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Egypt Egypt's New Direction
In April 1974, Sadat presented what he called the October
Working Paper, which described his vision of Egypt's future. The
paper committed Egypt to building a strong country, continuing
the confrontation with Israel, working toward Arab unity, and
playing a leading role in world politics. Perhaps the most
important part of Sadat's paper was the announcement of a new
economic policy that came to be called
infitah, (opening
or open door; see Glossary and
The Role of Government
, ch. 3).
This new economic policy allowed increased foreign investment
in Egypt, greater participation by the private sector in the
Egyptian economy, more freedom for individuals to develop their
own wealth and property, and relaxed currency regulations so that
Egyptians could have access to foreign currency. The new
direction gradually changed Egypt in many ways: the shops filled
with foreign consumer goods; foreign companies built huge modern
hotels; and new wealth was displayed in a way that had not been
seen in Egypt since before the 1952 Revolution. Doubts began to
be expressed, however, about how much all this was actually doing
for the Egyptian people since foreign investment in long-term
agricultural or industrial projects was lacking.
In January 1977, Egyptians took to the streets in
antigovernment riots that demonstrated their disillusionment with
infitah and the nepotism and corruption it spawned. The
cause of the riots went back to late 1976 when Sadat, in an
effort to solve the country's economic problems, asked the World
Bank for loans. In response to the bank's criticisms of public
subsidies, the government announced in January 1977 that it was
ending subsidies on flour, rice, and cooking oil and canceling
bonuses and pay increases.
The result was immediate and shocking. On January 18 and 19,
there was rioting in towns from Aswan to Alexandria, variously
described as the biggest upheaval since the 1919 riots against
the British, or a second Black Saturday. It was the first time
the army had been brought into the streets since 1952. For
thirty-six hours, the rioters unleashed their pent-up fury on
targets that symbolized the yawning gap between the haves and
have-nots, the frivolity and corruption of the ruling class, and
the incompetence and insensitivity of the administration. The
rioters shouted slogans like, "Hero of the crossing, where is our
breakfast?" and "Thieves of the infitah, the people are
famished." There were also shouts of "Nasser, Nasser." In the
clashes between demonstrators and police, 800 persons were
killed, and several thousands were wounded, according to
unofficial estimates. The rioting ended when the government
canceled the price increases while retaining 10 percent wage
increases and other benefits for public sector employees.
Data as of December 1990
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