Roundup of Middle East news: Egypt's economy suffers

The execution of an Iranian official raises the prospect of more isolation, the death toll in the occupied West Bank is growing, and Egypt must make difficult economic decisions. Here is Danylo Hawaleshka's roundup for this week.

Certainly, the Egyptian pound has seen better times. The currency's worth relative to the dollar has decreased by over half in less than a year. But the main reason for that is that Egypt has complied with the terms of a $3 billion loan provided by the International Monetary Fund to support the country's economy. The IMF generally advocates reducing government economic interference, which in this case entails allowing the Egyptian pound to fluctuate in accordance with market forces.

Egypt has also agreed to scale down public investment in national initiatives like the construction of the New Administrative Capital and significant armament purchases from Germany and Italy. This is in addition to privatizing state-owned companies, including those owned and run by the military. The value of the pound against the dollar decreased by 10% the day following the IMF pronouncement.

Then there is the inflation rate, which is currently over 20%. Food markets are becoming deserted. Imported goods are hard to find, frozen chicken is running out in supermarkets, and basic items like eggs and cooking oil have risen in price.

Abdel Fattah el-Sisi, the president of Egypt, attributes the conflict in Ukraine. Foreign investors were unable to quickly sell their Egyptian treasury bills in the weeks following the Russian invasion, which resulted in a $20 billion outflow. However, many analysts also hold el-Sisi accountable for years of artificially elevating the value of the Egyptian pound. "They cooked the statistics for too long," one analyst said.