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War Has Already Hurt the Economies of Israel’s Nearest Neighbors

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The impact on global growth of the Middle East violence has so far been contained. That’s not the case for Egypt, Lebanon and Jordan, which were already struggling.In the Red Sea, attacks by Iranian-backed Houthi militants on commercial ships continue to disrupt a crucial trade route and raise shipping costs. The threat of escalation there and around flash points in Lebanon, Iraq, Syria, Yemen and now Iran and Pakistan ratchets up every day.Despite the staggering death toll and wrenching misery of the violence in the Middle East, the broader economic impact so far has been mostly contained. Oil production and prices, a critical driver of worldwide economic activity and inflation, have returned to pre-crisis levels. International tourists are still flying into other countries in the Middle East like Saudi Arabia, the United Arab Emirates and Qatar.Yet for Israel’s next-door neighbors — Egypt, Lebanon and Jordan — the economic damage is already severe.An assessment by the United Nations Development Program estimated that in just three months, the Israel-Gaza war has cost the three countries $10.3 billion, or 2.3 percent of their combined gross domestic product. An additional 230,000 people in these countries are also expected to fall into poverty.Iranian-backed Houthi militants have been attacking commercial ships in the Red Sea.Sayed Hassan/Getty Images“Human development could regress by at least two to three years in Egypt, Jordan, and Lebanon,” the analysis warned, citing refugee flows, soaring public debt and declines in trade and tourism — a vital source of revenue, foreign currency and employment.That conclusion echoed an update last month by the International Monetary Fund, which said that it was certain to lower its forecast for the most exposed countries when it publishes its World Economic Outlook at the end of this month.The latest economic gut punches could not come at a worse time for these countries, said Joshua Landis, director of the Center for Middle East Studies at the University of Oklahoma.Economic activity across the Middle East and North Africa was already on a down slide, slipping to 2 percent growth in 2023 from 5.6 percent the previous year. Lebanon has been enmeshed in what the World Bank calls one of the world’s worst economic and financial crises in more than a century and half. And Egypt has been on the brink of insolvency.Since Hamas fighters attacked Israel from Gaza on Oct. 7, about 25,000 Palestinians have been killed by Israel, according to the Gazan health ministry. The strip has suffered widespread destruction and devastation. In Israel, where the Hamas attacks killed about 1,200 people, according to officials, and resulted in 240 being taken hostage, life has been upended, with hundreds of thousands of citizens called into military service and 200,000 displaced from border areas.In Jordan, Lebanon and Egypt, uncertainty about the war’s course is eating away at consumer and business confidence, which is likely to drive down spending and investment, I.M.F. analysts wrote.Rising prices in Egypt continue to gnaw at households’ buying power.Mauricio Lima for The New York TimesEgypt, the Arab world’s most populous country, has still not recovered from the rise in the cost of essential imports like wheat and fuel, a plunge in tourist revenue, and a drop in foreign investment caused by the coronavirus pandemic and the war in Ukraine.Lavish government spending on showy megaprojects and weapons caused Egypt’s debt to soar. When central banks around the world raised interest rates to curb inflation, those debt payments ballooned. Rising prices within Egypt continue to gnaw away households’ buying power and business’s plans for expansion.“No one wants to invest, but Egypt is too big to fail,” Mr. Landis said, explaining that the United States and I.M.F. are unlikely to let the country default on its $165 billion of foreign loans given its strategic and political importance.The drop in shipping traffic crossing into the Red Sea from the Suez Canal is the latest blow. Between January and August, Egypt brought in an average of $862 million per month in revenue from the canal, which carries 11 percent of global maritime trade.James Swanston, an emerging-markets economist at Capital Economics, said that according to the head of the Suez Canal Authority, traffic is down 30 percent this month from December and revenues are 40 percent weaker compared to 2023 levels.