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Happy new year, Cairo?

Residents speak of a tough year, and worry about a tougher one ahead.

(Page 2 of 2)



There was an elected parliament, one packed with Islamists, the results of which were later annulled. There was a presidential election that pitted President Morsi against former Mubarak Prime Minister Ahmed Shafiq that saw Morsi walk off with the spoils. Neither option was enticing to Egypt's young revolutionaries, and in Morsi's victory – which was made possible by the Brotherhood breaking a promise not to run a candidate for president – there was evidence that the Islamist movement could not be taken at its word.

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Staff writer

Dan Murphy is a staff writer for the Monitor's international desk, focused on the Middle East. Murphy, who has reported from Iraq, Afghanistan, Egypt, and more than a dozen other countries, writes and edits Backchannels. The focus? War and international relations, leaning toward things Middle East.

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And, of course, there were clashes between protesters at Tahrir and at the presidential palace in Cairo, in the industrial towns of the Nile Delta, and once again in Port Said, along the country's economically vital Suez Canal. The constitution, which Egyptians were promised would be written by a truly representative body, was rushed through by Morsi and his allies over serious opposition towards the end of the year. When it came time for Egyptians to vote on it, it passed – but with less than 40 percent of the Egyptian electorate participating, many voters having lost hope that the political process was going to deliver anything of any tangible value to them or their families.

Attempts not made

While fixing Egypt's economic problems would be the work of years under even the best of circumstances, serious attempts to address how the national budget is administered, rampant corruption that makes being either a simple wage-earner or an entrepreneur a minefield, or the heavy-hand of the military in business, were not made. The average Egyptian was financially worse off at the end of 2011, and worse off still at the end of 2012. This simple reality is how Egyptians are judging recent events, and why so many of them are so deeply worried. 

Now the country is less than two months away from electing a new parliament, extending a period of political uncertainty. A new political reality will be created by that election – the fifth national vote in two years – and will lead to more political uncertainty as factions in parliament are formed, and Egyptian politicians test the new rules of the game. Local and foreign investors will stay on the sidelines for awhile yet, hoping for some clarity as to the new rules –clean ones or dirty ones, new ways of doing business or the same old rent-seeking of the past – before they put any more skin in the game. 

Meanwhile, Egyptians are watching, and worried. The Egyptian pound plunged to an eight-year low against the dollar in the past month, and the Egyptian government's foreign reserves now stand at about $15 billion, less than half of what they were at the time of Mubarak's ouster. That exchange rate – and the soaring interest the Egyptian government pays on international borrowing – has a host of implications for the subsidized bread, cooking fuel, and gasoline that millions of Egyptians rely on.

A random walk through Cairo can't show how finely poised Egypt's situation is. But if you stop to talk for a few hours, you can feel it.

It's the economy, stupid, as a US political hack had it 20 years ago. And it's the economy that Egypt needs to focus on in 2013.

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