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How Egypt debt and aid impact a society’s overall well-being.

The overall well-being has decreased deeply after 2014 when the US Dollar rate increased from 8 Egyptian pounds to 20 Egyptian Pounds ($1 = 20 EGP). This increase led to many economic problems because Egypt depends on many exports basic items and other products. At the same time, a lot of international companies left the Egyptian market, many local companies stopped produce and expelled employees, and another important income resource such the tourism reduced dramatically.

 

The Egyptian economic dropped in many problems from 2014 to the present. The government has increased dependent on debt and aids. As reported: "Egyptian Prime Minister Mostafa Madbouly announced that Egypt’s external debt had reached a record high of $92.64 billion (36.8 percent of the GDP) as of June 2018, an increase of 17 percent in the course of a single year. External debt is compounded by rising domestic debt, which reached 3.4 trillion Egyptian pounds ($190 billion) as of the end of 2017, a 12 percent increase compared to the previous year. This rapid increase in debt has outstripped GDP growth, making the debt-to-GDP ratio jump from 87.1 percent in 2013 to reach 101.2 percent by the end of 2017" (Carnegie Endowment for international peace, 2018, p.2).

 

In the same time, the Egyptian government invests in non-productive projects such as "new Suez Canal, which cost $8 billion to construct, and the new administrative capital, which is expected to cost $300 billion".(Carnegie Endowment for international peace, 2018, p.4)

 

The world bank keeps up the Egyptian government to stop the support of products to get the loans. The Egyptian government raised the price of Cairo metro tickets from 1 EGP to 7 EGP, trains, solar, almost all products, and still.

All reasons led to the middle-class became lower-class.

 

I observe the widening gap between the rich and the poor is big, the structure of classes in Egypt was (lower, middle, and rich). Today the middle-class are hidden and became the structure of classes in Egypt that are poor and rich. The percent of the middle-class is very little. And it hides day after day.

The average income in the lower- class is $62 in a month while the average income in rich-class is $2600 in a month. That is unfair. And that is one of the reasons for the 25 January revolution. 

While the poor- class live in slums and has limited public services, the rich-class live in high-end places and all public and private services are available dramatically.          

 

References

Carnegie Endowment for international peace. (2018, November 20). Sisi’s Debt Crisis. Retrieved from https://carnegieendowment.org/sada/77756


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