, right here on the rumbling train. Read more
The latest official figures show that unemployment in Egypt has risen to 13 per cent in the last quarter of 2012, up from 12.5 per cent in the third quarter, writes Heba Saleh.
This translates into a loss of 162,000 jobs across the economy. In comparison, unemployment on the eve of the 2011 revolt, which toppled Hosni Mubarak as president, was 8.9 per cent according to the government statistics agency.
But the official figures tell only part of the story. Read more
Two years on, and Egypt is back in crisis. Mohamed Morsi, Egypt’s Islamist president, announced a month-long state of emergency on Sunday following violence in which nearly 50 have died.
For anyone hoping for a turnaround in Egypt’s economic fortunes, it’s another big blow and one that may hurt chances of a deal with the IMF. Read more
“Don’t be afraid of the Middle East.” That, in short, is the message of private equity investor Mustafa Abdel-Wadood at the World Economic Forum in Davos this week.
“Despite the headlines, there are a lot opportunities in the region,” Abdel-Wadood, whose Abraaj Group has $7.5bn EM assets under management, told beyondbrics. “It comes with challenges, and the perception may not always be positive, but our investments have done well.” Read more
The last in our series of posts by outside commentators on prospects for emerging markets in 2013 is by Mark Mobius of Templeton Emerging Markets
On my most recent trip to Egypt in early December, I arrived in Cairo a few days after President Mohamed Morsi announced that he was assuming dictatorial powers over the writing of the new Egyptian constitution.
However, during our company visits, we found that, surprisingly, it was business as usual in Egypt. Read more
January 2013 will mark the two year anniversary of the Egyptian uprisings which overthrew Hosni Mubarak. Amid the optimism which followed the transition to democracy, few serious analysts expected the path ahead for the country to be smooth, and indeed it has not been. An FT special report on Egypt highlights the challenges faced by the Arab world’s largest democracy. Read more
Egyptian equities jumped 4.4 per cent on Sunday after president Mohamed Morsi rescinded the controversial decree in which he extended his powers and plunged the country into a new wave of protests.
Investors clearly hope that Morsi has done sufficient to restore enough stability for the International Monetary Fund to implement its crucial planned $4.8bn loan. But has he? The opposition doesn’t think so – it is still demanding a delay on the planned December 15 constitutional referendum. Watch out for more seesawing in the markets, as the Islamists and the opposition fight it out. Read more