“That’s the biggest spillover effect,” he said.For these three struggling economies, the drop in tourism is particularly alarming. In 2019 tourism in Egypt, Lebanon and Jordan accounted for 35 percent to nearly 50 percent of their combined goods and services exports, according to the I.M.F.Displaced Palestinians on their way from the north of the Gaza Strip to its south last year.Samar Abu Elouf for The New York TimesIn early January, confirmed tickets for international arrivals to the wider Middle East region for the first half of this year were 20 percent higher than they were last year, according to ForwardKeys, a data-analysis firm that tracks global air travel reservations.But the closer the fighting, the bigger the decline in travelers. Tourism to Israel has mostly evaporated, further hammering an economy upended by full-scale war.In Jordan, airline bookings were down 18 percent. In Lebanon, where Israeli troops are fighting Hezbollah militants along the border, bookings were down 25 percent.“Fears of further regional escalation are casting a shadow over travel prospects in the region,” Olivier Ponti, vice president of insights at ForwardKeys.In Lebanon, travel and tourism has previously contributed a fifth of the country’s yearly gross domestic product.“The number one site in Lebanon is Baalbek,” said Hussein Abdallah, general manager of Lebanon Tours and Travels in Beirut. The sprawling 2,000-year-old Roman ruins are so spectacular that visitors have suggested that djinns built a palace there for the Queen of Sheba or that aliens constructed it as an intergalactic landing pad.Now, Mr. Abdallah said, “it is totally empty.” Mr. Abdallah said that since Oct. 7, his bookings have dropped 90 percent from last year. “If the situation continues like that,” he said, “many tour operators in Beirut will go out of business.”Travel to Egypt also dropped in October, November and December. Mr. Landis at the Middle East Center in Oklahoma mentioned that even his brother canceled a planned trip down the Nile, choosing to vacation in India instead.The top tourist site in Lebanon is the 2,000-year-old Roman ruins of Baalbek, said Hussein Abdallah, general manager of Lebanon Tours and Travels in Beirut. Now, he said, “it is totally empty.”Mohamed Azakir/ReutersKhaled Ibrahim, a consultant for Amisol Travel Egypt and a member of the Middle East Travel Alliance, said cancellations started to pour in after the attacks began. Like other tour operators he offered discounts to popular destinations like Sharm el-Sheik at the southern tip of the Sinai Peninsula, and occupancy hit about 80 percent of normal.He is less sanguine about salvaging the rest of what is considered the prime tourist season. “I can say this winter, January to April, will be quite challenging,” Mr. Ibrahim said from Medina in Saudi Arabia, where he was leading a tour. “Maybe business drops down to 50 percent.”Jim Tankersley More

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    The Austere Beauty of Egypt’s Long-Distance Hiking Trails

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    Ben Hoffler has heard one sound more than any other during the past dozen years: that of footsteps — crunch, crunch, crunch — pressing into the sandy gravel that carpets the desert valleys of South Sinai, a seemingly endless landscape of granite mountains, colorful canyons and verdant oases.While on a 2008 climb to the summit of Mount Sinai, Mr. Hoffler, an Oxford-educated Englishman, was so moved by the power of Egypt’s mountains — believed to be where Moses received the Ten Commandments — that he went on to traverse some 7,000 miles of this high desert wilderness with its Bedouin inhabitants.He wrote a trekking guide to South Sinai in 2013, and shortly after began working with the area’s Bedouin tribes to create one of Egypt’s most extraordinary tourism projects: the Sinai Trail, the country’s first long-distance hiking path.“There’s something very special about the desert — very harsh and austere and beautiful in a way that I don’t find in lush, easy-to-survive-in landscapes,” Mr. Hoffler, who’s 39 and resembles a young Elton John, told me during a walk on the trail just months before the Covid-19 pandemic upended global tourism.The first parts of the Sinai Trail opened in 2015. In 2018, it was extended into a 350-mile loop across the bottom half of the triangular Sinai Peninsula. Along with the Red Sea Mountain Trail, another long-distance path on Egypt’s mainland that Mr. Hoffler helped the Maaza tribe open in 2019, the trail has put Egypt firmly in the ranks of a booming hiking movement in North Africa and the Middle East.A safari truck navigates through the Red Sea Mountains.Sima Diab for The New York TimesNew trails throughout the regionOver the past 15 years, new long-distance trails, some inspired by America’s Appalachian Trail, have been developed in Lebanon, Jordan, Egypt and the occupied West Bank, ranging between 300 and 400 miles in length. Those routes joined lengthy trails already established in Israel and Turkey in the 1990s. Other long-distance trails are currently