November 10, 1986
By James Phillips
t 54 6 November 10, 1986 OPTIONS FOR THE U.S AS EGYPT'S TIME OF
RECKONING NEARS INTRODUCTION America's foremost friend in the Arab
world is in increasing difficulty threatens to shatter that
nation's fragile social peace and alter its political ori entation
For too many years Cairo has postponed sorely needed structural
economic reforms by drawing on the financial bonanza of its Camp
David ''peace dividends" (the Sinai oilfields, Western aid and
tourism) and by tapping into the Persian Gulf oil boom through the
remittances of over two million expatriate workers. But with the
decline of oil prices, tens of thousands of Egyptian workers have
returned from abroad, depriving Cairo of much of the foreign
exchange it needs to finance its 37 billion foreign debt and
chronic balance-of-trade deficit Confronting Egypt is a festering
economic crisis that By late this year or early next, Egypt's time
of reckoning will arrive.
If it cannot borrow new funds, Egypt will be confronted with.the
stark choice of defaulting on its foreign debt or risking political
turmoil by cutting imports The country's foreign currency reserves
will be exhausted.
Hosni Mubarak, who became Egyptian President after Anwar Sadat
was assassinated in 1981, has appealed to the United States and
other Western nations to ease Egypt's cash crisis by helping it
make up a foreign exchange shortfal1,of up to $5 billion in the
Though the U.S. is giving Egypt $2.5 billion aid this year,
Cairo seeks more next year, plus greater flexibili ty in the form
of cash grants and cooperation in renegotiating the terms of
outstanding loans. Washington can help ameliorate Egypt's
short-term financial crisis. Only Cairo, however, can solve Egypt's
long-term economic problems. The Mubarak government h a s made
half-hearted efforts at piecemeal reform but has been reluctant to
overhaul the flawed core of Egypts archaic socialist economy-the
labyrinthine bureaucracy that administers the lumbering public
sector and consumer subsidies. The government has bor r owed
heavily from abroad to maintain the costly subsidy system to
forestall social turbulence and coopt political opposition. Yet
Egypt sdeteriiirating economy, increasingly burdensome debt, and
growing dependence on the West have fueled Islamic fundament alism
and raised the risks of a radical fundamentalist backlash.
Egypts experiment with democracy but could destabilize the
Middle East by unraveling the U.S.-engineered Camp David agreements
Such a convulsion not only might sweep away To assure the surviv al
of a stable, pro-Western Egypt, the U.S must help Egypt to cushion
its poor while undertaking the kind of radical overhaul of its
economy that will offer Egyptians hope for the future. Washington
should ease Egypts immediate cash crisis--but only if Ca i ro makes
a long-term commitment to restructure its econhy to promote growth
and productivity and reduce waste U.S. aid will be wasted unless
Egypt puts its house in order 0 0 0 0 0 0 The U.S. should encourage
Egypt to Bolster the private sector by reducin g bureaucratic red
tape artificial foreign exchange rates, and obstructive licensing
Gradually eliminate price controls and move toward a free market
economy Trim consumer subsidies that distort economic behavior,
limiting them to those consumers with a genuine need for state
Replace Egypts import substitution orientation with an export
orientation by developing labor intensive industries in which Egypt
has a competitive advantage.
Privatize state-run enterprises to prevent the huge public
sector from choking out infant private sector enterprises.
Encourage private investment by Egyptian and foreign investors
by giving potential investors concrete assurances against future
nationali zations 2EGYPT'S ECONOMIC TROUBLES Egyptian Prime
Minister Ali Lutfi concisely defined Egypt's economic problem as
Ilconsuming more than we produce, importing more than we export
and. spending more than we receive It Cairo I s economic
difficulties are to a large degree a legacy of Gama1 Abdul Nasser,
who headed Egypt from 1952 to 1970 overcentralization,
inefficiency, waste, and corruption. The nationalization of
foreign-owned enterprises in 1956 deprived Egypt of foreign
investment, while nationalization of domestic enterprises after
1960 spurred capital flight and an exodus of talented managers and
other professionals. A cumbersome bureaucracy grew to oversee a
swollen public sector plagued by obsolescent equipment, low
productivity, and lack of competit i on. For political reasons,
Nasser directed trade to favor the Soviet bloc and erected tariff
barriers and other import restrictions on western trade. Finally,
Nasser's belligerence provoked 'the 1967 Arab-Israeli war, which
left Israeli forces in possessi on of the Sinai, depriving Egypt of
revenues from the Suez Canal and Sinai oil fields His socialist
policies bred Anwar Sadat, who became President after Nasserls
death, sought to revive the failing statist economy by unleashing
the private sector.
