Cairo (AFP)

After easing its measures against the new coronavirus, Egypt hopes for a rapid return to normalcy to offset the consequences of the pandemic on its economy, barely recovering from the years of political instability.

Faced with the global health crisis, Cairo has chosen to maintain activity in several areas in order to preserve the growth of its gross domestic product (GDP), which reached 5.6% at the end of 2019 according to the International Monetary Fund (IMF).

While construction, agriculture and the informal economy continue to operate without too many obstacles, most of industry, tourism and civil aviation have stalled.

Mahmoud al-Dabaa, a tour operator from the seaside resort of Sharm el-Sheikh, by the Red Sea, imagined that this season would be the best since 2010 ... but that was without counting on the virus.

"I can't believe that tourists have been told to go home (...) because of the coronavirus," Dabaa told AFP.

"It is the first time that I see Sharm el-Sheikh completely empty," he added, saying he was "shocked" by the deserted beaches.

Heavyweight of the Egyptian economy, the tourism sector has already suffered from political and security instability after the popular revolt of 2011.

In 2019, this key sector had generated 11.6 billion euros in revenue, the highest gains of the decade, according to official figures.

- Growth at half mast -

The Egyptian economy has become more attractive after the reforms imposed in 2016 as part of an IMF support plan of 12 billion dollars (10.7 billion euros).

In January, it was among the top ten emerging economies in the world, according to a study by the Standard Chartered Bank in London.

But after the virus appeared, Cairo declared a curfew, closed its airports, cafes, schools and universities, laid off millions of civil servants and partially closed its businesses, slowing down activity.

Egypt, populated by 100 million inhabitants, officially registered 7,201 contaminations including 452 deaths linked to the Covid-19 disease.

Civil aviation lost more than two billion euros in March and foreign exchange reserves fell from 41.7 billion euros in February to 36.8 billion euros, according to the government.

As for growth, Planning Minister Hala al-Said estimates that it will not exceed 4.2% at the end of the 2019-2020 fiscal year, against a forecast of 5.8% before the pandemic.

For its part, the IMF, which the Egyptian government has asked for a new loan and technical assistance to cope with the recession caused by the virus, estimates that it will cap at 2%.

- Next resumption -

But for Angus Blair, professor of economics at the American University in Cairo, "25% of the workforce resides in agriculture which is not affected, many businesses are open (...) and work continues. "

Little affected also by the measures, the building sector, in particular, accounts for 8.8% of GDP. It is based on the new city projects launched by President Abdel Fattah al-Sissi since he came to power in 2014, like the new administrative capital, east of Cairo.

In addition, the informal economy, "although it has slowed down", is also helping to maintain activity, comments Mr. Blair.

Representing almost half of the private sector, it represents four million workers, according to the national statistics agency (CAPMAS).

In late April, after easing the curfew for the fasting month, Prime Minister Mostafa Madbouly said he hoped for a "gradual return to normal" from the Eid holiday, at the end of Ramadan, in late May. .

And to encourage a recovery in domestic tourism, the authorities announced Sunday the reopening of a quarter of the country's hotels in mid-May, a percentage that will increase to 50% on June 1.

"If the constraints are eased in June for example, economic activity in other sectors could lead growth until the 3rd and 4th quarter," said Blair.

- Impact on the poor -

Engineer in the automotive industry, where activity has contracted relatively little, Mohamed Chadid, 32, has not stopped working since the emergence of the virus, despite the risk of contamination.

"Production has dropped because we are no longer receiving raw materials," he said.

Thinking of the most vulnerable, Mr. Chadid believes that "we must not stop completely (the economy) so that those who are still working can provide for their families."

Aliaa al-Mehdi, former dean of the Faculty of Political Science at the University of Cairo, believes that the slowdown in activity may have "a temporary impact on the poverty rate" in Egypt, where nearly a third residents already live on less than 1.3 euros per day, according to official figures.

"The state has to provide extensive support to the private sector to overcome the crisis," she said.

© 2020 AFP