In January 2011, anti-government protests aimed at forcing President Hosni Mubarak to resign, caused riots and a political crisis across Egypt and the Middle East. Lack of economic progress, high unemployment rates, and young people’s zeal for more opportunities and an escape from poverty, sent thousands of protestors into the major cities of Egypt to demonstrate their anger. As a result, an Egyptian Revolution has begun and is having a wide economic and political impact on local business and global trade, and has propagated various economic and political risks in Egypt, the entire Middle East/North Africa region and to some extent, the rest of the world.
Table of Contents
INTRODUCTION
1 IMPACT ON LOCAL BUSINESS
1.1 LOCAL TOURISM
1.2 LOCAL PROPERTY MARKET
1.3 AUTOMOTIVE INDUSTRY
1.4 BANKING AND LOCAL BUSINESS
1.5 INDUSTRIAL SECTOR
1.6 UNEMPLOYMENT AND ECONOMIC RISK
2 GLOBAL IMPACT ON BUSINESS AND INDUSTRIES
2.1 THE SUEZ CANAL AND OIL
2.2 GLOBAL FOOD TRADE
2.3 COTTON
2.4 TOURISM
2.5 CORPORATE RESPONSIBILTY ON A GLOBAL SCALE
3 POLITICAL INFLUENCES WHICH MAY AFFECT BUSINESSES
3.1 LACK OF SOCIALISM
3.2 SHORT TERM POLITICAL IMPACT
3.3 MEDIUM TERM POLITICAL IMPACT
3.3.1 EGYPT AND THE UNITED STATES
3.3.2 EGYPT AND ISRAEL
3.4 LONG TERM POLITICAL IMPACT
3.4.1 LACK OF EDUCATION AND ENTREPRENEURSHIP
4 IMPACT ON SHAREHOLDER VALUE AND WEALTH OF THE MOST AFFECTED COMPANIES
4.1 EGYPTIAN STOCK MARKET
4.2 INTERNATIONAL STOCK MARKET
4.3 IMPACT ON LARGE COMPANIES
CONCLUSION
Research Objectives and Key Topics
This work examines the economic and political repercussions of the 2011 Egyptian Revolution, specifically analyzing its immediate and long-term impacts on local industries, global supply chains, and international shareholder value.
- Analysis of local sector instability, including tourism, banking, and industrial production.
- Evaluation of global ripple effects on energy markets and international food trade.
- Investigation into political influences, such as the failure of socialism and potential shifts in regional geopolitical alliances.
- Assessment of financial consequences for global corporations and stock market volatility.
Excerpt from the Book
1.1 Local Tourism
Tourism in Egypt represents 11% of the country’s Gross Domestic Product (GDP) and employs 12% of the total Egyptian workforce (Dinar Standard). Since the recent political crisis, foreign governments have declared Egypt unsafe for travellers and nearly one million tourists have abandoned Egypt as a popular tourist destination, costing the country in excess of AU $1 billion in total lost revenue. Egypt’s Red Sea Riviera has also been affected, beaches are deserted and resorts are quiet with staff cuts of up to 50% (Blomfield, 2011). As we have seen in politically chaotic Israel in recent times, when a country relies heavily on tourism, decreases such as these can have profound impact on the country’s economy and create extremely challenging conditions for any improvement.
Summary of Chapters
INTRODUCTION: Provides an overview of the anti-government protests in early 2011 and the resulting political crisis in Egypt and the Middle East.
1 IMPACT ON LOCAL BUSINESS: Examines how the unrest disrupted domestic sectors, including tourism, real estate, banking, and manufacturing.
2 GLOBAL IMPACT ON BUSINESS AND INDUSTRIES: Analyzes the international consequences, focusing on oil prices via the Suez Canal, global food trade, and cotton supply chains.
3 POLITICAL INFLUENCES WHICH MAY AFFECT BUSINESSES: Explores the root causes of the crisis, such as social and economic inequality, and forecasts short- and long-term political shifts.
4 IMPACT ON SHAREHOLDER VALUE AND WEALTH OF THE MOST AFFECTED COMPANIES: Details the financial toll on stock markets and large multinational corporations due to the political instability.
CONCLUSION: Summarizes the current climate of uncertainty and advises businesses to adopt cautious risk assessment strategies until the political situation stabilizes.
Keywords
Egyptian Revolution, Political Crisis, International Business, Tourism, Suez Canal, Global Trade, Stock Market, Economic Risk, Unemployment, Corporate Responsibility, Middle East, Foreign Investment, Political Reform, Entrepreneurship, Supply Chain
Frequently Asked Questions
What is the primary focus of this publication?
This work investigates how the political instability caused by the 2011 Egyptian Revolution has affected domestic industries, global trade routes, and international investment environments.
Which key sectors are analyzed in relation to the Egyptian crisis?
The study covers the tourism industry, the banking sector, the property market, the automotive industry, and the broader industrial sector, among others.
What is the central research question addressed in the book?
The book aims to identify the extent of the economic and political risks posed by the regime transition in Egypt to local, regional, and international business operations.
What research methodology does the author employ?
The author uses a qualitative approach, synthesizing reports from financial news outlets, international organizations, and economic data to evaluate the crisis's impact on business.
What does the main body of the text cover?
It details specific local industry disruptions, the ripple effects on global commodities like oil and cotton, political risks related to regional alliances, and the resulting volatility in shareholder values.
Which keywords best describe the content of the work?
The primary descriptors include the Egyptian Revolution, geopolitical risk, international trade, sector-specific economic impact, and corporate ethics.
How did the closure of the Egyptian banking system affect local commerce?
Banks were closed for an entire week, preventing cash withdrawals and complicating international trade due to the inability to process Letters of Credit, which negatively impacted the import/export industry.
What long-term consequences for entrepreneurship in Egypt are identified?
The author highlights a lack of education and a stagnant infrastructure as major barriers that hinder entrepreneurial innovation, which is vital for long-term economic growth.
How did the global stock market respond to the instability in Egypt?
Global markets, particularly in the US, Australia, and Europe, experienced downward pressure, with specific sectors like financials, technology, and cement producers seeing notable share price drops due to concerns over regional contagion.
- Arbeit zitieren
- Renee Stah (Autor:in), 2011, The effect on international business of the problems in Egypt and the Middle East, München, GRIN Verlag, https://www.grin.com/document/274917