He laun ched his Infitah (Open Door) policy in 1974 to open
Egypt to Western trade, technology, and investment. Central to his
vision was the hope of combining Arab oil money, Western know-how,
and Egyptian labor to modernize the moribund economy bureaucratic
imp ediments to growth in the private sector and liberalized the
tax and tariff systems to encourage foreign economic
Infitah successfully lured large capital inflows into the
country but failed to harness them productively from the policyls
int ent, Law 32 of 1977 altered the professed goal of
liberalization from export encouragement to import substitution.
Much of the foreign investment flowed into financial services,
tourist enterprises, and real estate rather than productive
investments in in d ustry and agriculture. Though Egypt's gross
domestic product (GDP grew at an impressive annual rate of over 9
percent from 1974 to 1981 this was not accompanied by real economic
development. Instead an outburst of consumerism enriched traders
who channele d profits into speculative investments or shifted
money abroad. Sadat was criticized Egypt reduced the In a major
retreat 1. Financial Times (London June 4, 1986, p 21 3 I for
transforming Egypt "from a planned market economy into a
supermarket economy I2 W hen Hosni Mubarak came to power, in 1981,
he inherited a mixed economy in which a dominant public sector
coexisted uneasilv with a small but increasingly vibrant private
sector created a schizoid economic system with independent
capitalist and Sadat s Inf i tah had collectivist subsystems
functloning in an unhtegrated:manner 8 Despite the failure of
Nasser's socialism to maintain economic growth and the inability of
Sadat's liberalization to provide development with growth,
President Mubarak has retained bot h with minor variations.
Consequently, Egypt has been hobbled by chronic balance-of-payment
deficits and a deepening dependence on Western aid.
THE IMMEDIATE CRISIS The Egyptian economy has been buffeted by
exogenous factors beyond Cairo's control. Egypt h as been one of
the countries hardest hit by falling oil.prices Egyptian oil export
revenues $his year are expected to plummet 50 percent or $1.1
billion from 19
85. More important, remittancef from the 2.7 million Egyptians
working in the oil rich Arab st ates, which already had slumped
from $4 billion in 1984 to 3.7 billign in 1985, are expected to
fall by another $1 billion this year. As Persian Gulf states
strive.to. export the brunt of the oil recession by expelling
foreign workers, Egypt will lose an important safety valve that
defused social tensions and gave poor Egyptians hope for a better
standard of living.
Tourism also has fallen. Here the culprit is terrorism.
Airplane hijackings and the Achille Lauro incident have
discouraged travel to the Mid dle East. The 1985 massacre of
Israeli tourists on a Sinai beach by a deranged Egyptian policeman
and the bloody February 1986 uprising of Egypt's riot police have
raised anxiety over the safety of tourists in Egypt. As a result,
revenues from tourism, es t imated at almost $1 billion last year,
could be 2. Mohammed Heikal, Autumn of Furv (London: Deutsch,
1983), p. 86 3. The Wall Street Jou rnal, June 23, 1986 p. 24 4. In
1985, there were an estimated 1.25 million Egyptians in Iraq,
800,000 in Saudi Arabia, 300,OO in Libya, 200,000 in Kuwait, and
150,000 in the United Arab Emirates guarterlv Economic Review: ERVD
t, 1985 Annual Supplement, Economist Intelligence Unit London, p 9
5. The Wall Street Jou rnal, February 27, 1986 4halved from $9.6
billion in 1985 . to $6.6 billion in 1986.
By one estimate, total foreign exchange egrnings will shrink
Even before its sources of foreign exchange began to dry up Egypt
was burdened with a crushing debt service ratio-35 percent of
current account inflows immediately flow out again to pay the
interest on the f rei n debt. Egypt's national debt is estimated to
be $37 billion,? w?th.-$6.8 billion owed to the U.S its single
largest creditor. The International Monetary Fund (IMF) estimates
that Egypt's debt repayment obligati o n will be $3.7 billion this
year up from $3 3 billion' in 1985 I In addition to servicing the
national debt, Cairo must finance a trade deficit that grew from
approximately $6 billion in Egyptian fiscal year 1984/1985 (ending
June 30) to $7 billion in 198 5/1986 To finance this gap without
reneging on its foreign debt obligations Egypt mustlomake up a
projected shortfall of up to $5 billion in 1986/19
87. If it cannot do so, Cairo will have to choose between
slashing imports or defaulting on its foreign deb t. The first
option might spark an uprising by poor Egyptians dependent on
subsidized food imports; the second would vitiate prospects of
securing future loans.