under development in Saudi Arabia, as part of futuristic megaprojects being created by the kingdom in its western deserts, and in the autonomous Kurdistan Region of Iraq.And now, some of the key players in the hiking movement in the region are envisioning clusters or transnational trails that, for the first time, would physically or symbolically link these rediscovered ancient nomadic pathways and newly forged routes, traversing modern national borders.For the past three years, Mr. Hoffler has been working in southern Jordan with Bedouin tribes and Tony Howard, a hiking and climbing pioneer in the region, to create a sister trail to the Bedouin-governed routes in the Sinai and the Red Sea Mountains. There has long been talk, though nothing conclusive has come of it yet, of a route that would link the Nabatean archaeological sites at Petra, in Jordan, and the Al Ula sites in Saudi Arabia, some 300 miles to the southwest. And a new long-distance trail network is taking shape to unite the Jordan Trail, the Palestine Heritage Trail and the Lebanon Mountain Trail, in a partnership with European backers and a trail system in France. All of this echoes the efforts of the Abraham Path Initiative, an American nonprofit that has been promoting trail building and trail networks in the region since 2007, though its main focus now is funding and supporting work on the Kurdistan trail.Separately, what many of the trails have in common is a determination by their creators to bring tourists and jobs to distressed villages in the deserts and mountains. These creators are also intent on preserving — and introducing to visitors, and their own citizens — long-overlooked natural wonders, and on using the trails to dispel negative perceptions of the historically turbulent region.Mohammed Muteer, a Bedouin guide, and Ben Hoffler start a fire and prepare tea.Sima Diab for The New York TimesAs a cluster, the embryonic network that includes the Jordan, Palestine and Lebanon routes could share best practices for the marking of trails, the establishment of emergency services and the cross-promotion of hiking, according to the organizers. Trekking exchanges, however, run into the reality of geographic and political impediments. Physically linking the trails in Jordan, Palestine and Lebanon, for example, is impossible, since Lebanon shares no border with the West Bank or Jordan. And the political obstacles seem equally insurmountable, since Israeli and Palestinian passport holders are barred from entering Lebanon.To Mr. Howard, who spearheaded the popularization of climbing and hiking in Wadi Rum, a valley in Jordan, in the mid 1980s, the orchestration of what he calls super trails in the region makes too much sense not to bring to fruition.“In itself, it’s an exciting thing — it sounds good, and it’s easy to promote, and people will walk it,” Mr. Howard said. But trails also benefit the areas they pass through by increasing tourism and helping to preserve both nature and culture. Before the trails were blazed, “there was very little realization in Jordan that people wanted to visit villages and walk hills,” he explained. “It started the need to protect some of these areas.”Mohamad, a Bedouin guide, leads a camel as it carries hikers’ belongings through a wadi along the Sinai Trail.Sima Diab for The New York TimesBedouin influences and originsAmong all the long-distance routes in the region, Egypt’s trails are unique in that they are owned and managed by Bedouins, whose nomadic ancestors, centuries ago, forged many of the pathways on foot and camelback. Unlike the self-guided trails in Lebanon, Israel and Jordan, the Sinai and Red Sea Mountain trails require Bedouin guides. And in contrast to the planned Neom megaproject in northwest Saudi Arabia, whose website promises 750 miles of trails in the coming years, features renderings of luxury chalets and boasts of “immersive digital experiences,” Egypt’s trails try to replicate how the nomads’ forebears moved through the wilderness. Hikers drink from wells, sleep fireside, under the stars (or in tents) and dine on flatbread baked in acacia coals and seasoned with mountain salt. The Bedouins are relying more on camels to haul the cooking and camping supplies and colorful woven rugs.The Sinai Trail was founded by Mr. Hoffler and three Bedouin tribes, whose members serve as guides, cameleers and cooks. And when it was extended in 2018, five more tribes joined the group. The tribes saw the trail as a way to create sustainable tourism while preserving ancient pathways and traditions that were fading in this era of smartphones and pickup trucks.The Bedouin guides on the trail say they find peace in the desert wilderness, feeling a strong connection to their tribes and lands. They know the way over sprawling passes and through mazelike gorges, which plants can be used to