Egypt's new age of unrest is a taste of things to come
Mass street protests are symptom of unsustainability of IMF model in the face of environmental and energy challenges
Nafeez Ahmed
An
alleged member of the Muslim Brotherhood is dragged through a crowd
of protester in Cairo, Egypt. Photograph: Ed Giles/Getty Images
4
July, 2013
Last
night's ousting of President Mohamed Morsi by the Egyptian army comes
as no surprise. Despite being Egypt's
first freely elected leader, his attempts to override
democratic checks and balances while
grabbing unilateral executive power fuelled widespread simmering
grievances. Although Adli Mansour, the new interim leader
sworn in today by the army, promises
to pave the way for new democratic elections, the fundamental drivers
of Egyptian rage remain overlooked.
Morsi's
key problem was that he had spent most of his energies on
consolidating the
reach of his party, the Muslim Brotherhood,
rather than dealing with Egypt's entrenched social, economic and
political problems. Indeed, Egyptian unrest is the consequence of a
fatal cocktail of structural failures rooted in an unsustainable
global model of industrial civilisation - addicted to fossil fuels,
wedded fanatically to casino capitalism, and convinced, ostrich-like,
that somehow technology alone will save us.
Egypt's
oil production peaked
in 1996,
and since then has declined by around 26%. Having moved from complete
food
self-sufficiency since the 1960s, to excessive dependence on imports
subsidised by oil revenues (now importing 75% of its wheat),
declining oil revenues have increasingly impacted food and fuel
subsidies. As high food prices are generally underpinned by high oil
prices - because energy accounts for over
a third of the costs of grain production
- this has further contributed to surging global food prices.
Food
price hikes have coincided with devastating climate
change
impacts in the form of extreme weather in key food-basket regions.
Since 2010, we have seen droughts and heat-waves in the US, Russia,
and China, leading to a dramatic fall in wheat yields, on which Egypt
is heavily dependent. The subsequent doubling
of global wheat prices
- from $157/metric tonne in June 2010 to $326/metric tonne in
February 2011 - directly affected millions of Egyptians, who already
spend
about 40%
of their income on food. That helped trigger the events that led to
the fall of Hosni Mubarak in 2011 - but the same configuration of
factors is worsening.
Egypt
has suffered from horrendous debt levels at about
80.5%
of its GDP, far higher than most other countries in the region.
Inequality is also high, widening
over the last decade in the wake of neoliberal 'structural
adjustment' reforms implemented throughout the region since the 1980s
with debilitating effects, including contraction of social welfare,
reduction of wages, and lack of infrastructure investment.
Not
learning the lesson of history, Morsi's economic plan was to
ingratiate
himself
as much as possible with the very institution, the International
Monetary Fund (IMF),
that had already played a central role in escalating the country's
economic woes.
Last
month, al-Ahram
reported that a combination of surging food prices, "weakening
Egyptian pound" and "energy shortages", had propelled
urban inflation to 8.1%. But inflation was also the result of an
austerity programme designed to meet IMF conditionalities before loan
approval:
"The
government, for its part, is adopting an economic programme that
involves a string of austerity measures that include reducing energy
subsidies that eat up a fifth of the country's budget, and raising
sales tax on select items to broaden the tax base. While unpopular by
nature, Egypt is pushing the measures to secure a $4.8 billion loan
from the International Monetary Fund (IMF)."
With
40% of Egyptians already below the UN poverty line of less than £2 a
day, Morsi's IMF-inspired policies amounted to a form of economic
warfare
on the Egyptian people. To make matters worse, as Egypt's economic
crisis made it harder to arrange payments, wheat
imports dropped sharply
- between 1 January and 20 February, the country bought around
259,043 tonnes, roughly a third of what it purchased in the same
period a year ago. Coupled with ongoing unemployment and poverty,
Morsi's Egypt was a time-bomb
waiting to explode.
Post-Morsi,
Egypt still faces the same challenges, which have worsened under the
Brotherhood's mismanagement. In the long term, the country also faces
a growing demographic crisis. Currently at 84 million, the population
is projected to increase to an estimated 100 million after about a
decade.
In
this sense, Egypt is in some ways a microcosm of our global
challenges. With the age of cheap oil well and truly behind us, an
age of climate extremes and population growth ahead, we should expect
increasing food prices for the foreseeable future. This in turn will
have consequences. For the last few years, the food
price index
has fluctuated above the critical
threshold
for probability of civil unrest.
Unless
Egypt's leaders and activists begin taking stock of the convergence
of crises unraveling the social fabric, their country faces a
permanent future of intensifying turmoil.
And
that lesson, in a world facing rising food, water and energy
challenges, is one no government can afford to ignore.
Dr
Nafeez Ahmed
is executive director of the Institute
for Policy Research & Development
and author of A
User's Guide to the Crisis of Civilisation: And How to Save It
among other books. Follow him on Twitter @nafeezahmed
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