To escape this dilemma, the Mubarak regime is lobbying Western
governments to step up economic aid and ease the terms of debt
repayment. This May, Cairo appealed to the seven nations attending
the economic summit in Tokyo to establish a $30 billion Middle East
development fund to assist states hurt by the oil glut negotiations
with the IMF for a $ 1 billion standby loan and hopes for up to
$800 million from the World Bank toured West Germany, France,
Britain, and Italy in search of more aid and requested European
help in convincing the IMF to make a loan without repiring Egypt to
pare its budget def icit by cutting subsidies.
Washington seeking assistance in scraping up enough cash to
avoid the clutches of the IMF. High on their list is the reduction
of interest rates on the $4.5 billion Egypt has borrowed from the
U.S. for Egypt entered In July Presi dent Mubarak A steady stream
of Egyptian officials have visited 6. Paul Jabber Egypt's Crisis,
America's Dilemma ffairs. Summer 1986, p 961 7. The Wall Street Jou
r na 1 November 4, 1986, p. 38 8. The New York Times, August 23,
1986 9. MJg m' D' Special R e port: Egypt, June 1986, p. 8 10.
Financial Time3 (London June 4, 1986, p. 21 11. The Wall Street Jou
rnal, July 30, 1986 5military purchases grant portion of the U.S.
aid program. In FY 1985 115 million of the 2.48 billion U.S. aid
program was disbursed i n the form of a cash grant.
Egyptians have grown addicted to massive consumer subsidies that
have draine'd the government treasury and warped economic
Subsidies on food; kclothing and energy: cost .thelbstate 1'
billion per year, soaking up about one third of the national
budget. A loaf of bread costs the government four times as much to
produce as it is sold for, and until recently gasoline cost less t
han bottled water.
Such artificially low prices ease the immediate plight of the
urban poor but distort the economy and create tremendous waste.
Egyptian farmers, for instance, are known to feed subsidized bread
to livestock because it is cheaper than anim al feed. Because
heavily subsidized government flour depresses domestic wheat
prices, locally grown wheat is sometimes more vakuable as a source
of straw for making bricks than as a source of food estimated to be
lost through sloppy handling. Practices su ch as these make Egypt
the worldls foremost per capita consumer of grain.
Since 75 percent of the grain Egypt consumes is imported from
abroad Egypt is forced to go deeper into debt to underwrite grain
imports that it does not really need.
In effect, Cair o is mortgaging its future to sustain wasteful
Cairo also wants Washington to boost the cash More than one-third
of aomestic crops is current consumption patterns is an
economically suicidal act. Although consumption subsidies The
existing system of price controls contribute to political stability
in the-short run by easing the plight of the urban poor, in the
long run such subsidies threaten Egypt's political stability by
sapping the vitality of the economy.
In the long run, the urban poor will have to be ar an even
heavier burden THE NEED FOR ECONOMIC REFORM Mubarakls first speech
after assuming power recognized that his governmentls success would
depend on its economic record initially distanced himself from the
excesses of Sadat's economic scheme by mou n ting an anticorruption
drive against businessmen who had exploited political ties to cash
in on Infitah He Mubarak called for a 12. The Washington Post June
26, 1986, p. A36 13. Marvin Weinbaum, "Dependent Development and
U.S. Economic Aid to Egypt Intern a tional Journal of Middle
Eastern Studies, May 1986, p. 122 14 The New York Times, August 23,
1986 6shift from Sadat's Ilconsumptive open door," which encouraged
luxury imports, banking, and real estate speculation, toward a
''productive open door to promo t e domestic industry and
agriculture. He endorsed the concept of "guided capitalism,Il in
which the state sets goals and coordinates the different sectors of
a mixed economy political pyrotechnics, of the Sadat era.!
