Trevor Claringbold

The Egyptian people have many reasons to be proud. Theirs is a history as rich as any other, and richer still. From Egypt’s earliest beginnings as a cradle of civilization to the modern day, the nation has flourished because of its people’s mastery of the land. In Ancient times, an empire arose within the Nile River Valley as vast deserts and the sea insulated Pharaoh from his enemies (at least for a while). This rich tradition, however, is in peril. As the nation continues to recover from the Arab Spring and its aftermath, factional forces, political unrest, and fear have crippled Egypt’s once vibrant tourism sector. The economic consequences are profound and widespread, and may only serve to engender a vicious cycle of poverty and instability in the region.

It goes without saying the tourism industry is a vital part of the Egyptian economy. Although this industry has existed in one form or another throughout the last century, its modern iteration is largely the result of the Egyptian government’s centrally planned economy under Nasser’s 1960-65 Five Year Plan. Over the span of six decades, the number of tourists in Egypt grew steadily. At its apex in 2010, Egypt’s tourism sector was estimated to have employed around 12 per cent of the nation’s total workforce, and comprised around 11 per cent of GDP. Since then, the effects of political unrest and terrorist activity have decimated the industry, leading to widespread unemployment in areas home to formerly popular tourist attractions. From 2010 to 2014 alone, the Egyptian government estimated revenue reductions of nearly 40 per cent, from 12.5 billion USD to just 7.5 billion. Continued political instability over the last few years have afforded little room for recovery. Terrorist activity has had an especially malignant effect, with each attack followed by a sharp decrease in the number of visitors to Egypt.

Trevor Claringbold
Image courtesy of Trevor Claringbold, © 2014, some rights reserved.

On 31 October 2015, Russian Metrojet Flight 9268, departing from Sharm el Sheikh – one of Egypt’s most popular tourist destinations – was brought down by a bomb, ending the lives of 224 people. Following the crash, the Islamic State of Iraq and the Levant (ISIL), claimed responsibility for the attack on social media, and posted pictures of the bomb on its online magazine Dabiq. Only a few months later, three foreign tourists were stabbed by ISIL militants at the Red Sea resort Hurghada. On 19 May 2016, EgyptAir flight 804, with 66 souls on board, crashed into the Mediterranean Sea. No survivors were found in the wreckage. Although the cause of the crash is still under investigation, officials have named an onboard fire as the primary cause of the crash, leaving the possibility of a terrorist attack open. In response to these incidents, airlines and governments have suspended flights to many regions of Egypt, and travelers now avoid what were once crowded resort towns.

The economic consequences of terrorist activity in Egypt are explicit. From February 2015-2016, the number of visitor to Egypt dropped from 640,200 to 346,500, a decrease of nearly 46 per cent. In January 2016, hotel occupancy was estimated around 15 per cent, with the sharp decrease in visitors costing the nation’s economy an average of 290 million USD a month. Egypt’s struggling tourism industry is plunging the nation into economic ruin. The country recently accepted a 12 billion USD loan from the International Monetary Fund (IMF), and is on track to devalue its currency for the second time in a year.

The cruel irony inherent to Egypt’s struggling tourism sector is that it is a self-replicating process. Reduced tourism revenue leads to unemployment and poverty, adding gasoline to an already smoldering political landscape. Terrorists target the tourism industry for a variety of reasons, and history shows us it is in their own best interests to do so. By destroying extrinsic sources of economic prosperity – such as the tourism industry – terrorist organizations such as ISIL turn formerly prosperous areas into recruitment grounds, establishing a monopoly on social services and employment through force, and propagating their existence through fear. A remarkably relevant example can be found elsewhere on the African continent, in Kenya. Following successive terrorist attacks by the Islamic militant group al-Shabaab in 2013 and 2014, Kenya’s tourism industry plummeted in the wake of government sponsored travel warnings to the nation. The economic turmoil this crash caused proved a catalyst for terrorist movements in the region. Kenyan youth, now bereft of their former hospitality jobs, soon found themselves targets of radical recruiting. As one American official remarked: ‘The weakening of the coastal economy is aggravating the very problem we were trying to combat.’ Terrorist activity had successfully cultivated fear in foreigners and Kenyans alike, and temporarily achieved its goal of economic destabilisation. Although the overall degree of danger for visitors may have been ambiguous, governments obliged to advise their citizens contributed – knowingly or otherwise – to Kenya’s economic instability, which in turn afforded terrorist organizations more influence in the region. This observation is by no means meant to ascribe blame to any government, rather to highlight the primacy of fear as the most valuable tool of terrorist organizations, whether al-Shabaab in Kenya, or ISIL in Egypt and the Middle East.

To regain its former economic strength, Egypt must save its tourism sector. No government, however powerful, will ever succeed in eliminating fear entirely, but measures can be taken to lessen its chokehold on the Egyptian economy. For its part, Egyptian government officials seem to be going great lengths to stimulate confidence in recovery. In recent months, the Egyptian government has announced plans to dramatically increase its security presence in popular tourist destinations. Following the Hurghada attacks, Egypt’s tourism ministry under Hisham Zaazou announced plans to invest the equivalent of nearly 26 million GBP towards new security measures, such as CCTV cameras and x-ray machines. A UK government taskforce under Sir Gerald Howarth has advocated the resumption of UK flights to Sharm el-Sheikh, citing perceived improvements in airport and resort security. The Conservative MP from Aldershot explained his rationale for the lifting of travel bans, stating: ‘Keeping on those staff is clearly unsustainable in the longer term, and once they are laid off a large cadre of disaffected people and their families could become vulnerable to radicalization.’ It would seem that at highest levels of government, ranking officials are aware of the vicious cycle of tourism poverty and terrorism, and of the need to combat the fear tactics of radical organizations.

As of 31 October 2016, the UK Foreign and Commonwealth Office advises against ‘all but essential travel’ to or from Sharm el-Sheikh. Time will only tell what all this means for Egypt’s tourism industry.

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