Egypt Struggles with Economic Problems Intensified by Ukraine War

Egypt Struggles with Economic Problems Intensified¹ by Ukraine War

Egypt is in an economic crisis made more severe by Russia's invasion of Ukraine. The conflict, now in its second year, has increased food and energy prices.

High inflation, the low exchange value of Egyptian money and unpopular government policies all add to Egypt's problems.

The crisis has pushed many Egyptians out of the middle class. The country's poor — about one-third of the population — are cutting back on basic goods. Many are asking how long they can survive like this.

Hany Hassan has found himself struggling to feed his four young children. Pay from his job at a cafe is buying less and less.

Hassan, who is 43 years old, earns about $110 a month working 12 hours a day seven days a week. "I am scared that one day I won't be able to feed the kids," he said.

Yearly inflation reached 26.5 percent in January, the highest rate in five years. Food prices in urban areas have increased 48 percent.

Many important goods like rice, cooking oil, bread and most recently, eggs, have all doubled in cost in Cairo's supermarkets. The prices of chicken and other meat have almost doubled from a year ago.

The war in Ukraine hit Egypt where it is financially weak. The most populous² Arab country and world's biggest importer of wheat needs to buy most of its food from other countries.

Egypt's import costs first increased because of higher world prices for things like fuel and wheat that are purchased in dollars. This led to foreign currency shortages, said Callee Davis, an economist³ at Oxford⁴ Economics Africa, a business advisory⁵ company based in Britain.

The low exchange value of Egypt's money forced the Central Bank of Egypt to pass policies to preserve the country's foreign reserves. The policies included restrictions⁶ on imports. That drove inflation even higher, Davis said.

For many Egyptians, difficulties began in 2016 when President Abdel Fattah el-Sissi's government started a reform program. The program aimed to reform Egypt's economy in return for loans from the International Monetary⁷ Fund (IMF). The program introduced new taxes and included large cuts in state subsidies⁸ for basic goods.

Western governments and international financial institutions supported the spending cuts. However, they have made life difficult for many Egyptians. El-Sissi has blamed the war in Ukraine for the most recent inflation.

To help poor and middle-class families, the government increased social welfare programs and raised pay for government workers. It also delayed cuts to subsidized bread and planned electricity price increases. The government also created hundreds of government-owned markets that sell basic goods for low prices.

The government received a new loan from the IMF last year, the fourth in six years. The hope is that the $3 billion deal will help Egypt's international and regional partners provide another $14 billion. Possible lenders include wealthy Gulf⁹ countries.

But Gulf Arab states seem increasingly unwilling¹⁰ to help Egypt as they have over the past 10 years.

"We want to help, but we want you also to do your part," said Saudi Finance Minister Mohammed al-Jadaan at the World Economic Forum¹¹ in January.

Egypt has promised to keep the IMF-guided reforms. Those include an exchange rate set by foreign exchange markets and lessening¹² the military's hold on the economy.

But Egyptian leaders are facing criticism for their handling of the economy. They have created costly¹³ infrastructure¹⁴ projects, like a new $45 billion capital building, other developments and highways. The government has defended the projects as important for improving living conditions. It also says the projects create jobs for the growing population.

H. A. Hellyer is a political expert at the Royal United Service Institute for Defense¹⁵ Studies in London. He said the pressures on the Egyptian economy would be difficult for any government.

"Some good moves have been taken, the question is whether these are sufficient to turn the economic crisis around or not," he said.

Words in This Story

foreign reserves –n. foreign money held by a nation's central bank

subsidy¹⁶ — n. government payments aimed at keeping the price of some product or service lower than it would be without the payments

regional — adj. related to an area, within a country or the world, that is separate for some reason

infrastructure — n. structures, such as roads, bridges, ports and airports, that are needed for a modern society

sufficient — adj. enough

1 intensified   

v.（使）增强， （使）加剧( intensify的过去式和过去分词 )

参考例句：

• Violence intensified during the night. 在夜间暴力活动加剧了。
• The drought has intensified. 旱情加剧了。 来自《简明英汉词典》

