It’s dangerous being an Asian in Egypt these days. A Chinese student at Al-Azhar University, who has been living in Cairo for five years, told the Daraj website that he was always treated well and received warmly wherever he went. “But now everybody’s afraid of me,” he said. “Nobody wants any contact with me, whether for eating or studying.”
He’s not alone. Online videos show how someone who appeared Asian was thrown off a bus by the passengers, and at a popular food stand in Cairo, customers ran away when a person who appeared Asian showed up.
If Egyptians want a guide for combating the novel coronavirus, it can be found not on the Egyptian Health Ministry’s website but on social media; sites are suggesting, for example, that you eat salty smoked fish, the kind usually enjoyed on holidays.
Another piece of advice is to purify yourself before prayers; go heavy on the nostrils, because the purifying water removes the virus. Others warn against having sex because it can transmit the virus, or to beware of pets. And especially: “Don’t take an aspirin if you’re already infected, because it’s known that aspirin kills corona patients.”
Doctors are also posting videos, but the prices for the treatment they’re offering are exorbitant. Pharmacy owners have also inflated the price of basic flu medication and face masks; the prices of the latter are up tenfold.
The authorities continue to insist that everything is under control and that the health services are prepared to receive infected patients in specially isolated wards. Egypt hasn’t yet closed its borders, and schools and universities were only closed on Sunday.
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But the dozens of cases of infection (it’s hard to obtain accurate figures) in a country with a population of 100 million, a few days after the Health Ministry declared that Egypt is free of the virus, have stoked the flames. It seems Egypt will have to join other countries in the region and close its gates.
The economic damage started once Saudi Arabia prevented the entry of foreign visitors hoping to go to Mecca and Medina. Egyptian travel agencies issued 4,000 entry visas for pilgrims to Mecca just before the Saudis' decision, but most of these pilgrims will now be left in the lurch.
Each year, 200,000 Egyptian pilgrims make their way to Saudi Arabia, and registration for entry visas usually begins around now. The Haj takes place in July this year, and this time around, registration is low; people seeking visas are loath to make a deposit lest they not be able to travel.
Incoming tourism, an important source of revenue ($12.5 billion last year), is taking a big hit. According to hoteliers and tour guides, the number of visits has plunged to 10 percent of its normal level and may shrink further after 55 tourists contracted the coronavirus while on a tour boat on the Nile, with one German tourist dying.
Tourism in Egypt began to recover only two years ago following the turmoil of the Arab Spring and the absence of Russian tourists after the 2015 downing of a Russian airliner that killed 224 people. Last week’s visits by the health and tourism ministers to Luxor was designed to show that the sites are safe and the tourists are still coming, but that didn’t stop the rush of wholesale cancellations.
The tourism freeze means an uptick in unemployment and a hit to budget forecasts, which come on top of fears that foreign investment will also slow, especially in the energy industry. The plummeting oil and gas prices that accompany the slower economy mean investors might stay away from Egypt’s burgeoning natural gas and oil industry. Oil prices are also closely watched by the hundreds of thousands of Egyptians who work in the Gulf states and send most of their income back home.
The assessment is that these transfers, estimated at $25 billion a year, may be significantly reduced if Gulf-state workers start sending workers home. This will hurt Egypt and most of the poorer Arab states, as well as Pakistan and the Philippines, which provide most of the foreign manpower in the region’s oil-rich countries.
As a result, thousands of workers will flood Egypt’s labor market, which already can’t provide enough jobs for the unemployed. Some workers will return with wads of money, but they’ll have a very hard time buying an apartment due to the chronic shortage – a shortfall in the hundreds of thousands of apartments. Plus the demand they create will stoke wild inflation in the housing market, stinging the middle class and poor.
Egypt will then find itself in a real estate bubble that’s bound to burst, just as happened in Jordan in the ‘90s when Gulf states expelled Jordanian workers after Jordan backed Saddam Hussein. The bubble that burst led to a deep economic crisis.
