Egypt has recently clinched a substantial financial lifeline, securing a deal with the International Monetary Fund (IMF) to bolster its economic resilience. This agreement, doubling Egypt’s IMF bailout to a significant $8 billion, follows a series of pivotal economic reforms initiated by Cairo.

One of the critical measures taken by Egypt was allowing its currency, the pound, to undergo a substantial devaluation against the US dollar, plummeting to record lows. This decision, aimed at fostering a more flexible exchange rate regime, was pivotal in unlocking much-needed support from the IMF to stave off what could have been Egypt’s most severe economic crisis in decades.

The devaluation of the pound, by a staggering 40 per cent, coupled with significant hikes in interest rates, was undertaken to alleviate the strain caused by a shortage of foreign currency. It’s worth noting that permitting market forces to dictate the value of the pound was a precondition for Egypt to access additional IMF funds, following a previous $3 billion bailout secured in 2022.

The impact of these economic manoeuvres was palpable as the pound plummeted beyond 50 against the dollar, a stark contrast to its artificial stability around 31 to the dollar for nearly a year. This sharp decline in the official exchange rate brought it more in line with the prevailing black market rates, which had soared to more than twice the official rate.

Despite the inevitable challenges posed by such drastic measures, with an inflation rate hovering around 30 per cent as of January, Egyptian authorities were cognizant of the potential hardships facing their populace. However, the injection of $35 billion into Egypt by ADQ, a prominent Abu Dhabi-based investment vehicle, provided a much-needed cushion for the central bank to navigate the aftermath of currency controls being lifted.

The significance of ADQ’s investment cannot be overstated, as it played a pivotal role in facilitating the IMF deal. With the influx of funds, the currency found a more stable footing, and Egypt’s foreign reserves experienced a notable boost. This, in turn, significantly mitigated the risk of a currency freefall, providing much-needed reassurance to investors and stakeholders alike.

Egypt’s economic woes were further compounded by external factors, including the recent conflict between Israel and Hamas in Gaza. Given Egypt’s strategic proximity to the besieged strip, it plays a crucial role in facilitating aid delivery and negotiation efforts with Hamas. Moreover, disruptions to foreign currency revenue, stemming from attacks on vessels in the Red Sea by Houthi rebels in Yemen, added to Egypt’s economic challenges.

The magnitude of ADQ’s investment, earmarked for the development of vast coastal expanses along Egypt’s Mediterranean coast, effectively served as a bailout from the Gulf state. This infusion of fresh capital, coupled with a rapid disbursement schedule, provided much-needed relief to Egypt’s foreign currency crisis and helped cement the IMF deal.

In concrete terms, the agreement entailed a staggering $24 billion in fresh investments, complemented by the conversion of $11 billion of UAE deposits into local currency for use in various projects across Egypt. Notably, the initial tranche of $10 billion had already been disbursed, with the remaining funds scheduled to arrive within six weeks, as per Egypt’s announcement.

Egypt’s reliance on IMF support dates back to 2016, making it the fund’s second-largest debtor after Argentina. Previous agreements, such as the $3 billion support package in October 2022, mandated pivotal reforms, including a shift towards a more flexible exchange rate and the privatization of state-owned assets, including those under military ownership.

The Central Bank of Egypt has underscored its commitment to maintaining stability amidst these economic upheavals. In addition to floating the currency, the central bank implemented a significant hike in interest rates, increasing the overnight lending rate to 28.25 per cent and the overnight deposit rate to 27.25 per cent. These measures are aimed at bridging the gap between official and black market exchange rates, while also addressing inflationary pressures.

In conclusion, Egypt’s recent economic reforms, including the devaluation of its currency and securing substantial investments from abroad, have positioned the country on a more stable economic trajectory. While challenges persist, particularly in the face of external geopolitical tensions, the increased IMF support and strategic investments offer a glimmer of hope for Egypt’s economic recovery and resilience.

In a tragic onset on Thursday, the Philippine government confirmed that three of its citizens were amongst the casualties of a Houthi attack that targeted an American ship stationed in the Gulf of Aden. Termed as an act of Houthi aggression, the insurgent forces carried out an attack on Wednesday, resulting in the loss of several lives. The American vessel, christened True Confidence, was flying the Barbados flag at the time of the attack.

The Department of Migrant Workers, in a state of profound grief, confirmed the death of “three Filipino seafarers in the most recent attack by Houthi rebels on ships navigating the Red Sea and the Gulf of Aden.” A further development confirmed that two additional Filipino crew members had suffered severe injuries during the assault on their ship.

The armed Houthi attack was carried out around 11:30 a.m. on the 6th of March, with an anti-ship ballistic missile (ASBM) launched from Houthi-controlled regions of Yemen. This Iranian-backed Houthi terrorist action was aimed at M/V True Confidence, a Liberian-owned vessel flying the Barbados flag.

In response to the unfortunate incident, the U.S. Central Command (CENTCOM) acknowledged the occurrence of “three fatalities, at least four injuries—three of them being severe—and extensive damage to the ship.” Despite the attack, the CENTCOM announced later that it had conducted strikes on targets within Yemen as a self-defence measure. According to CENTCOM, this was done to “protect freedom of navigation and make international waters safer and more secure for U.S. Navy and merchant vessels.”