2 populous   

adj.人口稠密的，人口众多的

参考例句：

• London is the most populous area of Britain.伦敦是英国人口最稠密的地区。
• China is the most populous developing country in the world.中国是世界上人口最多的发展中国家。

3 economist   

n.经济学家，经济专家，节俭的人

参考例句：

• He cast a professional economist's eyes on the problem.他以经济学行家的眼光审视这个问题。
• He's an economist who thinks he knows all the answers.他是个经济学家，自以为什么都懂。

4 Oxford   

n.牛津（英国城市）

参考例句：

• At present he has become a Professor of Chemistry at Oxford.他现在已是牛津大学的化学教授了。
• This is where the road to Oxford joins the road to London.这是去牛津的路与去伦敦的路的汇合处。

5 advisory   

adj.劝告的，忠告的，顾问的，提供咨询

参考例句：

• I have worked in an advisory capacity with many hospitals.我曾在多家医院做过顾问工作。
• He was appointed to the advisory committee last month.他上个月获任命为顾问委员会委员。

6 restrictions   

约束( restriction的名词复数 )； 管制； 制约因素； 带限制性的条件（或规则）

参考例句：

• I found the restrictions irksome. 我对那些限制感到很烦。
• a snaggle of restrictions 杂乱无章的种种限制

7 monetary   

adj.货币的，钱的；通货的；金融的；财政的

参考例句：

• The monetary system of some countries used to be based on gold.过去有些国家的货币制度是金本位制的。
• Education in the wilderness is not a matter of monetary means.荒凉地区的教育不是钱财问题。

8 subsidies   

n.补贴，津贴，补助金( subsidy的名词复数 )

参考例句：

• European agriculture ministers failed to break the deadlock over farm subsidies. 欧洲各国农业部长在农业补贴问题上未能打破僵局。
• Agricultural subsidies absorb about half the EU's income. 农业补贴占去了欧盟收入的大约一半。 来自《简明英汉词典》

9 gulf   

n.海湾；深渊，鸿沟；分歧，隔阂

参考例句：

• The gulf between the two leaders cannot be bridged.两位领导人之间的鸿沟难以跨越。
• There is a gulf between the two cities.这两座城市间有个海湾。

10 unwilling   

adj.不情愿的

参考例句：

• The natives were unwilling to be bent by colonial power.土著居民不愿受殖民势力的摆布。
• His tightfisted employer was unwilling to give him a raise.他那吝啬的雇主不肯给他加薪。

11 forum   

n.论坛，讨论会

参考例句：

• They're holding a forum on new ways of teaching history.他们正在举行历史教学讨论会。
• The organisation would provide a forum where problems could be discussed.这个组织将提供一个可以讨论问题的平台。

12 lessening   

减轻，减少，变小

参考例句：

• So however much he earned, she spent it, her demands growing and lessening with his income. 祥子挣多少，她花多少，她的要求随着他的钱涨落。 来自汉英文学 - 骆驼祥子
• The talks have resulted in a lessening of suspicion. 谈话消减了彼此的怀疑。

13 costly   

adj.昂贵的，价值高的，豪华的

参考例句：

• It must be very costly to keep up a house like this.维修这么一幢房子一定很昂贵。
• This dictionary is very useful,only it is a bit costly.这本词典很有用，左不过贵了些。

14 infrastructure   

n.下部构造，下部组织，基础结构，基础设施

参考例句：

• We should step up the development of infrastructure for research.加强科学基础设施建设。
• We should strengthen cultural infrastructure and boost various types of popular culture.加强文化基础设施建设，发展各类群众文化。

15 defense   

n.防御，保卫；[pl.]防务工事；辩护，答辩

参考例句：

• The accused has the right to defense.被告人有权获得辩护。
• The war has impacted the area with military and defense workers.战争使那个地区挤满了军队和防御工程人员。

16 subsidy   

n.补助金，津贴

参考例句：

• The university will receive a subsidy for research in artificial intelligence.那个大学将得到一笔人工智能研究的补助费。
• The living subsidy for senior expert's family is included in the remuneration.报酬已包含高级专家家人的生活补贴。