TheCairoCalls

Why Would You Want to Hear Yourself Scream, Anyways?

2008-04-27T18:04:00.003-04:00

A New York Times article about noise levels in Cairo. I think they should follow up with an article about whether there is a genetic component to this kind of noise tolerance.
Exhibit number 1: Egyptian hot dog vendors on Fifth Avenue.

It's the Corruption, Stupid

2008-04-27T17:31:00.002-04:00

A very interesting take on the food crisis.
Is it time to flash out betaket el tamween (food rationing license)?

Where We Stand

2008-04-25T19:43:00.002-04:00

I have been doing some research on Millennium Challenge Corporation, a U.S. government owned corporation that allocates development money to a bunch of countries around the world. I fully expected Egypt to be on their list of countries, but it was not. I thought maybe that Egypt (again my only source of information now is Egyptian media) is well beyond the development stage that calls for such petty aid!
Until I saw this page which has their criteria for assigning aid to the countries. It had different metrics, each relying on ratings by independent institutions, and I was, to say the least, appalled. Not because I thought that we were really well developed already, but because of the extent to which we are not.
Here is a run down of some of those indicators:

Civil Liberties and Political Rights: You don't need to be a genius to figure out that these are not our strongest points. But to be categorized behind Mali, Niger, Burkina Faso, and Sierra Leone (with all due respect to them of course) is shocking. Freedom House.
Governess Matters: We score consistently below the 50th percentile (meaning that in every single indicator, including rule of law, at least half the countries in the world are doing better than us) and it is getting worse with time. World Bank Institute.
Inflation. My favorite topic for now. I didn't even bother to look up the data sources. Our Central Bank says it's 15.8%!!!
Economic Freedom. We're the 127th in the world. Financial freedom is 30%! Heritage Foundation.

You can look through the indicators' page for a list of all other indicators.
I suspect that there is nothing there that everybody didn't know in a sort of intuitive sense, but the comparison with some countries which we always considered as way behind us in terms of development is stark to say the least.

The Iron Woes

2008-04-03T18:27:00.008-04:00

**UPDATE: With HRC iron prices at 7000 L.E., I'm not sure this analysis is very valid 5/5/08**

One of the recurring themes of "The Call" had been the skyrocketing iron (steel) prices. Think about it: when had the price of this very industrial commodity become such a popular topic? The answer of course relates to one of the other recurring themes of "The Call"; my need to get married ASAP.
Since every Egyptian family, to the amazement of people from different corners of the world, insist that for somebody to earn the unmatched privilege of marrying their daughter this person has to own (not rent) an apartment (more on that later), steel prices represent more than just an economic factor; they affect Egyptians and Egyptian youth in a very personal manner.

But, to the heck with that, I am just gonna talk business!

Ahmed Ezz bashing had been sort of a national sport, and not without good reasons. His company, Ezz Steel, controls more than 60% of the Egyptian steel market, and he is too close to government to rule out any suspicions of monopolistic practices, or worse. Also, I am probably the last person to defend such a high ranking NDP official. But, the matter (high steel prices) caught my attention, and since, I admit, I had no idea who is right and who is wrong, I decided to run some numbers. Here is what I found out.
Steel prices are actually low in Egypt compared to the rest of the world. Hold on to your guns. Apparently, something called the Hot Rolled Coil (HRC) is the standard benchmark for prices around the world. Here are the HRC prices ($/Tonnes) around the world:

Country	$/Tonnes
Europe	$1,000
USA	$920
South Africa	$880
India	$851
Egypt	$830
Thailand	$826

So, on an absolute scale, steel prices are, as Ezz alleges, actually lower in Egypt than in most of the world. Of course there is the concern that even if steel prices are high everywhere in the world, as a strategic (and matrimonial) commodity, the government should intervene to keep prices low in par with the low wages and living standards in Egypt in general. Fair enough.
I added more factor into the mix; GDP per capita, and plotted that against steel prices, here is what I found (I'm telling you I approached this thing with total neutrality):

In relation to GDP per capita, Egyptians are paying less for steel than Indians, South Africans, and Europeans!
There is also the issue of how an international price isn't applicable, because the prices of inputs (wages, raw materials, etc...) aren't "international". I have minimal understanding of the steel indusrty, but I think that most of the raw materials are imported (I remember Coak Cool from awla a3dady social studies). Also, unless we're willing to stop exporting totally and suffer the repercussions (something I don't support), we can't deviate much from the international prices, which to tell you the truth are very expensive now.
This is, again, a very crude analysis. If there is one thing that can be done, I think this should be allowing freer competition in the steel industry. This would at least ensure a fairer price that would reflect international prices, but at the same time ensure no excessive profits for monopolists.