make soap and poultices, which animals leave behind what kinds of droppings and tracks. They also maintain the legends tied to the most prominent places on the route, like the tale of the sisters who tied their long locks of hair together and jumped to their deaths from Jebel El Banat, a mountain peak along the route, to escape arranged marriages.Clockwise from top left: etchings on a rock in the Red Sea Mountains near Wadi Nagaata; a hermit cell, also near Wadi Nagaata; a trail marker used by Bedouins to navigate difficult terrain; and a collection of pottery shards.An initial end-to-end hikeWhen I first met Mr. Hoffler in the autumn of 2019, I was joining a handful of trekkers on the first end-to-end hike of the Sinai’s western side — a 125-mile section reaching from Saint Catherine, a town and tourist hub in the center of the trail, to Serabit el Khadem, near the Gulf of Suez. We crunched along a high winding path of pea-size granite strewn with jagged boulders. To the left was a mountainside of crumpled dark granite; to the right was a soaring granite curtain in beige. Nearly 5,000 feet up, at the crest of the pass, called Naqb el Hawa, or Pass of the Wind, I almost expected to hear the swell of an orchestra as a far-off vista of sandy flats and striated peaks came into view.We were stepping on rock that dated back some 600 million years, on a footpath trod by nomads thousands of years ago and, around the sixth century specifically, by Christian settlers journeying from Cairo to Mount Sinai.“The desert has always been a place of insight, a place of transformation for people,” Mr. Hoffler said as we made our way down the pass. “All of the prophets, they’ve come out with very deep insights that have changed the course of human history.”The landscape continuously changes: from craggy olive hills to bulbous beige outcroppings, from charcoal gray peaks to rose-colored cliffs. Constants are the black veins of granite running through the mountains like arrows on a fever chart. Where two lines intersect near the base, the Bedouins tell us, there is certain to be water and a stand of flat-topped acacia trees.The ghost town of Um Bogma, along the northwest corner of the Sinai Trail.Sima Diab for The New York TimesShorter segmentsOf course, many visitors simply hike for a day or two on shorter sections of the trails, which feature dozens of desert valleys (known as wadis), sites of historic interest and named mountains.Atop my list of recommendations are hikes around Um Bogma, a ghost town atop rugged tablelands in the northwest corner of the trail, near the Suez Canal. An abandoned manganese mining camp run by the British in the 1900s during their occupation of Egypt, with breathtaking views of mountain ranges unfurling into the horizon, the tiered settlement of Um Bogma is frozen in time. Rusted steel cables stretch like ski lifts for miles down to the sea. Pitched-roof barracks have been stripped bare, as has a manager’s house with a wraparound porch overlooking a massive cliff that divides the Sinai.Members of the Hamada tribe, which oversees this section of the trail, extracted the manganese when the British occupied Egypt, until the 1950s. Egypt took over the Um Bogma mines for a number of years, but they were shut down, and the site abandoned, during the Israeli occupation of Sinai from 1967 to 1982.To some hikers, the scarred landscape is a legacy of colonial exploitation. To the Hamada, though, it was a source of jobs. And to Mr. Hoffler, it’s a rich opportunity for tourism. “I think this is just a jewel for the Hamada,” he told me.Julie Paterson, a trip organizer, and Jacobus Nederpelt, a hiker, at the summit of a 650-foot ascent through a mountain pass.Sima Diab for The New York TimesOther standout segments can be found in the Red Sea Mountains, a two-hour drive from the seaside city of Hurghada. Unlike in the Sinai, where you’re surrounded by mountains soon after landing in Sharm el Sheikh, the mountains in this section of mainland Egypt seem more jagged and imposing, clustered into massifs with fanglike peaks. Here, the government has not yet allowed overnight camping on the 100-mile Red Sea Mountain Trail, so the Bedouins can run only day hikes.The trail is contained within the territory of the Khushmaan clan of the Maaza tribe, and features Roman ruins and the mainland’s highest peak, Jebel Shayib el Banat, which rises to about 7,200 feet. The clan’s 1,500 families trace their origins to Arabia a few centuries ago, and most still live in the desert mountains, according to its leader, Sheikh Merayi Abu Musallem.At Wadi Abul Hassan, the hike starts up a steep slope blanketed by boulders and turns down into a secret enclosed wilderness — a narrow canyon lined with pink granite on one side and charcoal-colored granite on the other. Few outsiders have entered the wadi since the American