In Egypt, exaltation in the face of the Turkish currency crisis
CAIRO – Turkey is not Egypt’s biggest trading partner. The Egyptian pound is in no way linked to the Turkish lira.
Nonetheless, the Egyptians have been following Turkey’s currency crisis closely, and there is joy in Egypt to the sharp drop in the exchange rate of the Turkish national currency.
Some people even set up what they called ‘Lira counter‘, a 24-hour measure of the decline in the value of the pound against foreign currencies, including against the Egyptian pound.
“Egyptians are celebrating Turkey’s currency crisis due to Turkey’s negative policies towards Egypt over the past decade,” Mohamed Rabie, international relations researcher at the local think tank, Center, told Al-Monitor. Arabic studies and research.
Turkey and Egypt stand on opposite sides of the ideological spectrum, especially in recent years. The government of Turkish President Recep Tayyip Erdogan has not welcomed the 2013 military-backed uprising in Egypt against Muslim Brotherhood President Mohamed Morsi.
Erdogan also criticized outgoing Egyptian President Abdel Fattah al-Sisi, the army chief who led the military establishment in the uprising against Morsi. Sissi went on to win the first post-Morsi presidential election by a landslide.
But Erdogan has maintained his support for the Muslim Brotherhood in Egypt, attacking Egyptian courts for convicting leaders and members of the Morsi movement.
Egypt banned the movement and its party, closed their offices and seized their funds and assets. The country has also started a regional war against him, seeing him as the mother of all terrorist groups.
“Erdogan was particularly angry with Egypt for suppressing the Muslim Brotherhood,” Muneer Adeeb, an Egyptian writer specializing in Islamism, told Al-Monitor. âThe Muslim Brotherhood was the tool of the Turkish president to revive the Ottoman Empire, not only in Egypt, but also throughout the region.
Turkey has also attempted to undermine Egypt regionally and internationally, including in international forums. He was seeking a foothold in Sudan and Libya, which respectively border southern and western Egypt.
Turkey has also followed what Egyptian analysts described as destabilizing policies in the eastern Mediterranean, a region of growing geostrategic importance for Egypt, given the Arab country’s newfound natural gas wealth.
Rabie said: “These policies were manifested in the 2019 maritime border security and delimitation agreements that the Turkish government signed with Libya as well as in Turkish gas exploration in the eastern Mediterranean.”
Turkey has also offered support to Ethiopia for the construction of a gigantic dam on the Blue Nile, the main tributary of the Nile, which supplies Egypt with more than 90% of its water.
All of this is on the minds of most Egyptians as they follow the Turkish currency crisis. National joy is clear on Social media.
On the streets, some people see the new crisis as a chance for Erdogan to pay for what they describe as the âdamageâ he has caused to Egypt.
“I have followed the Turkish currency crisis from the very beginning,” Sameh Osman, a government official in his 40s, told Al-Monitor. “I expect the value of the Turkish lira to continue to fall over the coming period.”
By bragging about the loss of value of the lira, the Egyptians may think that what is happening is coming back. When Egypt floated its national currency in November 2016, Turkish-backed Muslim Brotherhood activists celebrated the subsequent decline in the value of the Egyptian pound.
The Central Bank of Egypt had to liberalize the pound’s exchange rate to eradicate a then flourishing parallel currency market and restore investor confidence in the national economy.
However, the same move resulted in a significant depreciation of the pound sterling, losing most of its value to foreign currencies, in particular the US dollar, the main currency of trade, import and export in this country. .
According to local economists, the fall in the Turkish lira will benefit the Egyptian economy in many ways.
“Egypt can stand out as an alternative investment destination to Turkey, especially if the currency crisis worsens over the coming period,” Khaled al-Shafie, director of the group told Al-Monitor. local reflection, Capital Center for Studies and Economic Research. . “The expected drop in the value of Turkish products will also benefit the Egyptian industrial sector, which depends in part on imports of raw materials from Turkey.”
Trade between Egypt and Turkey has hardly been affected by strained relations in recent years. The trade was worth $ 4.7 billion last year. Turkish investments in Egypt amount to $ 2.5 billion.
Public elation over the lira’s depreciation also comes as Cairo and Ankara take steps to repair their fences. Government officials from the two countries have met several times over the past few months to explore the way forward.
Reports say Egypt has handed the Turkish side a list of demands, including the suspension of support for the Muslim Brotherhood, an end to media attacks against Egypt and the withdrawal of mercenaries paid by Turkey from Libya.
However, the Egyptians ‘reaction to the currency crisis proves the Egyptians’ memory is strong and ruthless, analysts say, and this can put pressure on the Egyptian government.
âThe problem is that the Egyptians will not agree to a mending of the barriers with Turkey that harms Egyptian interests,â Rabie said. “I fear the government will lose its credibility if it goes ahead with reconciliation.”