Specifically, CENTCOM stated, “At approximately 7:14 p.m. (Sanaa Time), United States Central Command conducted self-defence strikes against two unmanned aerial vehicles in a Houthi controlled area of Yemen that presented an imminent threat to merchant vessels and U.S. Navy ships in the region.”

Meanwhile, Houthi Military Spokesperson, Yahya Saree, confirmed in a press statement that the Yemeni Armed Forces launched the attack on the American ship True Confidence in the Gulf of Aden. Saree notified that the attack utilised naval missiles and led to significant casualties. He defended the brutal act by clarifying that it was executed in response to the ship’s crew disregarding warning messages issued by the Yemeni naval forces.

This incident questions the relative safety of the gulf region, hinting at the volatility of Middle-Eastern geopolitics. It further underlines the persistent dilemma of those risking their lives for economic prosperity, especially visible through the loss of Filipino lives. As the international sphere comes to terms with the profound loss and speculates the escalation of violence, the ripple effects of the attack will continue to be felt across the regions and stakeholders involved. Fear lingers amongst sailors and naval forces about the growing risks pervading the Red Sea and the Gulf of Aden.

In escalating developments, Yemen has vowed to expand its military operations, using naval missiles and drone technology, against aggressors until violence ceases and the encirclement of Gaza Strip is lifted, according to Yemen’s Houthi forces. This move aligns with global calls to support Palestinians enduring aggression and impoverishment, and comes in the wake of a series of US-British strikes on Hodeidah.

Houthis’ Al Masirah TV detailed the sixth raid in a matter of hours, propelled by US-British forces on the Yemeni port city of Hodeidah. Consistent air strikes, reportedly targeting the Al-Jabbana and Ras Issa areas, have provoked staunch resistance from Houthi-controlled territories.

In retaliation, the Yemeni armed forces have turned the tables by aiming naval-based missile technology and drones at two American warship destroyers stationed in the Red Sea. This aggressive stance is part and parcel of Yemen’s broader commitment to continue operations until external tensions ease and the stringent Gaza Strip siege concludes.

The deeply ingrained conflict in Yemen shows no sign of slowing down, with the ongoing raids on Hodeidah serving as a stark reminder of the entrenched tensions between the Houthi forces and their Western-backed opponents. However, the Yemeni forces’ decision to step up operations until an armistice is achieved and the Gaza Strip’s isolation ends adds another layer of complexity to the already fraught scenario.

The pledge by Yemen’s armed forces represents a significant development in the tormented socio-political landscape of the Middle East. A recurring theme throughout the conflict has been the plight of the Palestinian people, and Yemen’s retaliatory actions mirror the international outcry for greater support for Palestinians facing ongoing hardship and deprivation.

While the immediate focus remains the winding down of hostilities and the lifting of the Gaza siege, the wider implications of Yemen’s amplified involvement cannot be overlooked. Prolonged unrest in the region can worsen an already troubling humanitarian crisis, potentially displacing more people and exacerbating privation among those caught in the conflict.

With Yemen poised to enhance their retaliatory operations and the deadly circle of violence showing no immediate signs of letting up, the future remains uncertain for those caught in the crossfire. The international community continues to monitor developments closely, with urgent calls for deescalation and a shift towards diplomacy growing ever louder.

As was reported last month by Al Masirah TV, Yemen’s response comes in the aftermath of repeated US-British raids on Hodeidah. The Western operations further inflame a volatile region already riddled with humanitarian crises and deep-seated socio-political issues. However, as Yemen’s statement suggests, there is also a sense of solidarity with the plight of Palestinians in Gaza, as they endure the dual hardships of aerial bombardment and economic isolation.

In an increasingly interconnected world, the implications of Yemen’s ongoing conflict echo far beyond its borders. It is another sobering reminder of the turmoil in the Middle East, where war and political instability create a humanitarian catastrophe affecting millions of innocent lives. The path toward resolution remains fraught with challenges, and it seems that Yemen is prepared to escalate its operations until broader regional issues, such as those affecting the Gaza Strip, are addressed comprehensively.

In the tumultuous landscape of the Middle East, Syria has long been a battleground for regional and international powers vying for influence and control. While Russia and Iran have historically held significant sway in the region, a new player has emerged onto the scene – China. With its economic prowess and strategic interests, China could potentially reshape the dynamics of power in Syria and the wider Middle East.

Russia and Iran have been pivotal in supporting the Syrian regime of Bashar al-Assad during the brutal civil war that has ravaged the country since 2011. Russia, with its military intervention starting in 2015, provided crucial support to Assad’s forces, helping to turn the tide of the conflict in his favor. Iran, through its support for Hezbollah and various Shiite militias, has also played a key role in bolstering Assad’s regime and countering opposition forces.

However, China’s approach to the Syrian crisis differs significantly from that of Russia and Iran. While Russia and Iran have primarily focused on military intervention and supporting the regime, China has opted for a more nuanced approach, emphasizing economic cooperation and reconstruction efforts.