academic Joseph J. Hobbs visited while researching his book “Bedouin Life in the Egyptian Wilderness,” in the early 1980s. The depth of perspective in the canyon is astonishing, especially when cottony white clouds in a sapphire sky and pyramid-shaped peaks in the distance add an extra dimension to the tableau.Elsewhere, the trek through Jebel Gattar and Wadi Nagaata is a strenuous climb up a series of massive granite shelves that reveal the historical origins of Christian monasticism. Atop the barren ledges are several hermit cells made of stacked rocks where, as early as the 300s, ascetics lived in extreme deprivation. Hikers can enter the silence of one of the small, semicircular chambers and imagine a contemplative looking out from the same entrance — toward a wall of beige granite honeycombed with scoop-like craters. On a nearby plateau stands a roofless, three-room stone building that was likely once a worship space, and a forerunner to the earliest monasteries, like Saint Catherine’s Monastery, built in the sixth century at the foot of Mount Sinai.Safety concernsDeveloping these trails was less about clearing new paths than it was about recovering existing routes that highlighted the myriad landscapes and legends. It was also about challenging the notion that the Sinai is a hostile and dangerous place. Egypt has been battling Islamist militants in North Sinai much of the past decade. The U.S. government advises against travel in Sinai. For the rest of Egypt, including the seaside resort of Sharm el Sheikh in South Sinai, the State Department advises citizens to “reconsider travel to Egypt due to terrorism.”According to the Sinai Trail’s website, “There has never been an attack on tourists in the interior Bedouin parts of South Sinai, where the Sinai Trail is.” Mr. Hoffler maintains that, in addition to Egyptian security forces across the peninsula, hikers have a safety net in an extensive Bedouin network that keeps tabs by camel, pickup and foot and shares information about visitors.One of our fellow hikers on the Sinai Trail’s western side, Leena El Samra, a 33-year-old from Cairo who works at a development bank, told me that some of her friends were worried about her taking the hike.Camels accompany hikers in places where support trucks can’t reach.Sima Diab for The New York Times“It’s a part of Egypt that’s ignored and we know nothing about, to some extent,” Ms. El Samra said, motoring through the gravelly sand. “This is a part of Egypt where you feel very safe with the people. It’s very nice, it’s pristine, it’s undiscovered. It’s very different than most of what we do all over Egypt. And I like building some muscles.”Ms. El Samra was among a small but growing circle of Egyptian adventure travelers and endurance athletes who turned to hiking, running and competing in triathlons after the failed revolution and subsequent military takeover early last decade. Many saw the activities as a way to release frustrations and exert their independence, or simply to discover their country.Hiking is still a niche activity in Egypt. The Sinai Trail hosted a few hundred hikers before the pandemic, which forced the trails closed for most of 2020. Numbers dwindled to the dozens in 2021 because of travel restrictions. But more hikers returned this year, including 70 people from around the world who arrived for a weekend hike in October tied to the United Nations annual climate conference, known as COP27, held the following month in Sharm el Sheikh. If all goes as planned, the Sinai Trail will host its first end-to-end hike of the 350-mile route next October.Returning to traditionsFor the Bedouins, the trails are a way to return to their roots and make a living in the mountains.During a drought in the 1990s, many Sinai Bedouins moved to coastal cities or farms in the Nile Valley for work, said Youssuf Barakat of the Alegat tribe, who spent two years with Mr. Hoffler mapping out the trail’s South Sinai routes and served as a guide during the COP27-related hike in October. Modernity and the collapse of tourism early in the last decade also pulled Sinai Bedouins away. Mr. Barakat, 36, returned to the mountains to work on the trail after working as a cook in his family’s restaurant in Abu Zenima on the west coast, he said.The Bedouins have been forced to change, Mr. Barakat told us after a dinner of grilled sheep and vegetable soup, which was followed by Mr. Barakat singing a traditional love song while thwacking a tabla drum.“We have internet, we have phones,” he said. Very quickly, he and his people have “become like the Egyptians,” he said.With the Sinai Trail, though, Mr. Barakat and his fellow tribespeople have an opportunity to return to their time-honored way of life.“We start step by step,” he said. “We hope in five, 10 years, the Bedouin life will come again.”A Bedouin guide makes tea and coffee over a campfire along the Sinai Trail.Sima Diab for The New York TimesPatrick Scott is a writer based in Thailand. You can follow his work on Instagram.Follow New York Times Travel on Instagram, Twitter and Facebook. And sign up for our weekly Travel Dispatch newsletter to receive expert tips on traveling smarter and inspiration for your next vacation. Dreaming up a future getaway or just armchair traveling? Check out our 52 Places for a Changed World for 2022. More

