Is business as usual possible in Egypt?

Dr Elizabeth Stephens takes a look at the current condition of the Egyptian economy, and asks whether businesses will be able to operate with any kind of normality.

A series of challenges have been presented to investors since the deposing of Hosni Mubarak, with uncertainty and outbreaks of violence exerting downward pressure on investment flows. Despite the deteriorating economic environment and payment delays that plague the oil and gas sector in particular, many foreign companies have remained committed to their Egyptian operations, anticipating a return to stability.

Events in the past eight weeks - the ousting of President Mohammed Morsi and the military’s clearing of two protests camps in Cairo resulting in the death of hundreds of Egyptians – have fundamentally altered these calculations. The potential for disintegration has become clear.

The inflow of funds from the Gulf states is positive and more funding is likely to be announced in the coming months if there is a fall in violence. Egypt is receiving several billion dollars in financial aid and considerable assistance in kind. Saudi Arabia is paying directly for wheat contracts while the Qataris are supplying gas, creating a more positive picture than the USD 19 billion in foreign exchange reserves implies.

In the short term Egypt’s economy will muddle along but underlying economic problems will worsen over the course of the year due to disinvestment. Saudi Arabia is muting the figure of USD 12 billion in aid for the Egyptian fiscal year of July to June 2014 but even Riyadh with its deep pockets will be reluctant to bankroll another state indefinitely.

Over the medium term we may end up with predictable confrontation; cycles of protests that don’t escalate in the manner of recent weeks but with each protest having the potential to unleash another uprising. This makes it difficult for companies to recommit fully to their Egyptian operations because of the risk this creates in moving staff and their families back to Cairo.

While parallels have been drawn with Algeria in the 1990s, one of the many notable differences is that Algiers could be ignored by oil companies operating in the country in a way that Cairo cannot. Egypt’s economy is dependent on the service sector whereas Algeria was a hydrocarbons-dependent economy. Ultimately, Algeria was able to transcend its difficulties with higher state spending as oil prices rose. There is no such light on the horizon for Egypt.

Oil and gas companies recently renegotiated payment agreements with the government and payments were to be resumed in exchange for the reinstatement of investment programmes. In the current climate companies will be reluctant to ramp up investment and a new agreement will need to be reached with interim oil minister Sherif Ismail. Ismail knows the energy companies well and will be sympathetic to their predicament, although the outlook for either party is not positive at present.

In contrast to Libya and Iraq, foreign investors in Egypt’s oil and gas sectors can’t even argue that commitment in the short term will lead to worthwhile gains and financial upside in the future. There is no reserve replacement potential for the next five years at least and the risk of expropriation will rise as the domestic energy balance becomes more precarious.

Astute investors had their credit and political risk insurance in place ahead of the uprisings. While the insurance market has remained open throughout the course of Egypt’s political transition, with some rate and capacity fluctuations, the recent coup and violence has led the private market to close for new credit and investment risk. Existing cover continues and underwriters will honour their commitments but support for new market entrants is only available from multilateral insurers for very select investments. Some limited insurer appetite remains for political violence cover.

The Egyptian economy is highly dependent upon the service sector. Photograph: Getty Images.

JLT Head of Credit & Political Risk Advisory

Getty
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Levi Bellfield, Milly Dowler and the story of men’s violence against women and girls

Before she was so inextricably connected to the phone hacking scandal, Milly Dowler was one of many women maimed and killed by a violent man.

The name Milly Dowler has meant phone hacking since July 2011. The month before that, Levi Bellfield (already imprisoned for the murders of Marsha McDonnell and Amelie Delagrange, and the attempted murder of Kate Sheedy) had been convicted of killing her, nine years after her death. But almost immediately, she became the centrepiece of Nick Davies’s investigations into Fleet Street “dark arts”, when it was revealed that News of the World journalists had accessed her voicemail during the search for her.