One of China’s key interests in Syria lies in the establishment of trade routes that connect Iran to the Mediterranean through Syria. These trade routes, often referred to as the “Silk Road,” hold immense economic potential for China, allowing it to access markets in the Middle East, Europe, and beyond. By investing in Syria’s infrastructure and reconstruction projects, China aims to solidify its position as a major player in the global economy while also exerting influence in the region.

The significance of these trade routes cannot be overstated. They not only offer economic opportunities for China but also serve as a means of bypassing traditional maritime routes, reducing dependency on potentially vulnerable sea lanes such as the Strait of Malacca. This strategic diversification of trade routes aligns with China’s broader geopolitical ambitions of securing its energy supplies and asserting its influence on the global stage.

Moreover, China’s involvement in Syria complements its broader foreign policy objectives, particularly its ambitious Belt and Road Initiative (BRI). The BRI, unveiled by President Xi Jinping in 2013, seeks to enhance connectivity and cooperation among countries across Asia, Africa, and Europe through infrastructure development and trade linkages. By investing in Syria’s reconstruction, China not only contributes to the stabilization of the region but also advances its own strategic interests under the guise of promoting economic development and connectivity.

While China’s engagement in Syria may appear primarily economic in nature, it also carries significant geopolitical implications. By establishing closer ties with the Syrian regime, China undermines Western efforts to isolate Assad diplomatically and economically. As Western powers grapple with the complexities of the Syrian conflict, China’s pragmatic approach offers an alternative narrative that prioritizes stability and economic development over regime change and intervention.

Furthermore, China’s growing presence in the Middle East challenges the traditional hegemony of Western powers in the region. As the United States gradually disengages from the Middle East and focuses its attention elsewhere, China senses an opportunity to fill the void and assert its influence. By cultivating strategic partnerships with countries like Syria, China seeks to reshape the geopolitical landscape of the Middle East in its own image.

However, China’s rise as a new player in the Syrian game of influence and control is not without challenges and risks. The complex and volatile nature of the Syrian conflict presents numerous obstacles to China’s ambitions, including security concerns, political instability, and competing interests among regional actors.

Moreover, China’s pragmatic approach to foreign policy may encounter resistance from Western powers, particularly the United States and its allies, who view China’s growing influence with suspicion and apprehension. As China expands its footprint in the Middle East, it must navigate carefully to avoid exacerbating existing tensions and conflicts in the region.

In conclusion, China’s emergence as a new player in the Syrian game of influence and control signifies a paradigm shift in the geopolitics of the Middle East. With its emphasis on economic cooperation and reconstruction, China offers a fresh perspective that challenges traditional power dynamics dominated by Russia and Iran. As China deepens its engagement in Syria and the wider region, the geopolitical landscape is poised for further transformation, with far-reaching implications for global security and stability.

Image Credit: Hosein Charbaghi / Unsplash

The March edition of the US State Department’s magazine delved into the bilateral relations between the US and Morocco in its “Post of the Month” article.

The feature article reflected on the long-established bilateral connections between the two nations, underscoring the US commitment to enhancing cooperation with Morocco across all spheres.

Emphasizing its geopolitical significance, the magazine underscored Morocco’s pivotal role as a gateway to both Africa and Europe.

“Given its proximity to neighbouring Spain, which lies just 8 miles north of Tangier across the Strait of Gibraltar, Morocco is a vital portal between Africa and Europe,” the magazine noted, highlighting the North African nation’s rich cultural diversity and traditions.

The State magazine also cited statements from diplomats, including the current US ambassador to Morocco, Puneet Talwar, who expressed the country’s robust cooperation and partnership with the US.

“Morocco is proud to stand with us… I think it’s critical that we devote time, energy, and attention to our friends and see how we can advance areas of mutual interest, as well as work with them on the challenges we face,” Talwar remarked.

David Fisher, Political Counsellor at the US embassy in Rabat, also weighed in on the bilateral ties between the two countries, noting the political stability prevalent in the North African nation.

“You won’t find any other country in Africa that’s as stable and as reliable an ally as Morocco,” Fisher asserted.

The US is among the nations that acknowledge Morocco’s sovereignty over its southern provinces in Western Sahara.

Former US President Donald Trump signed the proclamation recognising Morocco’s territorial integrity and sovereignty over its southern provinces in December 2020.

“It’s a real pleasure working here knowing that we’re contributing to furthering and continuing to build our alliance with one of America’s oldest friends, partners, and allies that dates back to the founding of our own nation,” Trump expressed.

The magazine article also underscored the significance of cooperation between the two countries in terms of security and counterterrorism.

Describing Morocco as one of the largest non-NATO allies to the US, the magazine highlighted that the North African country plays a “pivotal role in regional security and counterterrorism efforts.”

This is evident in Morocco’s hosting of joint military exercises with American troops annually.

The military collaboration includes the African Lion, the largest military drill that Morocco has hosted for over 18 years.

“There are more than 100 U.S.-Moroccan military engagements over a year. African Lion just gets most of the attention because it’s the largest,” Fisher commented on this matter.

He described Morocco as a “real beacon of stability.”