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    Ukraine War Strains North Africa Economies

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    Egypt imports most of its wheat from Russia and Ukraine, and is looking for alternative suppliers. And Tunisia was struggling to pay for grain imports even before the conflict.CAIRO — On the way to the bakery, Mona Mohammed realized Russia’s war on Ukraine might have something to do with her.Ms. Mohammed, 43, said she rarely pays attention to the news, but as she walked through her working-class Cairo neighborhood of Sayyida Zeinab on Friday morning, she overheard a few people fretting about the fact that Egypt imports most of its wheat from Russia and Ukraine.War meant less wheat; war meant more expensive wheat. War meant that Egyptians whose budgets were already crimped from months of rising prices might soon have to pay more for the round loaves of aish baladi, or country bread, that contribute more calories and protein to the Egyptian diet than anything else.“How much more expensive can things get?” Ms. Mohammed said as she waited to collect her government-subsidized loaves from the bakeryRussia’s invasion of Ukraine this week threatens to further strain economies across the Middle East already burdened by the pandemic, drought and conflict. As usual, the poorest have had it the worst, reckoning with inflated food costs and scarcer jobs — a state of affairs that recalled the lead-up to 2011, when soaring bread prices helped propel anti-government protesters into the streets in what came to be known as the Arab Spring.In a region where bread keeps hundreds of millions of people from hunger, anxiety at the bakeries spells trouble.In Egypt, the world’s top importer of wheat, the government was moving in the wake of the Russian invasion to find alternative grain suppliers. In Morocco, where the worst drought in three decades was pushing up food prices, the Ukraine crisis was set to exacerbate the inflation that has caused protests to break out. Tunisia was already struggling to pay for grain shipments before the conflict broke out; the war seemed likely to complicate the cash-strapped government’s efforts to avert a looming economic collapse.Harvesting wheat in Luxor, Egypt.Khaled Elfiqi/EPA, via ShutterstockBetween April 2020 and December 2021, the price of wheat increased 80 percent, according to data from the International Monetary Fund. North Africa and the Middle East, the largest buyers of Russian and Ukrainian wheat, were experiencing their worst droughts in over 20 years, said Sara Menker, the chief executive of Gro Intelligence, an artificial intelligence platform that analyzes global climate and crops.“This has the potential to upend global trade flows, further fuel inflation, and create even more geopolitical tensions around the world,” she said.After years of mismanaging their water supplies and agricultural industries, countries like Egypt, Algeria, Tunisia and Morocco cannot afford to feed their own populations without importing food — and heavily subsidizing it. In recent years, the number of undernourished people in the Arab world has increased because of the overreliance on food imports, as well as a scarcity of arable land and rapid population growth.Beyond its effect on the price of bread, the uncertainty and turmoil brought on by the war will push up interest rates and lower access to credit, which, in turn, would quickly force governments to spend more to service their high debts and squeeze essential spending on health care, education, wages and public investments, said Ishac Diwan, an economist specializing in the Arab world at Paris Sciences et Lettres university.He predicted a rise in economic pressure on Egypt, Tunisia, Jordan and Morocco, warning that Egypt and Tunisia in particular could see peril to their banking sectors, which hold a large share of the public debt.Egypt is also heavily dependent on tourism from Russia, which has helped its tourism industry recover from the Covid-19 pandemic, giving the country extra cause for alarm.Global inflation and supply chain issues stemming from the pandemic have also raised the price of pasta in Egypt by a third over the last month. Cooking oil was up. Meat was up. Nearly everything was up.But most important, bread, the cost of which had already risen by about 50 percent at non-subsidized bakeries