Browse the complete Report on : Egypt Defence and Security Report Q4 2010
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Political risks are rising, and the Israeli flotilla raid has put the Egyptian government under further pressure ahead of the November election. We have revised down our short-term political risk rating from 64.8 to 59.8, as the likelihood of policy shifts (within the constitutional and electoral framework) has increased. We also think that the presidential polls could be brought forward, to get the risks of a difficult transition out of the way and reassure concerned investors.
Public anger towards President Hosni Mubarak and his party continues to grow. News out of Gaza always plays badly for Mubarak, who is considered to be equally responsible (along with Israel) for the blockade of the territory, and the Israeli storming of a Turkish aid ship heading for Gaza (resulting in the deaths of nine people), is no exception. The popular belief appears to be that if Egypt would open its border with Gaza to allow essential goods, aid ships such as the Mavi Marmara would not have to be there in the first place.
Egypt not only keeps its border closed, it has also destroyed many of the tunnels through which the people of Gaza import goods (often with Palestinian smugglers inside). The government fears the influence of Hamas on its own population, as well as the prospect of losing the support of the US by indirectly supporting Hamas (by allowing goods through). However, such is the strength of Egyptian feeling on the Gaza Strip that Mubarak announced the opening of the Rafah border immediately after the flotilla incident.
On the economic front, the latest figures support our view that Egyptian growth will slightly accelerate in FY09/10 to 4.9%, though we maintain that a drop back to 4.8% in FY10/11 is likely as weakening external demand weighs on growth. In 2011, the economy will be held back by relatively low domestic demand compounded by a downturn in demand in Europe, undermining Egyptian exports. Around 70% of Egypt's exports are directed to the eurozone, which for the time being looks unlikely to see a strong recovery in demand, preventing a substantial contribution of trade to headline economic growth. Through 2011-2014 we forecast the growth rate to improve, averaging 5.2%.
Although Egypt lacks a substantial armaments design industry, it remains the most prolific manufacturer of military equipment among Arab states. Egypt has the capability to produce a variety of trainer aircraft, alongside armoured fighting vehicles (AFVs), artillery pieces, surface-to-air missiles (SAMs) and M1A1 Abrams tanks. It is the second-largest recipient of US military aid behind Israel and relies almost exclusively on the superpower for its imports. Egypt’s military manufacturing base benefits from coproduction deals with US multinational firms but a self-sufficient industry remains a distant hope.
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Political risks are rising, and the Israeli flotilla raid has put the Egyptian government under further pressure ahead of the November election. We have revised down our short-term political risk rating from 64.8 to 59.8, as the likelihood of policy shifts (within the constitutional and electoral framework) has increased. We also think that the presidential polls could be brought forward, to get the risks of a difficult transition out of the way and reassure concerned investors.
Public anger towards President Hosni Mubarak and his party continues to grow. News out of Gaza always plays badly for Mubarak, who is considered to be equally responsible (along with Israel) for the blockade of the territory, and the Israeli storming of a Turkish aid ship heading for Gaza (resulting in the deaths of nine people), is no exception. The popular belief appears to be that if Egypt would open its border with Gaza to allow essential goods, aid ships such as the Mavi Marmara would not have to be there in the first place.
Egypt not only keeps its border closed, it has also destroyed many of the tunnels through which the people of Gaza import goods (often with Palestinian smugglers inside). The government fears the influence of Hamas on its own population, as well as the prospect of losing the support of the US by indirectly supporting Hamas (by allowing goods through). However, such is the strength of Egyptian feeling on the Gaza Strip that Mubarak announced the opening of the Rafah border immediately after the flotilla incident.
On the economic front, the latest figures support our view that Egyptian growth will slightly accelerate in FY09/10 to 4.9%, though we maintain that a drop back to 4.8% in FY10/11 is likely as weakening external demand weighs on growth. In 2011, the economy will be held back by relatively low domestic demand compounded by a downturn in demand in Europe, undermining Egyptian exports. Around 70% of Egypt's exports are directed to the eurozone, which for the time being looks unlikely to see a strong recovery in demand, preventing a substantial contribution of trade to headline economic growth. Through 2011-2014 we forecast the growth rate to improve, averaging 5.2%.
Although Egypt lacks a substantial armaments design industry, it remains the most prolific manufacturer of military equipment among Arab states. Egypt has the capability to produce a variety of trainer aircraft, alongside armoured fighting vehicles (AFVs), artillery pieces, surface-to-air missiles (SAMs) and M1A1 Abrams tanks. It is the second-largest recipient of US military aid behind Israel and relies almost exclusively on the superpower for its imports. Egypt’s military manufacturing base benefits from coproduction deals with US multinational firms but a self-sufficient industry remains a distant hope.
About Us
ReportsandReports comprises an online library of 10,000 reports, in-depth market research studies of over 5000
micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.
Contact:
Ms. Sunita
7557 Rambler road,
Suite 727, Dallas, TX 75231
Tel: +1-888-989-8004
http://reportsandreports.blogspot.com/
http://reportsandreports.proarticles.co.uk/
http://reportsnreports.wordpress.com/
