President Sissi’s Egypt trapped in inextricable crises

Sylvain Cypel. — Donald Trump is asking Abdelfattah Sissi to take in a massive number of Palestinians from Gaza? The American press recently referred to possible pressure from Trump on Sissi concerning the Ethiopian Renaissance Grand Dam on the Nile, which threatens to reduce Egypt’s access to water. Do you think the Egyptian president may eventually give in to American pressure over the future of the Palestinians ?

Robert Springborg. – From photographic evidence of the Sinai it was clear that several months into the war on Gaza Egypt was preparing a large “camp” to receive expelled Palestinians, presumably in response to pressure on Sisi from the Biden Administration. After this evidence became public further development of that camp was halted. This suggests that pressure was brought on Sisi to back away from the plan, pressure presumably exerted by the only force that has any leverage in today’s Egypt, i.e. the military.

The Trump Administration has now upped the ante, offering Egypt support, including but probably not limited to its conflict with Ethiopia over the dam. But in the meantime the revulsion in Egypt and much of the world against Israel’s destruction of Gaza has made any compromise by Sisi much more difficult, as evidenced by the regime’s greater indulgence of protests against Israeli actions.

THE DILEMMAS OF THE WAR ON GAZA

Nevertheless, one can imagine a scenario in which displacement of at least some Gazan Palestinians into Egypt becomes viewed as a component of a larger package of deals that ends Israel’s present engagement in Gaza. In this case Sisi would obtain American support against Ethiopia and a continuation of its foreign assistance from Washington, which would in turn cause the Egyptian military to look more favorably on the deal. And being accompanied with say a return of the Palestine Authority to some role in Gaza, plus Arab and international support for rebuilding Gaza as well as providing security, would reduce the salience of Egypt accepting Gazans. This would provide Netanyahu with some claim to “victory” by virtue of expelling Palestinians.

In sum, the situation is fluid and it is possible to imagine conditions that will cause Egypt to give in to American/Israeli pressure.

DIVISIONS BETWEEN HAVES AND HAVE-NOTS

S.C.– What is the real state of Egyptian society ten years after Abdelfattah Sissi came to power?

R. S.— The policies of the Sisi regime have further bifurcated Egyptian society between the haves and the have nots. This bifurcation takes several forms. First, wages have not kept pace with inflation, so families dependent upon paid labor have seen their real incomes substantially reduced. Second, inflation has been higher for basic necessities than for other goods and services, especially for foodstuffs. Third, public services, especially in health care and education, have been scaled back, forcing users to turn to private suppliers. Fourth, employment in the civil service as a proportion of total employment has declined, thereby affecting women and the lower middle class who traditionally have been more dependent on public sector employment.

Finally, on the other end of the social spectrum, those with access to capital whether through private sector employment or business ownership, or remittances, or various forms of corruption, have seen their relative incomes soar, so have indulged in conspicuous consumption, especially in housing and upmarket services. So the bottom has declined while the top has risen, expanding the income/welfare gap which was already substantial. Indeed, according to the Gini Index of Inequality¹, as reported by Thomas Piketty, Egypt among lower middle and middle income countries is about the most unequal. This profound inequality has greatly exacerbated socio-political tensions, of which a plethora of strikes impacting large enterprises is but one indicator.

A MILITARY-CONTROLLED ECONOMY

S.C.– International Monetary Fund (IMF) and European support for Egypt continues. Recently, EU President Ursula Van der Leyen sang the praises of reforms that are virtually non-existent². How do you explain this ?

R. S.—The IMF, the EU and almost all of its member states have given up on liberalizing reforms in Egypt, whether political or even economic, as evidenced by the massive bailouts provided in the spring of 2024. Support for Egypt results from fear, not from hope. The fear is the consequences of collapse of Sisi’s dictatorial regime, which would likely unleash a host of challenges, whether in the form of trans-Mediterranean migration, terrorism, antagonism toward Israel, linkages with destabilizing forces in the bordering countries of Libya and Sudan, or others. Too big to fail in the minds of these decision makers, they systematically gloss over Sisi’s human rights abuses, his ever tightening authoritarianism, his wanton disregard of reforms agreed with the IMF and other donors, his cozying up to Putin and the Chinese, and so on. That western populations have not objected more forcefully and continuously against this short-sighted and ultimately counter-productive support of the most vicious dictator in Egypt’s modern history is an indictment of western democracy itself.

S.C.– Where is the Egyptian economy headed ? On one hand, the regime advocates a neoliberal orientation. On the other, the army’s stranglehold on the national economy appears ever stronger. Isn’t this contradictory ?

