4 ms·

Isn't egypt having significant financial troubles?

by bawolff 2y ago

nvr219 2y ago
They will be having them after this
- bawolff 2y ago
  I imagine the red sea shipping crisis and the new capital are probably a bigger part of the problem, but i cant imagine billion dollar museums are helping.
casper14 2y ago
Yes, likely because they overspend on things like 1B museums
- deleted 2y ago
  [deleted]
- dangus 2y ago
  It’s funny to me that people still think $1 billion is a lot of money for a government. 5 million people per year visit the MET in NYC, which is the 5th most popular museum in the world. Tickets are $30. Seven years of revenue is $1 billion. Almost 15 million people visit the Pyramids of Giza per year. Egypt is the 9th most popular tourist destination in the world. If only half of those people visit the new museum and spend $30 on admission that means they cross $1 billion in revenue in 5 years, and that assumes nobody buys a damn thing from the gift shop or donates to the endowment.
  - sinaid 2y ago
    And the fomos who will visit Egypt just to see the new shiny thing.
netdur 2y ago
Yes, Egypt has faced significant financial challenges. Recently, there have been substantial investments from the UAE, purchasing a city for $35 billion, with potential similar investments from Saudi Arabia. Despite these inflows, concerns about how these funds are managed, particularly regarding military influence, remain prevalent
- akira2501 2y ago
  > from the UAE, purchasing a city for $35 billion Ras al-Hekma for those curious. It sounds like a terrible deal on all sides. It's a bad vehicle for UAE money, it leaves Egypt with "35% guaranteed profits" on a planned city, and the UN is busily green washing the entire affair to curry political favor. > concerns about how these funds are managed Egypt seems completely squeezed. It's uniquely impacted by both the war on Ukraine and Gaza with the IMF having to step in and give them $3 billion later upgraded to $8 billion in emergency relief. The money is going to evaporate. My concern is there won't be any local economy or businesses left under these policies when it all dries up.
  - alephnerd 2y ago
    > Ras al-Hekma for those curious. It sounds like a terrible deal on all sides It actually makes sense. Most tourism in Egypt comes from Eastern Europeans (especially Russians and Ukrainians), for whom Sharm al-Sheikh is their Cabo. If you've looked at a map, it's also located in Sinai, where there's an ongoing Muslim Brotherhood turned IS insurgency (which also enflamed neighboring Gaza). Moving resort tourism to much more defensible Ras al-Hekma works, and the UAE being the New York of the region had enough capital to co-invest to develop it (also didn't hurt to help line up politicians pockets). And Egypt (with UAE, Saudi, and some Indian capital) has been building out alternatives like Siwa. I actually chatted a eco-lodge owner from Siwa while I was stuck at a layover in Istanbul Airport - a lot of their tourism it now targeting the domestic market, Gulf market, some western hippy types, and Indians. > My concern is there won't be any local economy or businesses left under these policies when it all dries up The Egyptian economy is stabilizing and UAE, Saudi, Chinese, and Indian money is flowing in as FDI [0], and pushing reforms accordingly. Heck, Egypt's GDP Growth Rate in FY22 was 6.6% according to the World Bank, and has always been between 2.5-6% post-coup. [0] - https://www.cfr.org/in-brief/can-egypts-economic-overhaul-stave-crisis https://www.cfr.org/in-brief/can-egypts-economic-overhaul-st...
nextstepguy 2y ago
Egypt's tourism revenues hit a record high of $13.6 billion in FY2022/2023. Spending less than 10% to increase the purpose of choosing this country as a destination sounds reasonable, but as long as the P&L balances, I don't see why not.
- bobthepanda 2y ago
  The problem is the rest of the balance sheet is pretty red. The government is spending $60B it does not have to build a new capital, and has already taken IMF lending. https://www.nytimes.com/2022/10/08/world/middleeast/egypt-new-administrative-capital.html https://www.nytimes.com/2022/10/08/world/middleeast/egypt-ne...
  - objektif 2y ago
    You need to worry about the rest of the spending. This project will bring many many times of its cost as profit over the years.
    - bobthepanda 2y ago
      I think it is pretty safe to have doubts about Egyptian government profit projections. They also said the same thing about doubling the Suez canal but revenues did not meet projections and now they are planning to expand it again. https://www.middleeasteye.net/news/egypt-plans-expand-suez-canal-again-after-8-billion-project-fails-achieve-goals https://www.middleeasteye.net/news/egypt-plans-expand-suez-c...
    - bawolff 2y ago
      It won't if the rest of the country collapses from being overleveraged.
  - dangus 2y ago
    Egypt’s debt to GDP ratio is falling and is lower than the USA. https://www.statista.com/statistics/377984/national-debt-of-egypt-in-relation-to-gross-domestic-product-gdp/ https://www.statista.com/statistics/377984/national-debt-of-...
aprilthird2021 2y ago
Egypt's one and only ever democratically elected president was overthrown by the current dictator, who is supported by the West. He doesn't have any incentive to fix any of Egypt's financial problems and is currently building a palace for himself away from the capitol with a gold throne
- candiodari 2y ago
  The "one and only ever democratically elected president" also had zero incentive to fix any of Egypt's financial problems and ... frankly ... was a terrorist candidate. Sorry "islamist". Which is to say, he uses violence, massacres and even torture to achieve his political aspirations. The first thing he did when elected was cancel elections, give himself unlimited power. Ironically that was part of his downfall. Islamists believe there is only 1 islam. So did Morsi. And tried to ally Egypt to Iran. Tried to ally Egypt to the Syrian uprising (to ISIS, in other words). Islamic extremists in all these places, as it turns out, suddenly and violently disagreed with islam's "only one islam" fantasy, did not want to compromise and preferred to (physically) attack his government, with a few dozen dead as result. He lost control of that situation. And then it turns out the Egyptian army, government did not like their president cooperating with islamists elsewhere, including Hamas, who were attacking and killing people left and right, with Morsi's support. Also he got terrorists inside Egypt, the "muslim brotherhood" to torture and kill his political opponents. No offense, but Egypt, Egypt's people and the world dodged a SERIOUS bullet when this guy got deposed. A civil war would have been the minimum consequence of him remaining in power.
  - aprilthird2021 2y ago
    > he uses violence, massacres and even torture to achieve his political aspirations. > The first thing he did when elected was cancel elections, give himself unlimited power. Exactly like the current dictator of Egypt, El-Sisi the secularist, if you want to put things on that plane... You act like Egypt dodged a bullet by having their own elected leader killed brutally in a violent coup. But the bullet was fired, and is still being fired on them as they're now led by a leader who is not beholden to them at all. If Morsi was as terrible as you said and people hated him as much as you claim, he would have lost the next election. But there won't be a next election because the governments you didn't mention, who support the dictator, thought it would be better if Egypt never had another democracy so long as their political objectives are met. I happen to believe in democracy, and I believe it is the best tool against terrible leaders. You may disagree, but don't try to paint your enemies as violent and irrational when you are the one who thinks force should be used to overturn the will of the people.
blackeyeblitzar 2y ago
Yes. They have other boondoggles going as well, like a new alternative to Cairo: https://www.cnn.com/world/egypt-new-administrative-capital-spc-intl/index.html https://www.cnn.com/world/egypt-new-administrative-capital-s... Inflation at almost 30% and lending rates around that as well. Taxes are being increased by more than 30% as well, mandated by the IMF for past borrowing.