Wow! Justifying Ahmed Ezz? My 18 years self would have killed me!

He's on to me!

2008-04-02T21:42:00.005-04:00

I talked about the economics of the upcoming strike. Tarek, in all his brilliance, pointed out my intellectual snobbery.

Resources: Egyptian Economic Data

2008-04-02T21:09:00.006-04:00

One of the things that most frustrates me as a budding econophile is the complete lack of information, and raw data, about the Egyptian economy (and a host of other fields). So every once in a while I'll just post a compilation of links to some resources which might come in handy one day.

Central Bank of Egypt: Not the most user friendly site out there, but their statistics and publications pages have some important raw data.
The Economist Country Briefing: The excellent Economist is short on data but long on insightful analysis (their pay site, the EIU Country Data has tonnes of data though.)
Last, but certainly not least, Columbia's amazing library system has an extensive list of online resources about Egypt.

update:

Ministry of Economic Development.

I'll update the list as I come across more resources.

Back to usual programming...

History in the Making

2008-04-01T18:43:00.008-04:00

I would have loved to tell you that I came across these articles, in the tradition of the great scholars of the old days, as I shuffled through the dusty Time archives here in New York. It would have made a much better story than "I stumbled across a link to Time Magazine's digital archive of every article they published from 1923 to today." Not as dramatic. But, its true.
Basically those are extended pieces on Mohamed Naguib in 1952 just after the revolution (blessed movement?, military coup? you pick), and King Farouk in 1951 just before it. They were both featured on the respective covers. I think these are fascinating pieces. The ability to basically go back in time and take a look at what people in a country that (at this time) had almost no interest or preconception about Egypt or Egyptians is just refreshing. Also, the fact that the Time is a weekly magazine makes its articles (especially at these days when news cycles were measured in months) somehow immune to spin and revisionist looks at history. Basically, men el a'7er ya3ni, this is what people thought about the events, and the people at the time.
So, what did they think?
Well, when it comes to the corruption of the royal family and the conditions of average Egyptians before the revolution, Nasser and Co. weren't as disingenuous as I thought they were (not to the same extent at least). Here is how the magazine describes what could have been called "The Two Egypts":

The ancient land of the Pharaohs last week lay drowsily under the parching sun, the Nile Delta a green lifeline beset by the hot brown desert. The river, swollen with the muddy waters from the Sudan and the Ethiopian mountains, as always carried life and hope; as they had for centuries, pregnant peasant women ate mud from its fertile banks, believing that it would make their unborn children strong. Yet even the Nile could not accomplish that miracle. In Egypt, two out of four children die before they are five years old, and the survivors are almost certain to be diseased. In fields which they do not own, 14 million fellahin (70% of Egypt's population) labor over crops whose fruit they will not eat, for wages (average 10¢ a day) which barely keep them alive.
They live in mud huts, sleep on reed mats, dress in rags, eat the bread of the poor (there are two types of bread in Egypt, the good white bread from Egypt's abundant wheat being available only to the rich).
Egypt's ruling class, as stupid, selfish and corrupt as any in the wor,ld, is unconcerned. This summer, as in every summer, the rich fled screeching, scorching Cairo and were relaxing in cool Alexandria or, like their King, on the Riviera. When they return to Cairo later in the fall, their womenfolk diamond-studded and sheathed in Parisian gowns, they will take up life in a small world of their own, which moves between exclusive clubs, theaters and palaces. They own most of Egypt's land, pay ludicrously small taxes.

(Somethings never change, especially the bread bit!)