R. S.—Yes, it is contradictory and results in an economy much like that of Putin’s Russia. It has two “winners”—military and security officers and others linked administratively to the deep state; and oligarchs who command sectors of the economy in alliance with the former. Virtually all other economic actors are “losers.” And as the question suggests, this bifurcation is intensifying as the military’s direct and indirect control of the economy and its sweetheart arrangements with its preferred oligarchs grow ever tighter. There is zero chance of any fundamental reform of this deep state dominated economy so long as Sisi and the military remain in power. The advocacy of a liberal economy in which the regime engages is intended entirely for western audiences and has no relevance to the actual organization and management of the economy.

S.C.– Isn’t the fact that the Egyptian army is increasingly taking control of the country’s economy dangerous for the army itself ? At a conference in Florence (Italy) in January 2025, you spoke of its slow evolution into a conglomerate of “militias”. What were you referring to ?

R. S.—Beginning under Sadat and then intensifying under Mubarak and much more so again under Sisi, the military has shifted its focus from war fighting to profit making. As a consequence its military capacities have stagnated despite being one of the South’s largest spenders on arms procurement and having the largest army in Africa and one of the world’s largest. It devotes inadequate resources to training, repair and maintenance, logistics, force integration, and the ”soft tissue” of military organization and management. The plethora of equipment it has acquired from numerous different suppliers would task even far more sophisticated militaries to integrate into their order of battle. Egypt has not and cannot do that, so the effectiveness of its air force, its armored units, and even its basic infantry has not grown in tandem with its expenditures and acquisitions. The officer corps is concerned with making money, not preparing to make war.

MILITIAS TO CONSOLIDATE POWER

As for militarization, the reference is to the Sons of Sinai organization led by Ibrahim al-Organi and created originally by the military to serve as auxiliary units in the counterterrorism campaign in North Sinai. Sisi then orchestrated the broadening of its roles, both geographically to “mainland” Egypt and functionally, into the economic and political systems. For example he allowed it to become the “middleman” between the Ministry of Interior and Hamas in issuing visas to Gazans for payments typically exceeding $5,000.

Sisi also fostered in late 2024, early 2025 the emergence of a new political party, the National Front, in which al-Organi was initially given the leadership role, to which there were objections apparently from the military which has seemingly begun to perceive him as a threat to their interests. He was temporarily removed, then reinstated but in a somewhat ambiguous role. Speculation by informed sources suggests that Sisi wants al-Organi and his militia and political party to serve both as repressive arms of the presidency and as counterbalances to the military. Never before in Egypt’s modern history has a militia of this nature been allowed to exist by the state. That one has now been created suggests the decay of the nation state more generally.

S.C.– Is Egypt’s official support for the Sudanese army in its almost two-year-old war in Sudan weighing on its economy ?

R. S.— It is a burden but also a benefit for the economy. Directly Egypt has facilitated gold smuggling from northern and western Sudan, from which profits are made by Egyptians involved in that smuggling, probably key of which are the military and security services. Indirectly the presence of Sudanese refugees in Egypt is a source of governmental income in the form of financial assistance provided by donors ranging from the IMF, to the EU, to the US and to many European countries. Those refugees are treated increasingly harshly by the regime and by much of the Egyptian population. On balance it is probably the case that the Sudanese civil war has been profitable for Egypt.

DEPENDENCE ON ISRAEL

S.C.– How does the Egyptian army manage its close relations with Israel (notably over security in Sinai), while preserving its proud mission as guarantor of Egyptian independence? After what happened in Gaza, aren’t there risks for her ?

R. S.—The military and security services of the two countries collaborate closely as evidenced by their ability to manage a host of security crises, whether killings of personnel on either side, violations of treaty provisions, or broader tensions resulting from Israel’s war on Gaza. One reason why this relationship has withstood these strains is that the Israeli military played a key role in suppressing the Sinai insurgency that broke out in the wake of the 2011 uprising. Another and more important one is that Israeli influence in Washington is key to Egypt retaining its favorable position there, despite the recent conviction of Senator Menendez for accepting bribes from Sisi’s closest advisor to facilitate delivery of foreign assistance³.

But collaboration with Israel and its coercive arms is unpopular in Egypt, so Sisi essentially hides it, as he does all “bad news,” whether of a security, political, or economic nature. Since all independent sources of public information have been closed down in the country, Egyptians have no real way of finding out how dependent their country, its military, and its president have become on Israel. Its dependence on the Emirates and Saudi Arabia is more publicly known but not as risky for Sisi because of course they are Arab states. But even regarding that dependence there is considerable public pushback, suggesting just how politically inflammatory information about Israeli-Egyptian security relations could become.