Nearly 640 people are estimated to have been killed in the violent crackdown on supporters of the deposed Muslim Brotherhood government in Egypt. Cities across the country are bracing for more violence today, after the interim government declared a state of emergency and the Brotherhood called for a “Friday of rage” to begin after morning prayers.
Aside from the toll on human life, the recent uprisings have wreaked havoc on an already troubled Egyptian economy. Banks are closed until at least Monday. A General Motors plant in a Cario suburb that employs 1,400 people has closed, and other multinational corporations with operations in Egypt are laying low.
So are multinationals reconsidering future investment in Egypt? Not yet, says Majid Jafar, CEO of Crescent Petroleum, an oil company based in the United Arab Emirates with extensive operations in Egypt. Jafar says his company has been dealing with instability since the fall of Hosni Mubarak’s totalitarian government.
“Over the last five years, we’ve invested one and a half billion U.S. dollars, and we’re the fifth biggest gas producer there,” Jafar says. “Our big issue, since the revolution, for many oil companies there, was receivables — unpaid bills. And the total estimate was in access of $7 – 8 billion for the companies overall.”
Jafar says up until the most recent coup that swept Mohamed Morsi and his Muslim Brotherhood government from power, things had begun to somewhat stabilize due to outside investment from other Arab countries.
“It was felt until recently that the new injection of funds by the Gulf countries had improved the government’s situation and might improve the payables,” says Jafar. “But, obviously, recent events are of concern — and it’s very sad, the loss of life — and we hope for stability and political agreement going forward.”
“What everybody, of course, wants to see is a sense of tolerance and a political agreement of inclusion that leads to stability going forward,” Jafar says. He also has a prescription to ameliorate the instability that has plagued the region since the Arab Spring.
“Above all, what needs to take place is an economic revival,” Jafar says. “The youth unemployment across the country, and across the region, is really what’s driving — in my view — the instability. And the irony is the consequence of the so-called Arab Spring have actually made the causes even worse. And unless something is really done to increase investment and an economic recover that leads to job creation, I think we’re going to continue to instability in many of these countries.”
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