Isn't egypt having significant financial troubles?

nvr219 2y ago

They will be having them after this

bawolff 2y ago
I imagine the red sea shipping crisis and the new capital are probably a bigger part of the problem, but i cant imagine billion dollar museums are helping.

casper14 2y ago

Yes, likely because they overspend on things like 1B museums

deleted 2y ago
[deleted]
dangus 2y ago
It’s funny to me that people still think $1 billion is a lot of money for a government. 5 million people per year visit the MET in NYC, which is the 5th most popular museum in the world. Tickets are $30. Seven years of revenue is $1 billion. Almost 15 million people visit the Pyramids of Giza per year. Egypt is the 9th most popular tourist destination in the world. If only half of those people visit the new museum and spend $30 on admission that means they cross $1 billion in revenue in 5 years, and that assumes nobody buys a damn thing from the gift shop or donates to the endowment.
- sinaid 2y ago
  And the fomos who will visit Egypt just to see the new shiny thing.

netdur 2y ago

Yes, Egypt has faced significant financial challenges. Recently, there have been substantial investments from the UAE, purchasing a city for $35 billion, with potential similar investments from Saudi Arabia. Despite these inflows, concerns about how these funds are managed, particularly regarding military influence, remain prevalent

akira2501 2y ago
> from the UAE, purchasing a city for $35 billion Ras al-Hekma for those curious. It sounds like a terrible deal on all sides. It's a bad vehicle for UAE money, it leaves Egypt with "35% guaranteed profits" on a planned city, and the UN is busily green washing the entire affair to curry political favor. > concerns about how these funds are managed Egypt seems completely squeezed. It's uniquely impacted by both the war on Ukraine and Gaza with the IMF having to step in and give them $3 billion later upgraded to $8 billion in emergency relief. The money is going to evaporate. My concern is there won't be any local economy or businesses left under these policies when it all dries up.
- alephnerd 2y ago
  > Ras al-Hekma for those curious. It sounds like a terrible deal on all sides It actually makes sense. Most tourism in Egypt comes from Eastern Europeans (especially Russians and Ukrainians), for whom Sharm al-Sheikh is their Cabo. If you've looked at a map, it's also located in Sinai, where there's an ongoing Muslim Brotherhood turned IS insurgency (which also enflamed neighboring Gaza). Moving resort tourism to much more defensible Ras al-Hekma works, and the UAE being the New York of the region had enough capital to co-invest to develop it (also didn't hurt to help line up politicians pockets). And Egypt (with UAE, Saudi, and some Indian capital) has been building out alternatives like Siwa. I actually chatted a eco-lodge owner from Siwa while I was stuck at a layover in Istanbul Airport - a lot of their tourism it now targeting the domestic market, Gulf market, some western hippy types, and Indians. > My concern is there won't be any local economy or businesses left under these policies when it all dries up The Egyptian economy is stabilizing and UAE, Saudi, Chinese, and Indian money is flowing in as FDI [0], and pushing reforms accordingly. Heck, Egypt's GDP Growth Rate in FY22 was 6.6% according to the World Bank, and has always been between 2.5-6% post-coup. [0] - https://www.cfr.org/in-brief/can-egypts-economic-overhaul-stave-crisis https://www.cfr.org/in-brief/can-egypts-economic-overhaul-st...