Suddenly her peers were not McDonnell, Delagrange and Sheedy, but Hugh Grant, Leslie Ash, Sadie Frost, Jude Law. People she could only have known from TV, now her neighbours in newsprint. Victims of a common crime. She had attained a kind of awful fame, and remains much better known than McDonnell, Delagrange and Sheedy.

There is a reason for that: with Milly Dowler, there was hope of finding her alive. Weeks of it, the awful hope of not knowing, the dull months of probability weighing down, until finally, in September 2002, the body. McDonnell, Delagrange and Sheedy were attacked in public places and found before they were missed. It is not such an interesting story as the schoolgirl who vanishes from a street in daylight. Once there were some women, who were killed and maimed by a man. The end.

Even now that Bellfield has confessed to kidnapping, raping and killing Milly, it seems that some people would like to tell any story other than the one about the man who kidnaps, rapes, kills and maims girls and women. There is speculation about what could have made him the kind of monster he is. There must be some cause, and maybe that cause is female.

Detective Chief Inspector Colin Sutton (who worked on the McDonnell and Delagrange murders) has said insinuatingly that Bellfield “dotes on his mother and her on him. It's a troubling relationship.” But it was not Bellfield’s mother who kidnapped, raped, killed and maimed girls and women, of course. He did that, on his own, although he is not the first male killer to be extended the courtesy of blaming his female relatives.

Coverage of the Yorkshire Ripper accused his wife Sonia of driving him to murder. “I think when Sutcliffe attacked his 20 victims, he was attacking his wife 20 times in his head,” said a detective quoted in the Mirror, as if the crimes were not Sutcliffe’s responsibility but Sonia’s for dodging the violence properly due to her. Lady Lucan has been successfully cast by Lucan’s friends as “a nightmare” in order to foster sympathy for him – even though he systematically tried to drive her mad before he tried to kill her, and did kill their children’s nanny, Sandra Rivett. Cherchez la femme. Cherchez la mom.

I know little about Bellfield’s relationship with his mother, but one of his exes spoke about him earlier this year. Jo Colling told how he had terrorised her while they were together, and stalked her after she left. “When I knew he was with another woman and not coming home it was a relief, but now I know what he was capable of, I feel guilty,” she said. “I did get an injunction against him, but it only made him even angrier.”

Colling fears that she could have prevented Bellfield’s murders by going to the police with her suspicions earlier; but since the police couldn’t even protect her, it is hard to see what difference this could have made, besides exposing herself further to Bellfield’s rage. Once there was a woman who was raped, beaten and stalked by the man she lived with. The end. This is a dull story too: Colling’s victimisation is only considered worth telling because the man who victimised her also killed Milly Dowler. Apparently the torture of a woman is only really notable when the man who does it has committed an even more newsworthy crime.

Throughout his engagements with the legal system, Bellfield seems to have contrived to inflate his own importance. Excruciatingly, he withheld his confession to murdering Milly until last year, leaving her family in an agony of unknowing – and then drew the process out even further by implicating an accomplice, who turned out to have nothing at all to do with the crime. He appears to have made the performance into another way to exercise control over women, insisting that he would only speak to female officers about what he did to Milly.

It is good that there are answers for the Dowler family; it is terrible that getting them let Bellfield play at one more round of coercions. And for the rest of us, what does this new information tell us that shouldn’t already be obvious? The story of men’s violence against girls and women is too routine to catch our attention most of the time. One woman killed by a man every 2.9 days in the UK. 88,106 sexual offences in a year.

Once there were some girls and women, who were tortured, stalked, kidnapped, raped, killed and maimed by a man. Dowler, McDonnell, Delagrange, Sheedy, Colling. More, if new investigations lead to new convictions, as police think likely. All those girls and women, all victims of Levi Bellfield, all victims of a common crime that will not end until we pull the pieces together, and realise that the torture, the stalking, the kidnaps, the rapes, the killing and the maiming – all of them are connected by the same vicious logic of gender. Then, and only then, will be able to tell a different story. Then we will have a beginning.

Sarah Ditum is a journalist who writes regularly for the Guardian, New Statesman and others. Her website is here.