As Egypt's scheduled presidential election is due to be held in the spring of 2014, it is widely assumed that General Abdel Fattah el-Sisi is planning to run for the top office. Since the July coup that ousted Muslim Brotherhood candidate, former President Mohamed Morsi, the Egyptian state-controlled airwaves have been flooded with tributes to the military strongman, and its streets have been awash with a cornucopia of Sisi-related paraphernalia, ranging from chocolates to women's pyjamas bearing his visage. Whether he ultimately decides to run or not, this full-spectrum dominance of the propaganda space clearly indicates he is positioning himself to exercise the option.
As he does so, however, he would be well-advised to brush up on some economic analysis published in 2013 by the International Monetary Fund. In the study, which assessed the before-and-after performance of a range of economic indicators in countries that have experienced a political transition, there is some sobering news for would-be presidents eager to step into the power vacuum left by a crackdown on their political opponents. The message is simple: Political turmoil results in an extended period of economic under-performance, making the reins of power less a glittering prize than a poison chalice.
The IMF study examined the economic impacts experienced by countries that had undergone episodes of serious social and political instability over the past 30 years as a result of attempted or actual, regime change. To ensure a match with the economies of today's market-based Arab states in transition, they excluded the political upheavals that took place in the centrally-planned communist economies of Eastern Europe in the early 1990s. They also eliminated extreme cases, in which either full-blown armed conflict broke out, or the regime changed without any significant instability at all. In the resulting set of eleven countries, they tracked a range of key macroeconomic indicators (growth, investment, inflation, external and fiscal balances) for five years before the outbreak of political unrest, and for five years after.
The results were unambiguous: Economic outcomes deteriorated sharply across the board, with growth plunging, unemployment spiking, and lower investment, both public and private, following in their wake. Fiscal positions deteriorated as the gap between higher spending and lower revenues widened.
Foreign direct investment fell sharply, current account deficits widened, and international reserves declined. Moreover, recovery of these indicators was sluggish, in most cases taking the full five year time period to return to normal. But even these outcomes may be optimistic when applied to the case of today's Arab countries. The study also noted that weak demand from a struggling European market, high fuel and food prices, and the political un-palatability of some measures required to correct course (such as subsidy reform, a political hot potato that has long been kicked down the road in Egypt) could mean that transitioning Arab countries will perform even worse than the historical norm. In Egypt's case, the on-going political unrest and violence that has accompanied the military's crackdown on the Muslim Brotherhood, and which threatens to spawn a long-running insurgency, could dim prospects even further.
All of which should give Sisi pause as he considers cementing the Egyptian military's consolidation of power by assuming the presidency. The military's policy has long been to operate “behind the curtain”, controlling a vast business empire that may comprise 40 percent of the Egyptian economy, while remaining largely immune to public scrutiny or accountability.
Should Sisi win the presidential election (a near-certainty if he decides to run), he would risk placing himself squarely in the crosshairs of public discontent with Egypt's economic position, which the IMF study suggests is likely to remain widespread and intense for at least several years to come. If the recent past is any guide, the response by a resurgent Egyptian security state to any resulting unrest is likely to be further repression and restrictions on political inclusiveness. This, as I have argued previously, is a wholly unsustainable path, both politically and economically.
Egypt urgently needs to break the vicious circle of economic malaise and political exclusion. Taking the vast store of political capital Sisi has now accumulated, and applying it to the task of implementing the tough measures needed to place Egypt back on a path to economic recovery, would be its highest and best use. It would also, following the argument above, quite clearly be in Sisi's own political interest. But if, instead, this opportunity is used to entrench military rule and state domination of the economy for another generation, while plugging fiscal holes with easy money from counter-revolutionary allies in the Gulf, then Egypt's hard-won democratic opening will have amounted to little.
Scott Field is a Visiting Scholar at the Institute for International Studies, University of California, Berkeley.
The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera's editorial policy.