Egypt seeks help after peaceful revolt

Egypt is billing itself as the land of peaceful revolution, but can such a marketing campaign entice back vital tourists to bolster the economy?

Egypt's tourism industry - one of the largest employers - is among the worst affected by the uprising. Amr Nabil / AP Photo

CAIRO // "Welcome to the land of peaceful revolution," declares the new tourism slogan.

In the context of a worsening economy, it can almost be read as an imperative to the world: help to save our country from ruin.

With unemployment inching upwards and the deficit widening, Egypt has become a regional case study of the economic challenges facing a country in the aftermath of a popular revolution.

GDP fell 4 per cent in the first quarter of the year from a year earlier, with the tourism industry - one of the largest employers - among the worst affected. The number of visitors was down more than 35 per cent in April compared with the same month last year.

"The situation is very difficult," says Dr Zahi Hawass, the minister of state for antiquities, at his Cairo office on the leafy island of Zamalek in the middle of the Nile. "I went to California [in June]. Soon I am going to Australia. We want to tell people that it's safe to come back. They don't need to worry about protests. These happen in every country."

He speaks of protesters locking arms to form a human chain around Cairo's Egyptian Museum to protect it from looters during the revolution. "Our antiquities are still here," Dr Hawass says.

Not all protests in recent months have been non-violent. Dr Hawass was speaking just days before clashes erupted on the streets near Tahrir Square, which is the centre of the revolution and a major tourist draw. The Egyptian Museum and major hotels look on to the expansive square.

During protests last Tuesday night and throughout Wednesday, demonstrators threw rock and started fires, and tear-gas canisters arced across the sky. More than 1,000 people were injured, according to the government. The streets were littered with broken glass and pieces of smashed pavement that were used as missiles.

Add these recent events to growing concerns over what some analysts say is an inconsistent approach to getting the country on the right track, and Egypt looks to be in more perilous shape than it wants to convey.

Tourists may begin to return gradually, but the policy deficiencies are of far greater concern for the economy, analysts say.

There have already been two dramatic changes that hit investor confidence and caused stock markets to fall. A planned 10 per cent tax on stock transactions was unveiled last month but was scrapped just a week later after the idea ran into opposition from leading businessmen, including the country's richest man, Naguib Sawiris, the chief executive of Orascom Telecom.

Then a full budget was announced with presentations and slideshows, only for the finance ministry to replace it with a dramatically changed plan soon after. Furthermore, the government announced it had refused a US$3 billion (Dh11bn) loan from the IMF because it was seeking funds elsewhere.

"People don't know what to make of these decision-making processes," said Magda Kandil, the executive director of the Egyptian Center for Economic Studies.

"Under the old regime, there was no consensus building, but we expect