Last Updated: Thursday, 28 August 2014, 08:54 GMT

Egypt: Economy to take a hit from Libya turmoil

Publisher Integrated Regional Information Networks (IRIN)
Publication Date 24 February 2011
Cite as Integrated Regional Information Networks (IRIN), Egypt: Economy to take a hit from Libya turmoil, 24 February 2011, available at: http://www.refworld.org/docid/4d679ea414.html [accessed 28 August 2014]
DisclaimerThis is not a UNHCR publication. UNHCR is not responsible for, nor does it necessarily endorse, its content. Any views expressed are solely those of the author or publisher and do not necessarily reflect those of UNHCR, the United Nations or its Member States.

SALLOUM, 24 February 2011 (IRIN) - The return home of thousands of Egyptian workers from Libya following mass protests against the Gaddafi regime, will mean the loss of millions of dollars in remittances and possible unemployment for the returnees, a leading economist warns.

"Losing these remittances will of course make the situation worse here," Rashad Abdu, a professor at the University of Cairo, said. "Libya is an important and close destination for hundreds of thousands of Egyptian workers who could not find jobs in their country."

About 1.5 million Egyptians work and live in Libya, and send an estimated 1.5 billion Egyptian pounds (US$254 million) in remittances back home every year, according to the Egyptian labour ministry. Many sought work in Libya because the local economy could not absorb them.

"The sorry thing is that it will take most of these people a long time to find jobs in their home country," said Saleh Naser, chairman of the Labour Section at the independent Egyptian Chamber of Commerce. The chamber is composed of company owners and businessmen who try to coordinate the government and the business community.

"The only way out now is for the government to try to open new markets in the Gulf for these people," he said. According to the Chamber of Commerce, an estimated 10 percent of Egypt's 26 million working population are unemployed.

Egyptians working abroad remit about US$12 billion annually to their country. The state-run National Planning Institute, however, expects a decrease during the third quarter of the current financial year because of political turbulence in the Middle East.

Protests against the Hosni Mubarak regime in Egypt forced the Central Bank to shut banks for more than three weeks; they only resumed normal operations on 20 February.

"Egypt has a budget deficit and a government debt load that are teetering on the edge of sustainability," says think-tank Stratfor and the fall-off in remittances will only make matters worse.

Some of those who have returned are the family's sole breadwinner. According to 59-year-old Youssef Fawzi, his son Marwan, used to work in Libya, and the household would now struggle without that financial support.

60,000 overland returnees

At least 60,000 Egyptian returnees had passed through Salloum on the Egyptian side of the border by 24 February, according to officials, and more were following. Carrying bags, blankets and other personal effects, those crossing said they had left behind money and belongings.

When IRIN visited, hundreds of relatives stood waiting to see whether their sons and daughters were among the returnees, who had arrived in all kinds of vehicles after lengthy overland journeys.

"My son called me yesterday and said he was on the way to Salloum," said 59-year-old Youssef Fawzi. "I came here in the early hours of the morning, but so far he has not come."

One returnee, 27-year-old Tamir Mahmud, said work at a construction site in the Libyan city of al-Buraygah was interrupted by heavy gun-fire on the streets, prompting him to leave.

Another, Hossam Rushdy, said some of his friends failed to get to Salloum because they did not have ID cards. "Others were shot dead," he added.

The Egyptian authorities are keeping the land port, the only one with Libya, open all day, and have sent buses to Libya to help some of the returnees get back. They have also erected first aid tents for sick or injured returnees.

Locals in Salloum and the neighbouring Egyptian coastal governorate of Marsa Matrouh have loaded several trucks with medicines, food and blankets, and plan to send them into Libya. The locals appealed to Egyptians to donate blood amid fears of an intensifying humanitarian crisis in their western neighbour.

IOM

According to the International Organization for Migration (IOM), a team from its office in Egypt, the UN Refugee Agency and the UN Office for the Coordination of Humanitarian Affairs were due to begin an assessment of the situation in Salloum on 26 February.

"Of the tens of thousands of sub-Saharan Africans and South Asians working in Libya, only a handful have managed to reach the border so far. This is probably because they do not have the resources to pay for transport," said Laurence Hart, IOM's chief of mission in Libya.

Some 850 Egyptians, IOM said, were travelling to Djerba airport accompanied by IOM staff and Red Crescent volunteers, where two planes sent by the Egyptian government would transport them home.

"We are very concerned for all those migrants who may wish to leave, but cannot. Many countries without the adequate resources to evacuate their nationals are now asking IOM for help. We are therefore urgently appealing to donors for funding to allow us to intervene."


Theme (s): Economy, Governance, Migration,

[This report does not necessarily reflect the views of the United Nations]

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