Egypt’s capital is suffused with history and tradition, but scratch the surface and a city undergoing change at a dizzying pace is revealed, says Tom Otley.
Returning to Cairo after a break of more than a decade, it can seem like nothing has changed. The negatives still jump out at you: it’s chaotic, hot, over-populated and under-served by its infrastructure. At the periphery of the city, ugly modern blocks of apartments are built right by the side of the road, always unfinished. Things improve closer to the centre with the faded grandeur of the 19th-century belle epoque streets. Highlights include the relics of the ancient civilisation of Egypt collected in the dilapidated Egyptian Museum on Tahrir Square, while towards the city’s outskirts are the pyramids. There’s almost a lulling continuity to these observations; visitors to Cairo have been saying the same things for more than a century. Yet Egypt has had a remarkable decade, and the turmoil is still continuing.
Roll back to the 2011 revolution, followed by elections that brought the Muslim Brotherhood into power, and it seemed everything would change; and it did, with a few years of unrest and instability. Then the Brotherhood were overthrown in a military coup, and Abdel Fattah el-Sisi was installed as president.
This year he won the legitimate election practically uncontested, but enthusiasm was still in short supply for his election victory. Newspaper Al-Ahram said that only 42 per cent of the eligible population voted (though that is still around 25 million voters), and more than one million Egyptians spoiled their ballot papers. The positives of this result are that the security situation is definitely improving, and there are fewer atrocities. Speak to Egyptians and they will say they are glad there is stability, and that they support the government’s measures to maintain security. Such conversations are self-selecting, however, since you are talking to people who stand to benefit from that security. Go online and dissent isn’t hard to find, and that’s despite the government cracking down on freedom of speech and political activism. Egypt’s parliament gave the state powers to block social media accounts and penalise journalists held to be publishing “fake news” – and that includes Twitter and Facebook accounts, and blogs with more than 5,000 followers.
Facing challenges
Everyone is against fake news, but a free press matters. To take one example, the crash of EgyptAir Flight 804 from Paris to Cairo in 2016 killing all 66 people on board was blamed by the Egyptian authorities on terrorism and lax security at Charles de Gaulle Airport. French aircraft investigator BEA disagreed and, in turn, criticised the Egyptian authorities. BEA believes it was an on-board fire that caused the crash. Whatever the truth, after violent unrest and bombings in Cairo, it provided more reasons for international visitors to avoid the country.
According to the World Travel & Tourism Council’s (WTTC) latest economic impact report on Egypt: “To overcome these challenges, a government-sponsored ‘Egypt in our Hearts’ initiative subsidised domestic holidays for Egyptians.” This contributed to a “five-fold increase in the city’s [Cairo] domestic visitor arrivals over the past decade – the highest of all ten cities [the report measured] across both the Middle East and Africa regions. By 2016, nationals accounted for two-thirds of all travel spending in Cairo.”
But what about international visitors? Well, it’s not an empirical method of assessing the popularity of a city break destination, but finding a guidebook to Cairo isn’t easy, with editions by well-known publishers at least two years out of date. Meanwhile, there is no shortage of political or historical volumes detailing recent events, although inevitably these become quickly outdated as more turbulence overtakes their narratives.
Fortunately, the improving security situation is encouraging visitors to return. The latest WTTC figures show that tourism’s contribution to GDP in 2017 grew by 72.9 per cent compared to 2016. For the UK, 61,481 Brits travelled to Egypt in the first two months of 2018, an increase of almost 40 per cent compared to the same period last year.
The WTTC does, however, forecast that the tourism sector’s contribution to Cairo’s workforce at 1.6 per cent in 2016 will experience an annual growth of 5.7 per cent – nearly double the 3 per cent annual growth predicted for the whole country.
Pound for pound
Visitors will be encouraged by the exceptional value for money the destination now represents. The devaluation of the Egyptian pound in November 2016 saw the exchange rate move from nine to 18 Egyptian pounds to the US dollar. The impact of currency devaluation made Cairo one of the least expensive cities to live in and, according to Mercer’s Cost of Living Survey of 2018, it fell by 45 per cent and 22 places in the ranking as the Egyptian pound lost half its value. However, with the removal of subsidies on petrol and electricity, and inflation running at 11 per cent this year, most benefits are felt by foreigners.
What Egypt wants, of course, is investment: in power, in infrastructure, in new cities. Egypt’s population is around 100 million, but the majority live in Cairo, Alexandria and the Nile Delta. The most obvious consequence of this, to tourists at least, is the appalling Cairo traffic, but to those living there, it’s the housing that is more problematic and, as people are forced further from the city centre, this puts more strain on the road and rail infrastructure as they strive to get to their place of work every morning.
Cairo’s population has doubled in the past 20 years to 26 million. According to The Economist (June 14, 2018), Egypt has a shortage of three million homes and almost one million Cairenes live in slums, which the government considers unsafe, without basic amenities such as sewerage systems or clean water, while thousands are still making their home in the four-mile-long El’Arafa cemetery on Cairo’s outskirts.
The unfinished houses you see on the ring road around the city are evidence of this housing shortage, with the completed floors occupied and further floors waiting for additional money. The Economist estimated that “of Egypt’s 43m homes, 9m are vacant and half of those are incomplete”.