Somethings were actually much more surprising (or at least unconventional), like for instance Naguib's willing to "settle differences with Israel" (Sigh- they were called "differences"!!)

...Dean Acheson let it be known that the price of U.S. arms aid to Egypt would be 1) Egypt's settling its differences with Israel, and 2) Egypt's joining the Middle Eastern Defense Organization proposed by the British. Naguib might possibly favor both proposals, in private...

The articles are both very highly recommended readings. If only to read such terms as "The Reds", "The desert rats", and "The Gyppos" mentioned in all journalistic seriousness, or to figure out why the Time nicknamed Farouk, the locomotive.

Strike That!

2008-04-01T03:07:00.001-04:00

So, I hear there is a strike coming up soon (on the 6th). Like all things hip and Egyptian, I learned about it through Facebook. I have nothing against that, in fact organizing 48,633 members wouldn't have been conceivable before Facebook. It just rubs my romantic, factory-floor, greasy, angry, strike image the wrong way.
Anyways....
While collective action of this nature is long overdue in Egypt, and "The Calls" are overflowing with bread lines stories to rival those of the good old days of the 70s, something has been bothering me about those strikes.
Namely the apparent relation between those strikes and the alarming rate of inflation (at some places in the world, a 12% inflation rate is called hyperinflation and warrants a genuine state of panic, but this is Egypt we're dealing with): I suspect that those strikes aren't only a result of inflation, but might actually be one of its causes.
To help me demonstrate, I put together this graph on the right. I assumed that the recent wave of strikes started in 2005 with ElMahala workers demonstrations. As you can see, the red line on top represents the Price Index, which is racing upwards. As a result of that, the real wages (the purchasing power of these wages - the blue line) is moving steadily downwards (looks kindda depressing!). This is expected; as prices go up, real wages go down.
The interesting thing however is the turquoise line in between. Wages actually increased! And at a seemingly accelerating rate. So the pressure on government actually worked? Well, if you mean by worked that it convinced them to print more money, then, yeah, it did!
I don't have any concrete information to back my conclusion, and I wouldn't claim that my analysis is conclusive (believe me its not, I have seen drunkards giving more rigorous economic analysis) . But, I think its worth the thought:
What if all the strikes succeed in doing is get the government to print more money to pay the angry mases, and push the inflation further up?
The Call is open...

P.S. I don't in any way, shape or form think that people shouldn't go ahead with the strike, or that it is a useless idea; its not. I just think that this is worth a look, and if this was the case, then maybe we need to define our requests from the government more precisely than just increase wages, instead of just trying each to fool the other!

Prologue (AKA: What the hell is this all about!)

2008-03-31T03:10:00.000-04:00

In less than a year since I moved from the Mother of The World to the Greatest City in The World©, my whole perception of my hometown Cairo, and consequentially its essential representation of Egypt, has morphed into a mere series of headlines attained sporadically through “The Calls.”

Of course, “The Call” is a familiar ritual for every Egyptian expatriate. With the Egyptian newspapers, and their websites, in a permanent freeze (in 8 months of passing by a newsstand that carries Al-Ahram here in New York, I wasn’t once hit by a headline that I couldn’t recall seeing –repeatedly– through the past 15 years), the only sources of information about El-Mahrousa are the emotionally charged, loud (don’t know why!) periodic, usually weekly, calls from family and friends back in Egypt. Between the usual chatter about family and in-laws, you can get a glimpse of life back home, which, let’s face it, doesn’t move that fast to start with.

To review what I knew about life in Egypt during the past year through these calls looks like an exercise in post modern Japanese haiku; totally abstract and bland. 2007-2008 goes something like that:

Gaza border breached,

Strikes everyday,

African Cup picked,

Inflation went up,

and Essam El-Hadry fled.

So, “The Cairo Calls” are actually my attempt to know more about what’s happening back home. I want you to tell me what’s happening, not the other way around. In a way, this is like an analysts’ call; I’ll try to spin something that I know nothing about, and you’ll just ridicule my assessment. I promise you it will be necessarily superficial, uninformed, and grossly oversimplified.

I don’t know why you would even want to read it!