“Floating the Egyptian pound is an expression I have been hearing often during the past few weeks. I do not grasp exactly what it means on the economic level, but from what I hear and read I realise it is sure to lead to a crisis, to an unprecedented leap in prices,” a young woman, Monica Fahmy, told Watani.
With economic reform badly needed to rescue the ailing Egyptian economy, the government has been strongly hinting it would have to take a decision to float the Egyptian pound some time in the near future. Even though Egyptians realise they will have to endure austerity if the country is ever to emerge from the dark tunnel of economic decline, they are very worried about the expected decision to float the pound. Prices have been spiralling since the 2011 Arab Spring and the subsequent economic downturn but, lately, the price spiral has almost gone out of all control. Add to that the ‘threat’ of floating the pound, and the public is anxious, worried, and confused.
Watani was keen to sound young Egyptians on the matter.
Dark, hard days ahead
“Most people have no idea what ‘floating the pound’ means,” Mona Adel, a teacher, noted. “But the public is divided; some trust the government’s decision and believe it ultimately works for our benefit; whereas others have no confidence in the government and are very wary of floating the pound.”
A number of young people, among them Hassan Ali, Peter Magdy and Wissam Abdel-Hadi, agreed that they were unfamiliar with the term ‘floating the Egyptian pound’. “People are confused,” Ali said. “We do not understand the term, let alone its advantages or disadvantages. But whoever wishes to understand will find substantial material on the Internet. Most people, however, appear not to care—at least, for the moment. Once the pound is floated they will have to care.”
Taxi driver Ahmed Ali, is another Egyptian who admits, rather bitterly, that he knows nothing about what ‘floating the pound’ means. “But,” he says, “we are about to live through some dark, hard days. That much I know. Today, we do not have enough pounds to go around, so what will it be like once the pound is floated?”
Abu-Ahmed, a bakery worker, believes it is the government’s job to assess the full scale of the economic problem and decide on the best ways to tackle them. “If floating the pound is one of them, I guess we’ll just have to manage. Our parents say they lived through difficult days of real austerity, maybe it’s our turn now.”
People live anyway
“I had no idea what ‘floating the pound meant,” Samira Ahmed, a young mother told Watani. “So I kept asking until I realised that the Central Bank would no longer set a price for the dollar against the pound, but would leave it to supply and demand.”
Hany Magdy would give no opinion. “I don’t talk politics,” he said. “Even if we understand what floating the pound means, it would make no difference. People live anyway.”
Watani approached students of the Faculty of Commerce, seeing they must be aware of the full scale of floating the pound. Ahmed Essam said that floating the Egyptian pound is a sovereign decision taken by the government to the country’s advantage since the Egyptian pound has lost much of its value against foreign currencies. The decision will be for the benefit of the Egyptian economy in the long term, Essam said.
Another commerce student, Bishoi Gameel, agreed with Essam, “this would ultimately increase the Egyptian pound’s value, which means that the Egyptian economy would emerge out of the doldrums and become attractive to investors.”
19 October 2016