Egypt – Food Prices Rise; Distribution Breaks Down
January 31, 2011 · Posted in Global Economics
The New York times writes Political Crisis Starts to Be Felt Economically:
An army tank stands guard at the port of Alexandria to make sure no one gets in. The bigger problem is that next to nothing is going out.
For four days now, containers arriving on ships have been stacking up at Egypt’s largest port, shipping company employees and truck drivers here said. With distribution networks barely functioning and the Internet down since Thursday night, much of business in Egypt has nearly ground to a halt.
While protests remain at the center of attention, as jets fly over Liberation Square and escaped prisoners instill fear in the public, the political crisis could turn into a humanitarian one if the current economic paralysis continues.
“A big part of the production system is government-run, and this is frozen, including many of the bakeries making the subsidized bread,” said Hoda Youssef, an economist at the Arab Forum for Alternatives, an independent think tank, and a lecturer at Cairo University. “Here in the short term — today, tomorrow, the coming few days — we might have a serious problem with shortages of food, water and fuel,” Ms. Youssef said.