New challenges ahead for Sisi in 2nd term

CAIRO – 2 June 2018: The winner of Egypt’s 2018 presidential election, Abdel Fatah al-Sisi, was officially sworn in on Saturday morning as the head of state for a second term until 2022.

In a large ceremony held in the Parliament, Sisi took the oath as president with the words: "I swear by God to protect the republican system, to respect the constitution and the law, to safeguard the people's interests, and to preserve the independence of the nation and the unity of its lands."

Sisi has swept a landslide victory with 97.08 percent of valid votes in the March election in which his only challenger, Moussa Moustafa Moussa, claimed about 3 percent of valid votes.

As part of Egypt Today’s coverage of the inauguration of the Egyptian president, we present a profile on Sisi and the main challenges he will face in his second presidential term.

Who is Abdel Fatah al-Sisi?

Sisi used to be Egypt’s minister of defense and commander of the Egyptian armed forces, under former president Mohamed Morsi who was toppled in July 2013 following mass public protests.

Born on November 19, 1954, Sisi grew up in Gamaleya neighborhood, near the Al-Azhar Mosque, in a quarter where Muslims, Jews and Christians resided peacefully.

Sisi graduated from the Egyptian Military Academy in 1977, and then received his commission as a military officer serving in the mechanized infantry, specializing in anti-tank warfare and mortar warfare. He became Commander of the Northern Military Region-Alexandria in 2008 and then Director of Military Intelligence and Reconnaissance. Sisi was the youngest member of the Supreme Council of the Armed Forces of Egypt.

He was also trained at the Joint Services Command and Staff College at Watchfield, Oxfordshire, in the United Kingdom, and the United States Army War College in Carlisle, Pennsylvania. Sisi was appointed minister of defense in August 2012.

Sisi is married to first lady Entissar Amer and has four children; three sons and a daughter.

First presidential term

In his first term in office, Sisi has inherited a nation embattled by years of turmoil and instability. An ambitious economic reform and continued crackdown on terrorism are likely to define his first four years in office.

Following the 2011 revolution that overthrew longtime ruler Hosni Mubarak and the June 30 protests that toppled Muslim Brotherhood-affiliated former President Mohamed Morsi, Egypt’s political landscape restored stability with the election of Sisi as President. Sisi was the third leader of the embattled nation in just three years. Sisi’s popularity emerged when millions answered his call to go to the streets and grant him a “mandate to fight terrorism” in July 2013.

The challenges that faced Sisi in his first term stretched far beyond political division to an economy that has suffered from years of turmoil and bloodshed. Sisi was keen during his first term in office to rebuild the country’s state institutions and regain international confidence in Egyptian economy after it suffered severe deterioration due to terrorism and political unrest. Since 2014, Sisi has waged fierce war against terrorism in parallel with ambitious infrastructure projects like the new Suez Canal and the new Administrative Capital and a wide economic development strategy which was launched in 2016.

The lack of foreign direct investment in Egyptian businesses, infrastructure, and energy was a massive challenge in Egypt after the 2011 revolution, draining the state of foreign currency and reserves.

The year 2016 was a milestone in Sisi’s first presidential term in which he outlined Egypt’s progressive sustainable development strategy, “Egypt’s Vision 2030,” which aims to place Egypt among the world’s top 30 countries in economic and social development. In the same year, Egypt received a $12 billion loan with the International Monetary Fund (IMF) in a bid to restore confidence in its economy and tackle severe foreign exchange shortages. The World Bank also provided Egypt with the first $1 billion tranche of a $3 billion loan, as part of its support for the government's economic program.

Under Sisi, Egypt’s cash reserves increased to $37 billion up from $16 billion in 2014. The unemployment decreased from 13.4 percent to 11.9 percent because numerous job opportunities became available due to the number of national projects being established. The country also witnessed a hike in the foreign investments flow by 14 percent in the fiscal year (FY) 2016/2017.

Sisi’s administration faced one of the most catastrophic flight accidents in the world, when the Airbus A321, operated by Metrojet, crashed over the Sinai Peninsula in October 2015, killing all 224 on board. The flight was carrying Russian tourists returning from the Red Sea resort of Sharm El-Sheikh to St. Petersburg. As a result, Moscow suspended its direct flights with Cairo. After more than 27 months of direct flights suspension, during which the Egyptian government spared no effort to find a solution to the issue, Russian Transport Minister Maxim Sokolov announced the resumption of commercial passenger flights between the two countries in February.

Before Sisi, Egypt had experienced a serious energy crisis as large parts of the country used to face around six power cuts a day for up to two hours at a time. The blackouts have created widespread frustration, with businesses reporting a downturn in production and citizens complaining about the disruption to everyday life.

Ending the power crisis was as one of the main priorities of Sisi’s agenda. The government worked to increase power stations in Egypt, to provide an estimated 25,000 MW, annually. Egypt signed a number of agreements with major international companies, mainly Siemens AG, to build gas, wind and solar power plants valued at billions of dollars, which are estimated to boost Egypt’s power production. Moreover, Sisi and his Russian counterpart signed an agreement to build a nuclear power plant in Egypt (Dabaa), with Moscow extending a loan to Cairo to cover the cost of construction.

Egypt has one of the Middle East’s largest natural gas reserves, yet has been unable to meet its monthly export commitments, as Egypt used to tap most of its gas for domestic use. Domestic energy demand has surged due to heavy subsidies on petroleum products, allowing residential and industrial consumers to purchase gas and power facilities far below market cost. As a result, the Egyptian government started to gradually lift the subsidies on fuel, diesel and natural gas, increasing their prices twice in November 2016 and June 2017.