over the last four months; a five-pound note (about 30 cents) now buys only about seven loaves of bread, down from 10, bakery employees said.Egyptians, about a third of whom live on less than $1.50 a day, rely on bread for a third of their calories and 45 percent of their protein, according to the Food and Agriculture Organization, a United Nations agency.Mona Fathy, 36, serving food to her children in her home, in the impoverished neighborhood of El-Ayyat in Giza, Egypt.Mohamed Abd El Ghany/ReutersGovernment officials said on Thursday that Egypt had enough grain reserves and domestically produced wheat to last the country until November. But because of rising import prices President Abdel Fatteh el-Sisi last year announced that Egypt would raise subsidized bread prices this year, risking public fury.“Of course I’m worried,” said Karim Khalaf, 23, who was collecting and stacking baladi loaves as they slipped out of the oven, steaming slightly, in a bakery in Sayyida Zeinab on Friday morning. “My salary hasn’t changed, but now I’m spending more than I’m making.”Morocco, where the all-important agriculture sector employs about 45 percent of the work force, is facing an economic crisis precipitated by global inflation, a surge of food and oil prices, and the worst drought in three decades.Anti-government protests that erupted on Sunday suggested that many Moroccans have lost patience with their six-month-old government as they struggle to make ends meet two years into a pandemic that annihilated the once-lucrative tourism industry.Understand Russia’s Attack on UkraineCard 1 of 7What is at the root of this invasion? More

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    Lebanon’s Financial Collapse Hits Where It Hurts: The Grocery Store

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    The country’s currency has sunk to a new low against the dollar, sending prices for once affordable foods soaring out of reach.BEIRUT, Lebanon — In normal times, Ziad Hassan, a grocery store manager in Beirut, would get a daily email from his chain’s management telling him which prices needed to be adjusted and by how much.But as Lebanon’s currency has collapsed, sending the economy into a tailspin, the emails have come as often as three times a day, ordering price increases across the store.“We have to change everything,” an exasperated Mr. Hassan said, adding that his employees often weren’t even able to finish marking one price increase before the next one arrived. “It’s crazy.”The country’s economic distress grew more acute last week as the Lebanese pound sank to 15,000 to the dollar on the black market — its lowest level ever — sucking value from people’s salaries as prices for once affordable goods soared out of reach. It has since rebounded to about 12,000.Lebanon has been grappling with a web of economic and political crises since late 2019 that have led to rampant unemployment, skyrocketing prices, road closures by angry protesters and a government with no clear plan to slow the descent. A catastrophic explosion in Beirut’s port in August, which killed 190 people and left a large swath of the capital in ruins, only deepened the misery.In a country where most products are imported, the currency collapse has left no sector unaffected.The catastrophic explosion at Beirut’s port in August last year has deepened the misery in Lebanon.Diego Ibarra Sanchez for The New York TimesFood prices had risen 400 percent as of December compared with a year earlier, according to government statistics, while prices for clothing and shoes had gone up 560 percent and hotels and restaurants more than 600 percent.Scores of pharmacies across the country went on strike last Friday to protest conditions that have left them without some medicines and cut into their profits. Professionals including lawyers, teachers, doctors and university professors have watched the value of their salaries shrink. Many others have been pushed into poverty.In August, the United Nations said that more than 55 percent of Lebanon’s population had become poor, nearly double the number from the year before. Extreme poverty had increased threefold to 23 percent. And the situation has worsened since.The crisis springs from the collapse of a policy by Lebanon’s central bank to keep the Lebanese pound, or lira, pegged to the dollar at a rate of about 1,500 to 1 since 1997. That allowed people to use the two currencies interchangeably and made it easy for merchants selling products in pounds to convert their profits into dollars to pay for imports.But the state’s ability to maintain the peg faltered in late 2019, when mass protests erupted over decades of political corruption and poor governance. Since then, two governments have resigned and the gap between the pound and the dollar has widened. Western and United Nations officials’ calls for reforms, which could unlock foreign aid and a potential bailout from the International Monetary Fund, have gone unheeded.For many Lebanese, the most personal element of the crisis is the grocery store, where products once considered staples have vanished and other essentials have tripled or quadrupled in price. There has been a run on staples like oil, flour, sugar and rice.