But-while Mubarak reversed Sadat's 1981 crackdown in the political
sphere, he failed to follow through on long overdue economic
reforms. A decent and honest man Mubarak lacks the personal
charisma and decisiveness that Egyptian political culture extolls.
A sense of drift.has pervaded economic p o licy making, as the
government has tried to defer hard choices by propping up the
faltering economy with foreign assistance Mubarak's cautious
pragmatism has been soothing after the Cairo has tinkered with
marginal reforms but has not come to A patchwork o f ad grips with
the heart of its problem--the subsidy system that skews economic
behavior by distorting price signals hoc price hikes has been
fashioned, often by stealth, to defuse opposition. Example: The
price and size of a subsidized loaf of bread wer e doubled, then
the size and quality gradually were reduced, while the price
remained.at the higher level subsidies, however, provoked riots by
industrial workers near Alexandria in October 1984, inducing the
government to roll back some of its belt-tighte ning decrees.
Further austerity measures were shelved for.severa1 months, but
Egypt's deepening economic malaise prompted Mubarak to appoint Ali
Lutfi, an advocate of reform, as Prime Minister in September 19
85. A former finance minister, Lutfi recognize d the burden
posed by subsidies but also realized that the government could not
cancel the subsidies outright, thereby abruptly abandoning the
implicit social contract that Nasser had extended to Egypt's poor.
Lutfi proposed that subsidies be reduced grad u ally over five
years, while the salaries of &he poor, many of whom held
low-paying government jobs were raised. He also called for the
strengthening of the private sector to boost exports and domestic
food production because of divisions in the cabinet. H e is a
technocrat without a political base, whereas other cabinet
ministers seem determined to protect their public sector
constituencies has introduced reforms that expand the role of the
private sector such as Decree 121 early this year that allowed priv
a te firms to import and market foods previously reserved for
state-run enterprises. This April, the cabinet approved a draft
budget that included modest cost-,cutting and revenue-raiking I'
measures. The Cautious attempts to trim Lutfi has not been able to
carry out his reforms, however The government gingerly I 1 IS. The
Wall Street Journal, October 9, 1985, p. 36 7government claims that
the new budget scales back 15 percent, but since Egypt frequently
overspends savings probably will be elusive.
This June , the' Egyptian finance and planning subsidies by
almost its budget, such ministers came to Washington with further
proposals. for cutting suhidies, streamlining the state
bureaucracy, and raising energy prices. The Reagan Administration
is pressing- for a ?-more detailed.'$rogram of pricing reforms on
tighter deadlines direction, but hesitantly, for fear that
wrenching austerity measures will ignite discontent, which Muslim
fundamentalist extremists are poised to exploit Cairo appears to be
moving in the r i ght THE SPECTER OF ISLAMIC FUNDAMENTALISM The
Egyptian government must face as well the growing challenge of
Moslem fundamentalists, who seek to remold Egyptian society along
Islamic lines through the establishment of.Islamic law (sharia).
The Moslem Brot h erhood, outlawed since a 1954 assassination
attempt on Nasser, exerts a deepening influence on Egyptian
political parties and the state bureaucracy. Radical
fundamentalists in loosely organized Islamic associations-the
gamaat Islamiya-have seized control o f student unions and faculty
clubs. Unlike the Moslem Brotherhood which currently sees the
Egyptian parliament as a legitimate means of reforming society,
many members of the gamaat Islamiya seek revolutionary change
through violence. Although Islamic rad i cals probably number no
more than 10,000 activists, they form an underground network that
continues to gain strength world rail against adoption of Western
values, secularism materialism, and corruption. In Egypt's case,
the fundamentalists include the Ca m p David peace treaty and
dependence on the West. They advocate a return to an idealized form
of Islam, which they claim will remedy Egypt's social, economic,
and political problems. Their ranks are fed by the steady influx of
rural migrants ,into the citi es and by Egypt's educated youth,
disillusioned with their bleak economic future yearning for
reassurance and stability in a rapidly changing society.
In a crisis, such yearnings for simple answers to Egypt's
formidable problems could be manipulated by Isl amic radicals and
channel'ed into an attack on the government Islamic fundamentalists
in Egypt as elsewhere in the Islamic The rise of fundamentalism
reflects a widespread popular In the early 19708, President Sadat
tacitly encouraged fundamentalists to c o unterbalance Egyptian
leftists, but cracked,down on them in his last months in power.
