June 4, 2024 | Flash Brief

Egypt’s Sisi Orders Cabinet Reshuffle Amid Spiraling Economic Crisis

June 4, 2024 | Flash Brief

Egypt’s Sisi Orders Cabinet Reshuffle Amid Spiraling Economic Crisis

Latest Developments

Egyptian President Abdel Fatah al-Sisi reappointed Prime Minister Mostafa Madbouly on June 3 and ordered him to form a new government. Sisi’s announcement came shortly after Madbouly submitted his entire cabinet’s resignation. Cairo offered no official explanation for the mass resignation; however, the cabinet reshuffle was not unexpected given Egypt’s economic woes, which have worsened since the start of Sisi’s third and final term in April 2024.

In the interim period, inflation rates in Egypt have soared as high as 40 percent, while the price of bread, a staple food subsidized by the government, has quadrupled. In a post on X, Sisi requested that the new government focus on “confronting the challenges facing the state.” The official statement from his office specified that “Sisi directed that the new government should continue the economic reform file, focusing on attracting internal and external investments, encouraging private sector growth, and making efforts to reduce price increases and inflation and control markets.”

Expert analysis

“This reshuffle is largely cosmetic — but notable — as it comes just days after the government raised the price of subsidized bread by 400 percent. As Sisi juggles the disastrous economy and the Hamas-Israel war, he is presenting the previous government as a scapegoat for these ills. The reshuffle is simply a way to pacify a very frustrated Arab street. The question is: how long will this last?” — Mariam Wahba, FDD Associate Director of Communications

“Egypt has obtained financial commitments of more than $50 billion from a combination of the IMF, World Bank, European Union, and the United Arab Emirates. Sisi wants to send a message of hope to domestic constituents, as well as to boost confidence among outside lenders that his regime is serious about tackling dire socioeconomic challenges. The new government will likely include new faces, but there is some confusion among observers as to why the same prime minister will continue.” — Haisam Hassanein, FDD Adjunct Fellow

Sisi Secures Third Presidential Term

Sisi secured a third term as Egypt’s president on December 18, winning a landslide victory with nearly 90 percent of the vote. In his victory speech, Sisi said that “Egyptians lined up to vote not just to choose their president for the next term, but to express their rejection of this inhumane war [in Gaza] to the entire world.”

Sisi then spoke with Palestinian Authority President Mahmoud Abbas and “reiterated Egypt’s commitment to making all possible effort to protect the Palestinian people,” according to a readout from Cairo. However, under Sisi’s leadership, Egypt has refused to accept Palestinians seeking to evacuate Gaza and closed the single crossing between Gaza and Egypt in Rafah. Cairo has also failed to stop Hamas from using tunnels under the Egypt-Gaza border to smuggle weapons and ammunition.

Egypt Turns Blind Eye to Hamas

Israeli troops continue to discover more evidence of Hamas’s entrenchment along the Egyptian border as they operate in the southern Gaza city of Rafah. On May 17, Israel went public with the discovery of 50 smuggling tunnels snaking beneath Gaza into the Egyptian Sinai. Israeli Attorney General Gilad Noam explained that the “tunnels are used by Hamas to supply itself with weapons and ammunition, and could potentially be used to smuggle out of Gaza hostages or Hamas senior operatives.” On May 22, Israeli forces operating in Rafah discovered a cache of Palestinian rockets primed for launch next to the Egyptian border.  

“Egyptian Blockade of Aid to Gaza Earns Rebuke from U.S.,” FDD Flash Brief

Israel: 50 Rafah Tunnels to Egypt Unearthed,” FDD Flash Brief

Egypt’s Sisi Wins on Anti-Palestinian Ticket,” FDD Flash Brief

Hamas Tunnels to Egypt Played Key Role in Arming Hamas,” FDD Flash Brief

Issues:

Arab Politics Egypt Israel Israel at War