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As Egypt prepares to become a full member of the BRICS group of countries in January, it must be careful not to alienate western investors and financial institutions. Such institutions have helped President Abdel Fattah al-Sisi grow a once-stagnant economy, which could play a pivotal role in the region and internationally as a transport and energy hub.
While Sisi has clear ambitions, his country is presently in the throes of an economic crisis that has seen the Egyptian pound plunging in value against the dollar, in part as a result of IMF-driven devaluations. The president no doubt sees BRICS membership as a means of boosting Egypt’s ailing financial fortunes. He will look to achieve this largely through non-dollar denominated trade with BRICS’ other emerging market powers and soft loans from the bloc’s New Development Bank, which is unlikely to set the tough conditions normally demanded by the IMF or the World Bank.
As Sisi campaigns for elections in December that will almost certainly see him win a third term in office, he needs some quick outright wins to bolster his credibility given high levels of food price inflation, fuelled by the Ukraine war and growing unrest and despondency over his escalating crackdown on dissent. Recent western calls for Egypt to absorb refugees from Gaza could, if Cairo agrees, fuel further unrest, as the country has already taken many asylum seekers from regional conflicts in Syria, Sudan and Tigray.
Read the full article on The Arab Weekly.
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