Just behind the five-star hotels on the Nile, such as the Conrad Cairo, the St Regis Cairo and the Nile Ritz-Carlton, is Boulaq, an area that is home to thousands of people living in slum conditions. It is prime real estate and the intention is to turn it into a high-end area called the Maspero Triangle, according to a Foster+Partners design. Rent controls mean people live here cheaply, albeit in poor-quality accommodation, but the relocation of these residents will turn it into a neighbourhood for the well-off.
There are also plans for a new administrative capital twenty-five miles outside of Cairo, which will see many government departments and foreign embassies and consulates relocate to a huge development financed and built by Chinese money, the intention being that it will eventually house five-million people. It’s a grand ambition, but previous new towns have not helped relieve the pressure on Cairo very much. Many business people will end up staying close to where their companies are located in New Cairo to the south east, where there is a Dusit, Westin and Renaissance Cairo, in the affluent suburb of Maadi or the new satellite town 32km from the centre that is known as 6th of October.
Some respite will come from offshore. In the past, Egypt enjoyed greater investment whenever the price of oil went up and stimulated foreign direct investment from nearby Gulf states.
Egypt also has the advantage of massive natural gas fields, including Noor, discovered by Italian company Eni off the coast of North Sinai; and the Zohr field, also in the Mediterranean. These will allow it to become a net gas exporter during 2019, and help Egypt’s aim of being a regional oil and gas trading hub. And, of course, Egypt controls the Suez Canal, still one of the world’s most important trade routes.
British investment
The UK has certainly identified Egypt as a focus. The UK is Egypt’s largest foreign investor, representing 41 per cent of foreign direct investment last year; and this year British Trade Envoy to Egypt, Sir Jeffrey Donaldson, headed the largest British trade delegation in nearly two decades with the emphasis on oil and gas, education, infrastructure and health. Over 50 companies took part, including existing investors in Egypt, such as Bombardier, Fujitsu, Mott MacDonald and GSK, as well as companies looking to invest there for the first time.
This was followed by British Minister for Investment, Graham Stuart, exploring opportunities for investing in knowledge-intensive sectors, such as education, technology and finance. The Egyptian government is promising reforms that should improve ease of doing business, including clear and predictable procurement rules, and strengthening the private sector with open and fair competition.
Stuart also held a round table discussion with representatives of multinational companies that have British interests, such as Actis, Bombardier, Fujitsu UK, G4S, GSK, HSBC, Shell, Sumitomo, Unilever and Vodafone. They affirmed Egypt’s strong investment potential and discussed how the Egyptian government’s commitment to the IMF reform programme, and to improving ease of doing business, will lay the groundwork for further investment. Speaking at the time, Stuart said: “With Egypt’s economic reforms and the UK’s departure from the EU, both countries are going through important periods of transition. These changes provide the opportunity to tear down barriers to trade and investment, strengthen our economic ties and grow annual trade numbers from their current level of £3 billion. The UK is Egypt’s number-one trade and investment partner – and my government is determined to see that position maintained.”
The importance of creating jobs is obvious in Egypt, where unemployment stands at 13 per cent, with 41 per cent of the 100 million population under the age of 20 and 61 per cent under 30. No wonder the country is the leading exporter of cheap labour to the Middle East and neighbouring Mediterranean countries – nearly ten million Egyptians live and work abroad, a significant brain drain on the economy. It’s where many of us have met Egyptians – in senior positions in hotels around the world, but particularly in the Middle East. Ironically, hotels in Cairo have trouble keeping staff since hospitality doesn’t pay particularly well in the country, so once trained they tend to move abroad.
For all the problems Egypt has had, it’s the people that may be the solution. Making generalisations about 100 million people is never a good idea, but the resilience and hard work of those you meet is obvious, as is their renowned sense of humour. Egyptians might not greet you with a smile, but it doesn’t take long for one to appear once you start chatting. Reason enough to return, along with the new Egyptian museum opening at the end of the year.
FROM THE ARCHIVE
Our feature on the city published in 2000 saw the country in its 18th year of President Hosni Mubarak’s rule. Then, as now, attracting tourists was on Egypt’s agenda – we reported that the president was pledging to continue subsidising an annual performance of Verdi’s Aida, where “arias soar across the desert against the backdrop of the pyramids”.
ESSENTIAL READING
Egypt on the Brink
Tarek Osman focuses on the period from Nasser to the Muslim Brotherhood, but stops in 2013 before the military coup that installed el-Sisi. This book succeeds in telling the story of the Egyptians as a people, and how they and their society have changed.
The Egyptians
If you read one book before going to Egypt, read this one by Jack Shenker. A wonderful writer who has immersed himself in Cairo for a decade, his passionate, angry, evocative and multi-layered tale of the city’s inhabitants may encourage you to take a detour from the well-beaten tourist trail.
Into the Hands of the Soldiers
A first-hand account of the lead-up to the revolution and its aftermath by The New York Times‘ David D Kirkpatrick. It is immediate and disarming in the author’s honesty about the limits of his knowledge and preconceptions he initially held.