Mubarak, who was standing beside Sadat when Sadat was assassinated
by radical Moslem fundamentalists in 1981, has continued cracking
down on the radicals while trying to establish a dialogue with
moderate fundamentalists. This has avoided 8 the pitfall of pushing
disaffected Egyptians into the arms of Moslem extremists, but there
is a danger that the government's tolerance could be mistaken for
weakness Egypt is not Iran. There is little chance that an
Iranian-style Islamic revolution will topple the government.
Muhammed Reza Pahlevi, Mubarak is respected by his people as an
honest leader who abhors cor.ruption UnlikebIran; whose independent
Shiite clergy was troubled theo logically by the legitimacy of
secular authority, Egypt is a predominantly Sunni (orthodox) Moslem
nation whose top religious leadership is supported by the state
fundamentalist opposition is divided, and there is no charismatic
figure on the horizon such as Iran's Ayatollah Khomeini to unify
Egypt, which poses a countervailing force to the Moslem
Nevertheless, Moslem fundamentalism continues to make inroads
particularly among the young. And the Egyptian army, long the
backbone of the state, has not remained immune. If fundamentalists
come to power in Egypt, it is likely to be through the army, rather
than against it Unlike Iran's Shah Egypt's There also is a large
Coptic Christian minority in EGYPT'S CHALLENGE TO THE REAGAN AD
MINISTRATION Cairo has made strong political and strategic
arguments that it deserves special consideration and help to avert
a financial crisis.
Egypt is the most populous Arab state; it sits astride the land
route between two continents and controls the Suez Canal linking
the oil-rich Persian Gulf to the West. Egypt buttresses U.S.
defense policy through strategic cooperation that enhances American
ability to respond to a Persian Gulf crisis, and it contributes to
U.S. Middle East diplomacy by supporting the expansion of the Camp
Finally, Egypt is an embryonic democracy that faces the internal
challenge of radical Islamic fundamentalism. For all these reasons
Egypt merits U.*S. help.
Washington must address Egypt's long-term economic problems, not
A U.S. cash transfusion would bleed. just its short-term cash
crisis rapidly through the twin.hemorrhages of Egypt's trade and
budget deficits. It only would postpone economic collapse unles s
Egypt instituted sweeping reforms long-term economic predicament.
To be sure Washington should help Cairo relieve this symptom, but
it should do so with the intention of administering a final cure.
Washington has poured $20.3 billion in assistance into E gypt since
1974, yet Egypt remains in economic distress Egypt's impending cash
crisis is a symp.tom, not a cause, of its A case can be made that
aid even might be 9counterproductive if it sedates Cairo's sense of
urgency in undertaking reforms.
Washington' s help in easing Cairo's cash crisis should be
linked to an Egyptian commitment to overhauling its economy. Only
internal reforms, not external aid, can resolve Egypt's
difficulties. At best U.S. aid can provide a cushion to ease the
transition to a syste m in which market forces stimulate
growth;.'enhance-productivity, and reduce waste.
Short-Term Assistance U.S. aid to Egypt in fiscal year 1985
totaled $2.48 billion including a $250 million emergency grant
pushed through Congr,ess in conjunction with emer gency aid to
Israel parity with Israel, particularly in receiving more of their
aid in the form of cash grants.
Reagan Administration from even considering more aid to Egypt, a
greater share of current aid could be given as cash grants rather
than project aid U.S. funds however, that this restructured U.S.
aid depends on Egyptian commitment to basic economic reforms The
Egyptians seek'aid While federal budget constraints prevent the
This would give Egypt more flexibility in spending the The Reagan
Adminis t ration should make it clear to Cairo Egypt has requested
relief from the interest rates that it pays on its $4.55 billion
military loans from the U.S. Accumulated from 1977 to 1984 under
the Foreign Military Sales (FMS) program, this debt carries
interest rates of 12 to 14 percent reflecting the high interest
rates of those years years, with the first ten years constituting a
grace period in which only interest is paid an all-grant basis
since 1985, Egypt owes $555 million in 1986.to cover interest and a
4 percent penalty on overdue payments. Egypt chronically has missed
deadlines on repayment and is in danger of triggering the Brooke
Amendment, which requires all U.S. aid to be frozen to any aid
recipient in arrears for twelve months or more These FMS loan s are
repayable over 30 Although the FMS program has been operated on
Washington has resisted renegotiating Egypt's FMS debt because
doing so would open a Pandora's box of problems 18 billion of
outstanding FMS loans to various countries. A renegotiation o f
Egypt's loans would lead other borrowers to seek similar treatment.