In the meantime, the building of Egypt’s nuclear reactor is gaining pace. The facility will supply 10 percent of the country’s electricity needs, later growing to 30 percent. Three companies, among Egypt’s largest, are building the reactor after winning a bid put out by the Rosatom State Nuclear Energy Corporation, which is responsible for building the reactor, or actually four of them.
Egyptian technicians and experts have begun training at a reactor in Kursk, Russia; there they’ll learn about safety procedures, maintenance and operation of the facilities, which will be built in El Dabaa on the Mediterranean coast. Ideas about an electricity-generating reactor have been floating around for 50 years, each time postponed mainly because of a lack of funds and manpower.
It seemed that the project that Egypt and Russia agreed on in 2015 would be shelved too, but the meteoric rise in population helped force Egypt to speed up construction. Also pushing things along was a generous $25 billion loan from Russia. The reactor is expected to become operational in 2023, with Egypt starting to repay its loan in 2026 and payments spread out over 13 years.
The decision to build the reactor is still controversial because the area where it’s going up could have served as a thriving tourist region. Indeed, in the Mubarak era, large swaths there were sold to Egyptian investors who aimed to build vacation villages and tourist centers. In the end, they had to retreat. Other critics believe that the discovery of the giant Zohr offshore natural gas field may make the reactor superfluous.
The Palestinian angle
At a time when countries are pursuing renewable energy sources such as solar and wind, the construction of nuclear reactors is an outdated and even dangerous move that will leave Egypt heavily indebted to Russia. But such criticism is no longer relevant now that the Sissi regime has gone forward with the reactor.
The tightening links between Egypt and Russia aren’t popular with the United States. The administration didn’t oppose the plan to build the reactors after Egypt agreed to tightly monitor the use of the radioactive material, but another deal signed last August, the $2 billion purchase of 50 MiG fighters, is causing concern. According to Western media outlets, the U.S. administration warned President Abdel-Fattah al-Sissi about the implications of this deal, including the possibility that Washington would impose sanctions on Egypt and freeze the military aid it provides as part of the Camp David Accords.
Russia’s increasing involvement in the Middle East, both in Syria and Libya, at a time when the United States plans to reduce its presence in the region, poses a tough dilemma for the U.S. administration. Despite the serious dispute with Turkey over its purchase of S-400 antiaircraft missiles from Russia, the United States is backing Ankara’s moves in Syria, pleased with the tensions between Turkey and Russia.
Meanwhile, in Libya, Egypt and Russia are cooperating closely in helping separatist Khalifa Haftar against the Libyan government supported by Washington and receiving military aid from Turkey and Qatar. U.S. efforts to reconcile the sides in Libya have failed so far.
On the one hand, Egypt, the United Arab Emirates and Saudi Arabia, which support Haftar, are important American allies, but in Libya these countries are operating in collaboration with Russia. On the other hand, the United States is committed to maintaining good relations with Qatar and Turkey due to its interests elsewhere in the region.
A similar dilemma faces Egypt, because Russia is also showing great interest in the Palestinian issue, a development that troubles Cairo. Earlier this month, Hamas leader Ismail Haniyeh went to Moscow and announced that Russia was willing to host an intra-Palestinian reconciliation summit, presenting a list of suggestions for solving the conflict between Hamas and Fatah. Egypt is furious at Haniyeh after he went to Qassem Soleimani’s funeral in Iran despite having told Egypt he wouldn’t go. Haniyeh called Soleimani “the shahid of al-Quds” ("the martyr of Jerusalem").
With Egypt’s acquiescence, Haniyeh has embarked on a months-long trip to several Middle Eastern capitals and to other Islamic states. In between visits he stays in Qatar. Senior Hamas officials don’t think Egypt will let him back into the Gaza Strip.
Haniyeh declared that his meetings with senior Russian officials weren’t intended to harm Egypt’s status as the lead player in managing the Palestinian conflict and that “relations with Egypt are excellent.” Still, Egypt isn’t happy about the parallel pathway Haniyeh is trying to open. Hamas leadership elections are due this summer; some commentators believe that Cairo may prefer the return of Khaled Mashal as political chief.
And now Egypt’s full plate includes the coronavirus, which could become factor No. 1. The tiny virus holds Egypt’s coffers in its hands.