On the brink of bankruptcy, President El Sisi continues his project for a new capital, “Sisi City”.

Egypt only secured a last-minute extension of nearly 5 billion euros to avoid bankruptcy, but this came at the cost of a historic hike in interest rates set by Egypt’s central bank and a 38% devaluation of the currency.

Emergency measures to avoid bankruptcy of the country immediately affect the Egyptian population. While two-thirds already live below the poverty line, Egyptians feel suffocated, even more so than yesterday, and all this on the eve of the Ramadan festivities. Concretely, this means that today it is impossible for a family to eat properly even while earning two minimum salaries, around 10,000 pounds, equivalent to 180 euros per month.

The country’s finances are temporarily saved but threats of rebellion persist. Egypt’s economic crisis is deep and structural. The country has been in debt for years and inflation has not fallen below 35%. Authorities know they can no longer count on the country’s three historic sources of income – the Suez Canal, tourism and remittances from the diaspora – as two of these pillars have collapsed in recent years. The Covid crisis and the war in Ukraine have devastated the tourism sector. Before the war, 40% of foreigners visiting Egypt were Ukrainian or Russian. For the Suez Canal, since the beginning of the year, state revenues have dropped by 50% due to Houthi attacks in the Red Sea.

Disillusionment for the President and his pharaonic dreams

This is a very bad start to President El Sisi’s 3rd term and most of all a huge disillusionment. Abdel Fattah’s dreams of developing the country were limitless. Their dreams are now colliding with reality, especially the construction of this new administrative capital, “CC City”, in the desert east of Cairo. This was al-Sisi’s priority objective until then, whatever the cost to the country: “If the price of a country’s progress and prosperity is to deprive us of water or food like others, we shall be thirsty and hungry”, he told an assembly of Egyptian political leaders and businessmen on September 30. It then defended its project for new capital, estimated to be worth 53 billion euros, as it continues to reassess upwards.

In a country teetering on the brink of bankruptcy, such a pharaonic project seems surprising. But certainly, the President can thus protect himself from the consequences of a possible bankruptcy of the country. This analysis has been provided to the journalist by political scientist Maged Mandur The Wall Street Journal : “By settling in the desert, it allows him to create distance between himself and the center of Cairo.A political scientist explains. So if there is a rebellion somewhere, he will be able to suppress it without affecting the central authority, without obstructing it.” So President El Sisi is now engaged in a time trial to finish his castle in the desert, before the inevitable social uprising erupts.