Another option would be to refinance Egypt's FMS debts through
commercial banks. This would lower Cairo's debt burden by taking
advantage of today's lower interest rates reportedly is le a ding
discussions about lending Egypt the money to pay off its FMS loans.
But any such deal probably would be contingent on U.S. government
loan guarantees. This creates enormous problems because it would
invite pressures for U.S. government loan guarantee s of huge Third
World debts to U.S. banks. If no other solution is possible, it
would be preferable to renegotiate Egypt's FMS loans rather than
give loan guarantees There are more than Bankers Trust The scale of
any debt relief plan 10 -should be calibrat ed to match the 'scope
of Egypt's implementation of economic reform.
Another possibility for resolving Egypt's overall foreign debt
problem would be a debt/equity swap. Egypt could, in effect, sell
public sector enterprises to foreign creditors, who would accept a
share of ownership in newly privatized firms in return for retiring
Egypt's debt. Debt/equityrswaps are an:hcreasingby promising 'means
of dealing with Third World debt. Although Egypt may be sensitive
about comparisons to the 1875 British purcha se of Egyptian shares
in the Suez Canal, this option merits consideration.
Loncr-Term Policv U.S. assistance will be wasted unless Egypt
puts its house in order by making structural economic reforms 0 0 0
0 0 Egypt should move toward a free market .economy to improve its
balance of trade and spark economic growth be realigned more
closely to world prices to minimize waste and enhance efficiency
should be.lifted to give farmers maximum incentive to raise
Egypt should limit consumer subsidies to those with a genuine
need for them. The U.S moreover, should press Egypt to follow
through on Prime Minister Lutfi's goal of raising salaries and
cutting subsidies gradually.
Egypt should move from a strategy of import substitution to an
export orientatio n by developing labor intensive industries in
which it has a comparative economic advantage establishment of a
General Motors automobile assembly plant is an important test case
that could become the wave of the future.
The government should bolster the p rivate sector'by privatizing
public sector enterprises and streamlining bureaucratic procedures
Domestic prices must Price controls on agricultural products The
recent Investment should be encouraged by giving potential
investors concrete assurances again s t future nationalizations.
Because of Nasser's nationalizations, Egyptian investors, for good
reason have neglected long-term capital investment in favor of
'quick capital gains. By constructing a free market economy, Cairo
can tap into billions of dollar s of savings that Egyptians have
hidden from the government.
Washington could purchase Egyptian oil for use in the Strategic
Petroleum Reserve whenever possible, as..it also is doing for
hard-pressed Mexico. The U.S. also should urge its European allies
to substitute Egyptian oil for Libyan oil i I 11 0 0 0 Washington
should reduce the visibility of its official presence in Egypt. The
U.S. Embassy in Cairo is now the largest American embassy anywhere
lightning rod 'for Muslim fundamentalists and further st r ains
Washington must encourage Japan and Western Europe to increase aid
to Egypt:..iJapan and Western Europe shouldhifurther reward Egypt
for making peace with Israel. Extensive Japanese and West European
dependence on Middle Eastern oil makes their econo m ic stake in
Middle East stability equal to, if not greater than that of the U.S
A high American profile is a too convenient bilateral
Egyptian-American relations I The U.S. must work to broaden the
Camp David accords to include responsible Palestinians an d
receptive Arab states This not only will reduce Egyptian
fundamentalists' ability to exploit the issue of a "separate
peacell with Israel, but will maximize Egypt's opportunity to play
a stabilizing regional role.
CONCLUSION Because a significant boost i n U.S. aid is precluded
by Gramm-Rudman constraints on the federal budget, Washington
cannot unilaterally rescue Egypt. But actually this is a blessing.
A U.S bailout would only postpone Egypt's economic) collapse unless
it were accompanied by a radical o verhaul of Egypt's: sluggish
Washington can help ameliorate Egypt's short-term cash crisis
but only Cairo can resolve Egypt's long-term economic
The U.S. should offer help in reducing Egypt's debt burden but
should tie its aid to an Egyptian commitment to undertaking genuine
James A. Phillips Senior Policy Analyst 12
Senior Research Fellow for Middle Eastern Affairs
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