Egypt’s Economic Dilemma: Reliant on Israeli Gas but Seeking Alliances with the Houthis

Egypt is facing an unprecedented crisis as the “Iron Swords” war rages on. The conflict, which involves multiple arenas, has far-reaching consequences beyond the countries directly involved. The Suez Canal, a vital economic lifeline for Egypt, has been severely damaged due to Houthi attacks in the Red Sea. This has resulted in a 64% drop in traffic and a significant loss of revenue for Egypt.

The financial implications of this drop are dire, with Egypt bringing in about 47% less revenue compared to the previous year. To make matters worse, Egypt’s debt crisis continues to grow, with credit rating companies downgrading its credit image due to this crisis and other economic factors. In response to the crisis, Egypt has asked the Houthis to focus their attacks only against Israel. However, the damage to the Suez Canal began when the Houthis targeted nearly all shipping giants.

Egypt’s president Abdel Fattah Al-Sisi is dealing with not only a debt crisis but also rising inflation and a crashing currency. Despite these challenges, he remains committed to finding a solution to the crisis and ensuring that Egypt remains stable and prosperous. As negotiations with the International Monetary Fund continue, it remains uncertain whether additional aid funds will be forthcoming or not.

By Editor

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