Thu July 11, 2013
With President Morsi Out, Gulf States Open Their Checkbooks
Originally published on Thu July 11, 2013 11:13 am
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It's been mostly quiet in Egypt today. The military is still looking to arrest more leaders of the Muslim Brotherhood on charges of inciting violence. And the political struggle continues over who will run the country. Much of the public fury that provoked last week's ouster of President Mohamed Morsi was fueled by the country's poor economic conditions. With Morsi out, expectations are high that foreign aid and investment will return; that the economy will turn around and, for average Egyptians, the lights will stay on.
NPR's Leila Fadel sent this report.
LEILA FADEL, BYLINE: As soon as Morsi was overthrown by Egypt's military, the stock market shot up. And the money from wealthy Gulf States started flowing. The United Arab Emirates pledged a $3 billion aid package, Saudi Arabia five billion, and Kuwait followed with four billion to jumpstart the crippled economy.
It was a quick turnaround from the wealthy Gulf nations, especially for Saudi Arabia and the UAE, who'd viewed the Muslim Brotherhood, to which Morsi belongs, as a threat to their own undemocratic leadership.
HANY GENENA: Both countries are not really comfortable with a movement that may threaten their own stability, as well. So once the Muslim Brothers were out of the scene, it returns to normal basically. They started to cooperate again with the military-backed government.
FADEL: That's Hany Genena, the chief economist at Pharos Holding, a Cairo-based investment firm. He adds that it's likely that Qatar's aid will now peter out. The island Gulf nation had been a huge backer of the Brotherhood and other Islamists, who'd risen up following the 2011 revolts that swept through the region. But it's been losing ground to its Saudi rival and bet heavily on Morsi.
Genena says that Morsi's ouster is great news for the economy. By all indications, he says, things are picking up.
GENENA: Investors are extremely optimistic.
FADEL: In the streets, that same optimism is rampant among the many Egyptians who opposed Morsi's leadership.
(SOUNDBITE OF VEHICLES AND TRAFFIC)
FADEL: At a gas station in central Cairo, Mohsen Fahmy waits to fill up his tank. But today, there is no line stretching for blocks.
MOHSEN FAHMY: (Foreign language spoken)
FADEL: Everything is available now, he says.
Almost overnight, the power cuts and diesel shortages that have plagued Egypt are mysteriously gone. Analysts say it's a sign of just how uncooperative the entrenched anti-Brotherhood bureaucracy was when Morsi was in power. And now that he is out of power, billionaire Egyptian businessmen, like Naguib Sawiris, say they're ready to put money back in Egypt.
Sawiris has long been an outspoken critic of Morsi, and made his fortune under ousted President Hosni Mubarak.
NAGUIB SAWIRIS: People like us who have held back for two years will come back now and we will start with ourselves. We won't wait for others to come. Because if the Egyptians don't invest in their own country, who's going to believe in their country?
FADEL: But not everyone is so optimistic. The country is more polarized then it's ever been and people fear more unrest. Morsi's supporters continue mass protests demanding his reinstatement.
At a Cairo vegetable market, Um Ahmed picks out eggplants for dinner.
UM AHMED: (Foreign language spoken)
FADEL: We feel worried. We feel threatened, she says. Every day, we hear people are dead, thousands are wounded. We just want peace and safety.
And the excitement will likely wear off, says Michael Wahid Hanna of the Century Foundation.
MICHAEL WAHID HANNA: There's clearly at the moment a kind of irrational exuberance
FADEL: The underlying economic problems are still here, Hanna says; a wasteful subsidy system that needs to be reformed, rising unemployment and corruption that stifles competitive markets. All of these issues that plagued the Morsi government will also confront whoever comes next.
Leila Fadel, NPR News, Cairo. Transcript provided by NPR, Copyright NPR.