These moves encouraged foreign companies to invest heavily in gasfields and production plants in Egypt. As a result, Italy’s Eni announced in 2015 the discovery of its Zohr gas field, located about 120 miles off the coast of Egypt, with reserves of as much as 30 trillion cubic feet of lean gas, marking the largest discovery in the history of both Egypt and the Mediterranean Sea. In the same year, BP announced discovery of the “Atoll-1” deepwater exploration well – Egypt’s deepest gas well – in the North Damietta Offshore Concession in the East Nile Delta. The estimated potential of the concession exceeds 5 trillion cubic feet. Egypt is currently highly import-reliant on gas: being the world’s 8th biggest importer of natural gas worldwide. However, the new gas discoveries are expected to reverse Egypt’s position and make it an exporter of natural gas, rather than an importer.

Since the very beginning of his rule, Sisi was aware of the housing crisis in Egypt. He was always keen to establish new cities and launch massive housing projects to provide suitable accommodation to citizens. Under Sisi, the state established 245,000 residential units for middle-class people at the cost of LE 32 billion with more 355,000 units are now being established at the cost of LE 71 billion. In 2017, Sisi launched a huge project to build a New Administrative Capital on the outskirts of Cairo at the cost of $45 billion. The first phase of the capital is expected to be completed by the end of 2018. The new capital will be divided into 20 districts that could house up to six million people. It is also planned to include educational institutions, hospitals, 40,000 hotel rooms, a theme park, solar plants and a new international airport.

During his fourth year in office, President Abdel Fatah al-Sisi continued his focus on boosting the country’s foreign policy by forming political and economic partnerships with major regional and world powers. Sisi flew to more than 20 countries where he held high-level meetings with political leaders and participated in international forums with the aim to deliver the new image of Egypt to the world. The president’s tours basically sought to attract foreign investment to the country, which is currently undergoing intensive economic reform measures with the aim to adjust the business climate for local and foreign companies.

Challenges in second presidential term

• Terrorism

Although the Egyptian security and armed forces have showed a lot of strength and efficiency in the fight against ongoing terrorism that plagued the country in the last few years, terror groups such as Ajnad Misr (Soldiers of Egypt) and Ansar Bayt al-Maqdis (Supporters of Jerusalem) in the North Sinai are still a consistent threat to the nation’s security.

Egypt launched several military operations, including Operation Eagle in mid-2011, Operation Sinai in mid-2012, Operation Martyr's Right in 2015, and Comprehensive Operation Sinai in 2018. The ongoing operation was considered to be the largest military action in the country in years. The operation targets sites in all towns in the North Sinai, Central Sinai, Nile Delta and the Western Desert. The Global Terrorism Index (GTI) 2017, issued in late November, has excluded Egypt from its list of the ten countries most affected by terrorism. However, there is still an unanswered question in Egypt: when will the ongoing terror attacks, particularly in the Sinai Peninsula, end?

• The Grand Ethiopian Renaissance Dam (GERD)

The Ethiopian Renaissance Dam issue is still on the top of the Egyptian government’s priorities in 2018. Construction of the $5 billion worth dam has begun more than six years ago on the Blue Nile River and is now close to completion. The dam raised plenty of concerns in both downstream countries, Egypt and Sudan, that the flow of the Blue Nile will be curtailed, particularly during the filling of the dam’s reservoir. The Blue Nile is the main tributary of the Nile River, and both Egypt and Sudan rely on the river for irrigation and electricity.

Since 2011, Cairo has undertaken all required measures to avoid the negative impact the Ethiopian dam will have on its historic Nile water share, amounting to 55.5 billion cubic meters, in accordance with the historic 1959 agreement with Sudan. The real average consumption of water in Egypt is 105 billion cubic meters, of which 80 billion cubic meters are covered by the reuse of wastewater.

• Corruption

Bribery and corruption have been rife in Egypt for long decades and was one of the main causes of the 2011 revolution that toppled longtime president Mubarak.

President Sisi always asserted on applying strict measures within the government institutions to crack down any violation. He frequently hailed the role played by the Administrative Control Authority (ACA) in different occasions. The ACA’s efforts were very fruitful in the last years and prosecuted several high-profile cases which led to a noticeable decline in corruption incidents.

• Reforming religious discourse

Since 2014, Egypt's Sisi frequently reiterated that reforming religious discourse is a key element in defeating terrorism. He said during an Al-Azhar ceremony in 2017 that renewing religious discourse, dealing with all terrorist groups equally, rebuilding regional state apparatuses, and cutting off funding to terrorist groups are key factors to the elimination of terrorism and extremist ideologies.

• Health insurance

In December 2017, the Parliament approved the Comprehensive Health Insurance Law, drafted by the government in October, with an unprecedented parliamentary majority.

The law provides free health care for citizens who cannot afford to pay for medical services. These account for 30-40 percent of the population. Subscription would be obligatory for those who cannot afford covering treatment costs for all diseases. The sources of funding would include fees paid by citizens, donations, tax on cigarettes, and others increasing from three to six sources.

The new health insurance system will be first applied in five governorates, including Port Said, Suez, Ismailia, North Sinai and South Sinai and it will be generalized across the country gradually until 2032. It targets around 42 million citizens who do not benefit from any health insurance services in Egypt.

• Education

Sisi always gave directives to officials to continue efforts of developing basic and higher education in a bid to link education with labor market needs.

In January, Sisi announced that the development of education in Egypt requires LE 220 billion, stressing that young people are the backbone of the country. The ministry of education launched a new system set to begin in September and it will be compulsory in KG1, KG2 and first grade classes in all private and public schools. The new system will cancel the Primary Education Certificate and the traditional Thanaweya Amma (high school) system and will be replaced with a new secondary education system based upon the Grade Point Average (GPA), starting from the school year 2018-2019.