Egypt's economy

USA Today (David J. Lynch)

It's a very slow news day today, so here's a general interest piece about the modern Egyptian economy, for those whose interests extend beyond the ancient. Thanks very much to Rick Menges for sending me the link.

Four years into a robust economic expansion, this country has shaken off its history of sleepy Arab state socialism and embraced the market. A rush of construction is throwing up office buildings as fast as Western-sounding names, such as Palm Hills, can be dreamed up for them. Sluggish state-owned companies from banks to department stores are being sold to private investors, and foreign capital is flooding in, lured by the scent of certain profit.

Egypt today has all the earmarks of a gathering boom. Strange then, that most Egyptians seem so miserable. "Living conditions are difficult. Everyone is suffering because of higher prices," says a weary Gomaa Ali, a local restaurant owner.

At Ali's tiny downtown eatery one recent day, the flies outnumbered the customers. Double-digit inflation combined with stagnant wages has eaten into his business and made the government's talk of a surging economy seem hopelessly divorced from reality. "People have become more reluctant to eat out. If you'd come here two or three years ago, this place would be packed, and they'd have to line up to get a table," he says, gesturing at the empty chairs and sweating in the oppressive midday heat.

Even as the government touts a litany of impressive statistics, Ali's complaints find echoes among Egypt's long-suffering 80 million citizens. Ambitious economic reforms launched in 2004 have won plaudits from the business community but have done little for the average Egyptian.

See the above page for the full story.