“Everything is soaring,” said Suheir al-Jizini, 60, after realizing that the price of the jug of cooking oil she had bought last week was now two-thirds higher. “I’m really shocked.”Riot police standing guard in front of Lebanon’s Central Bank in Beirut last week during a demonstration over the rising cost of living and low purchasing power of the Lebanese pound.Wael Hamzeh/EPA, via ShutterstockShe had come to the store planning to also buy laundry detergent and pasta, but realized she didn’t have enough cash. She said her husband brought in 750,000 pounds per month as a driver. That used to be worth $500 but was now less than $60.The World Food Program said in November that food prices in Lebanon had increased 423 percent since October 2019, the largest jump since monitoring began in 2007. Prices have continued to rise since, putting acute pressure on the poor.Faten Haidar, 29, said she was struggling to pull together meals for her three children as food prices shot up and her husband’s earnings from his coffee stand declined. Speaking by telephone from the northern city of Tripoli, she said that she had only labneh — a strained yogurt — in the fridge and that she was already in debt to her local shop.“I don’t know how to pay them,” she said.Other essentials also depleted her funds, she said, like sanitary pads, whose price had quadrupled. That burden will increase when her 12-year-old daughter reaches puberty.“I can’t afford mine,” she said. “How can I afford hers?”The value of soldiers’ and police officers’ salaries has also fallen, heightening concerns that social unrest and crime will increase. This month, Mohammed Fahmy, the interior minister, who oversees the security forces, said those salaries had “reached rock bottom.”Stocking up at a gas station in Beirut. The price of fuel has also increased.Wael Hamzeh/EPA, via Shutterstock“Three months ago, I would have said the security situation is starting to break down,” Mr. Fahmy told a local news network. “Now, I am saying it has broken down.”Addressing military leaders, the head of the Lebanese Army, Gen. Joseph Aoun, earlier this month issued a rare public criticism of the leaders in Lebanon’s sect-based political system, warning them that his soldiers were also “suffering and going hungry.”Addressing the leaders, he asked: “Where are we going? What do you intend to do?”Parliament recently authorized a $246 million loan from the World Bank to provide cash assistance to poor families, but no significant efforts have been made to stop the wider collapse.The cabinet of the departing prime minister, Hassan Diab, resigned after the disastrous explosion in the Beirut port on Aug. 4 and has yet to be replaced. That has left the government operating in a reduced, caretaker capacity for longer than it was in power.A former prime minister, Saad Hariri, was designated in October to form a new government. But he has made little progress, despite 17 meetings to discuss political horse trading with President Michel Aoun. Last Thursday, they agreed to meet again on Monday.Jihad Sabat, 48, has watched the decline from the window of the Beirut butcher shop he has run since 1997. Over the last year, he said, the price of meat has kept rising while the number of customers has dwindled.A Beirut supermarket.Mohamed Azakir/ReutersA pound of beef now costs more than three times what it would have before the crisis, he said — more than three times what it cost before the crisis. He has also seen a rise in people wanting to buy on credit and interested in taking bones to boil for soup.“Meat has become a luxury,” he said.He accused the country’s politicians of stealing the state’s money through corrupt schemes and criticized them for failing to stabilize the economy.A friend hanging out in the shop interjected, “The problem is the people.” Mr. Sabat nodded.“That’s an essential point,” he said. “If there were elections tomorrow, the same people would be back.”In the grocery store, Mr. Hassan, the manager, said his branch sold less meat every month and more lentils, even though they, too, are imported and cost five times more than before the crisis.Fights have broken out in the aisles over staples like rice, sugar and cooking oil subsidized by the government, he said. And it is common for customers to get sticker shock in the checkout lane when they realize they can afford only a few essentials.“I don’t know how people keep going,” he said. “But it will eventually cause an explosion.” More