Creative Writing – 164
Study the article and post your precis in the comments. Our model summary has been posted underneath.
Egypt drifting towards bankruptcy
Egypt has dug itself a massive hole of debt. On Friday, the International Monetary Fund (IMF) will extend a $3 billion loan to the country, a fourth aid package in six years, as its financial tailspin continues.
The loan, along with billions of dollars in cash inflows from Abu Dhabi and Riyadh, are Band-Aids, experts say, designed to keep the Arab world’s most populous country afloat. Without proper reforms, however, Egypt may never be able to shake off its chronic financial woes and break its growing debt addiction.
In recent months, the Egyptian pound has plummeted, losing 14.5% of its value against the US dollar in October. The prices of vegetables, dairy products and bread skyrocketed. Some families are restricting their diets as their purchasing power shrinks, while others struggle to find imported products once available at their local stores.
In a country with a long history of political tension and a fast-growing population – currently 104 million people – the repercussions of economic pain can be far-reaching. When millions of Egyptian protesters toppled former President Hosni Mubarak during the 2011 Arab Spring, “Bread, freedom and social justice” was among the most popular chants.
Egypt’s main Gulf Arab backers recognize what’s at stake here. Billions of dollars from Abu Dhabi and Riyadh have poured into the Egyptian economy in recent years. Both the United Arab Emirates and Saudi Arabia saw giant windfalls on the back of this year’s high oil prices. They’ve used some of that money to bolster the economies of their allies in the Middle East.
In August, Abu Dhabi Developmental Holding Company (ADQ), one of the emirate’s wealth funds, announced a number of investments in publicly listed companies in Egypt, “building on its long-term commitment to investing in the country’s economic growth through its $20 billion joint strategic investment platform,” it said in a statement.
Saudi Arabia’s Public Investment Fund (PIF) also launched the Saudi Egyptian Investment Company (SEIC) in August, a company dedicated to investments in several vital sectors of the Egyptian economy. SEIC has bought $1.3 billion dollars’ worth of shares in four Egyptian businesses.
Still, the Egyptian economy has struggled to shake off its economic woes. Inflation is at a five-year high, making food and other basic goods unaffordable to tens of millions of vulnerable Egyptians. [384 words]
Model Summary/Precis reduced to one third word
Inexorable decline of Egypt’s finances
Egypt has been going downhill financially. Saudi Arabia, the UAE, and the IMF have injected cash generously into Egypt, but the assistance has had only a palliative effect on the ailing economy enfeebled by deep structural problems, and the military’s overarching influence on governance.
IMF will soon give 3 billion USD, the fourth such loan in last six years. Abu Dhabi and Riyadh have injected billions to build giant infrastructure projects in Egypt, but the country seems not to benefit much. IMF’s pressure on Sisi’s government to reform the economy has met limited success, thanks to the military’s resistance.
Even after President Mubarak’s ouster from office, Egypt still waits for democracy and uplift of the poor. Population is rising rapidly, but, spirally inflation keeps bread unaffordable for the poor. [134 words]