nextstepguy 2y ago

Egypt's tourism revenues hit a record high of $13.6 billion in FY2022/2023. Spending less than 10% to increase the purpose of choosing this country as a destination sounds reasonable, but as long as the P&L balances, I don't see why not.

bobthepanda 2y ago
The problem is the rest of the balance sheet is pretty red. The government is spending $60B it does not have to build a new capital, and has already taken IMF lending. https://www.nytimes.com/2022/10/08/world/middleeast/egypt-new-administrative-capital.html https://www.nytimes.com/2022/10/08/world/middleeast/egypt-ne...
- objektif 2y ago
  You need to worry about the rest of the spending. This project will bring many many times of its cost as profit over the years.
  - bobthepanda 2y ago
    I think it is pretty safe to have doubts about Egyptian government profit projections. They also said the same thing about doubling the Suez canal but revenues did not meet projections and now they are planning to expand it again. https://www.middleeasteye.net/news/egypt-plans-expand-suez-canal-again-after-8-billion-project-fails-achieve-goals https://www.middleeasteye.net/news/egypt-plans-expand-suez-c...
  - bawolff 2y ago
    It won't if the rest of the country collapses from being overleveraged.
- dangus 2y ago
  Egypt’s debt to GDP ratio is falling and is lower than the USA. https://www.statista.com/statistics/377984/national-debt-of-egypt-in-relation-to-gross-domestic-product-gdp/ https://www.statista.com/statistics/377984/national-debt-of-...

aprilthird2021 2y ago

Egypt's one and only ever democratically elected president was overthrown by the current dictator, who is supported by the West. He doesn't have any incentive to fix any of Egypt's financial problems and is currently building a palace for himself away from the capitol with a gold throne

candiodari 2y ago
The "one and only ever democratically elected president" also had zero incentive to fix any of Egypt's financial problems and ... frankly ... was a terrorist candidate. Sorry "islamist". Which is to say, he uses violence, massacres and even torture to achieve his political aspirations. The first thing he did when elected was cancel elections, give himself unlimited power. Ironically that was part of his downfall. Islamists believe there is only 1 islam. So did Morsi. And tried to ally Egypt to Iran. Tried to ally Egypt to the Syrian uprising (to ISIS, in other words). Islamic extremists in all these places, as it turns out, suddenly and violently disagreed with islam's "only one islam" fantasy, did not want to compromise and preferred to (physically) attack his government, with a few dozen dead as result. He lost control of that situation. And then it turns out the Egyptian army, government did not like their president cooperating with islamists elsewhere, including Hamas, who were attacking and killing people left and right, with Morsi's support. Also he got terrorists inside Egypt, the "muslim brotherhood" to torture and kill his political opponents. No offense, but Egypt, Egypt's people and the world dodged a SERIOUS bullet when this guy got deposed. A civil war would have been the minimum consequence of him remaining in power.
- aprilthird2021 2y ago
  > he uses violence, massacres and even torture to achieve his political aspirations. > The first thing he did when elected was cancel elections, give himself unlimited power. Exactly like the current dictator of Egypt, El-Sisi the secularist, if you want to put things on that plane... You act like Egypt dodged a bullet by having their own elected leader killed brutally in a violent coup. But the bullet was fired, and is still being fired on them as they're now led by a leader who is not beholden to them at all. If Morsi was as terrible as you said and people hated him as much as you claim, he would have lost the next election. But there won't be a next election because the governments you didn't mention, who support the dictator, thought it would be better if Egypt never had another democracy so long as their political objectives are met. I happen to believe in democracy, and I believe it is the best tool against terrible leaders. You may disagree, but don't try to paint your enemies as violent and irrational when you are the one who thinks force should be used to overturn the will of the people.

blackeyeblitzar 2y ago

Yes. They have other boondoggles going as well, like a new alternative to Cairo: https://www.cnn.com/world/egypt-new-administrative-capital-spc-intl/index.html https://www.cnn.com/world/egypt-new-administrative-capital-s... Inflation at almost 30% and lending rates around that as well. Taxes are being increased by more than 30% as well, mandated by the IMF for past borrowing.