Egypt: An Ancient Treasure Appreciated
Byron Williams


ECON 210
Professor Leah Norris
April 17, 2015







Byron Williams
Prof. Leah Norris
ECON 210
April 17, 2015
Egypt: An Ancient Treasure Appreciated
When we think about ancient history, Egypt holds some of the most precious artifacts and structures on this entire planet. Pyramids, monuments, and ancient tombs among other things, are flooded throughout this historic area. Egypt is an extremely popular tourist area and it is home to one of the wonders of the ancient world, The Great Pyramid of Giza constructed roughly around 2580 BC. Its national population is 85,895,099 people as of July 2014, making it the third populous country in Africa. Egypt is located in the upper rightmost corner of the continent at 27 00 N, 30 00 E and is considered a part of the ‘Middle East.’ I chose this country because of its richness in ancient history. Egypt played a major role in the biblical story of Moses and his instruction from God to free his people from the clutches of the Pharaoh. The tomb and treasures of King Tutankhamen, as well as the other historic kings and queens like Cleopatra, is what links this land directly to history. The fact that there is tangible, visual evidence of Egypt’s history is what makes this land a historic gem.
Looking at the governmental rule of Egypt, it differs greatly from that the United States. It is conventionally known as the Arab Republic of Egypt and as stated, it is a republic style government. The role of the government was initially along the lines of socialism (near-communism) during the 50s and 60s. The influence of the state was increased to encourage economic development; land reforms controlled how much land families could own while agricultural, financial, commercial sectors of the economy was nationalized by the government. So as the country moved closer to communism with increased government interference, the country’s economy was negatively affected with shortages in investment capital which led to increasing poverty, inflation, and unemployment. This prompted leaders in charge to pass more liberal economic policies such as the reduction of subsidies, getting rid of government controlled prices, and the privatized ownership of once state owned manufacturing and industry. These actions taken resulted in a reduction of inflation (down 20 to 5 percent) and stimulated a recovery during a recession in 1990. However, the economy suffered from slow movement, exports of the country were down, and unemployment was still fairly high at 8 percent. With government influence in the economy still rather heavy, the economic climate of the country hasn’t been very good. The once centralized economy has opened up since new leadership came to power which sought climate reforms to attract nonnative investment and facilitate growth. However poor living conditions remain, limited opportunity for employment is still prominent, and investment as well as exports are still weak. These factors have contributed to public discontent, political unrest, and unfortunately the decline in trade, tourism, and manufacturing.
Issues within society and politics in Egypt have had a negative impact in the shaping of the nation’s economy. Egypt desperately needs some form of a structural stimulus or catalyst to salvage the economy from collapsing under its poor performance over the past two years. Agriculture, manufacturing, and extractive industries have contributed between 15-17 percent each towards the national real GDP since 2011. These percentages could be considered fairly low especially since public consumption has only remained at 40 percent without any recent increases. Egypt experienced a decline in modern manufacturing and services which some would suggest is the result of an economic reversal of development. Referencing to the chart of real GDP growth in Appendix A, the nation experienced substantial growth of GDP in 2011 only to be followed by rapid declination in 2012. Since then Egypt has experienced frail, but steady growth through 2013 and today. This is due to an increase in total consumption of 1.1 percent. The contrasting trends of Egypt’s economy, like the share of total consumption increased to 93 percent of GDP compared to the fall of investment from 22 to 14 percent during the financial global crisis in 2008, are causers of constant recessions and are damaging to long term financial growth. Such trends are expected to continue throughout the fiscal year.
Unemployment rates