Revisiting Egypt's Warning

Adam Taggart
By Adam Taggart on Wed, Jul 3, 2013 - 7:46pm

In light of today's unfolding events in Egypt, it's worth revisiting the analysis Chris wrote 2 years ago during the overthrowing of the Mubarak regime.

While the power players are now different, the underlying factors persist. 

How unbalanced was Egypt? Very.

Here are a few quite relevant statistics about Egypt (hat tip to an email from reader Mark O., with credit to Dr. John Coulter) to which I have added a few items:

The relentless math:

Population 1960:  27.8 million
Population 2008:  81.7 million
Current population growth rate: 2% per annum (a 35-year doubling rate)
Population in 2046 after another doubling:  164 million

Rainfall average over whole country:  ~ 2 inches per year
Highest rainfall region:  Alexandria, 7.9 inches per year
Arable land (almost entirely in the Nile Valley):  3%
Arable land per capita:  0.04 Ha (400 m2)
Arable land per capita in 2043: 0.02 Ha
Food imports: 40% of requirements
Grain imports: 60% of requirements

Net oil exports: Began falling in 1997, went negative in 2007
Oil production peaked in 1996
Cost of oil rising steeply
Cost of oil and food tightly linked

The future of Egypt will be shaped by these few biophysical facts -- a relentless form of math that is hardly unique to Egypt, by the way -- and it matters very little who is in power.

The interesting part is that these facts have been in plain view for decades, building into economic and social pressures that were suddenly unleashed in a wave of social and political unrest. How was it that such obvious things escaped notice for so long before they suddenly reared up into plain view? Instead of being a surprising exception to the rule, we should instead brace ourselves against the idea that this is just the way things tend to work. 

Back to the main story. Without persistent (and rising) food imports, Egypt cannot feed itself. It has managed to cover up the shortfall by having enough oil to export, but, like every country, their oil reserves are finite and eventually they'll face a day of reckoning.  

The oil situation in Egypt has only very recently become an enormous and unavoidable issue.

The re-emergence of political turmoil we're witnessing is quite predictable from the "relentless math" Chris laid out. Or perhaps more directly put: resources don't care about politics.

Meanwhile, world oil prices are beginning to creep higher, as are prices of the precious metals (though not as much as they have historically in reaction to such geo-political risk). Strangely enough, equity markets have yet to show much concern for Egypt's troubles. Or Portugal's, Or Greece's. Or Brazil's. Or Turkey's. Etc....

That could change quickly.

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6 Comments

jasonw's picture
jasonw
Status: Diamond Member (Offline)
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Importing food

Another example of a sleeping giant in search of food is India.  Came across this article today about India's government launching a massive food program to provide cheap grain every month to nearly 800 million poor people.

India launches huge cheap food programme ahead of election

Promises and programs that TPTB can't afford?

to_be_frank's picture
to_be_frank
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Posts: 11
Arable Land May Decrease Faster

Due to urban development associated with population growth, at least some of the existing arable land will no longer be arable in the future.  If the population were to double in 35 years, I suspect the forecast of arable land per capita at 0.2 Ha is overly optimistic.  That does not even consider the adverse effects that climate change could have on Egyptian agriculture.

to_be_frank's picture
to_be_frank
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Not Enough Gold in India to Fund That Election Promise

Jason - That article put into stark perspective the problem that India faces in providing affordable food to its population.  800 million poor is almost 10 times Egypt's population, and the proposed annual subsidy would be $23.9 billion to feed them.  If India sold its entire official gold reserves (Dec 2012) of 577 tonnes, at $1,250/oz, that would raise $25.4 billion, which would barely cover the first year of the program.  Maybe they will end up printing money like everybody else.

davefairtex's picture
davefairtex
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Joined: Sep 3 2008
Posts: 5459
some other egypt factoids

Average Age: 25 [US: 37]

Food Budget of total income: 41% [Mexico: 24%]

Per Capita Annual Income: $6557 [2x India, 40% Mexico, 65% Thailand]

GINI Coefficient: 35 [Ireland, Greece, Italy]

Government Corruption Index: 67, similar to Greece/Thailand/Mexico/China

So they are young (which helps explain all the protesters), quite poor, with a relatively corrupt government, and they spend 41% of their income buying food, a huge amount.  Together with Chris's information, projecting the situation forward, it seems difficult to see a happy ending.  Especially given the almost complete lack of arable land combined with the population doubling.  The GINI coefficient of 35 says even if they redistribute the wealth, it won't be all that much help.

 

JadeQueen's picture
JadeQueen
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Joined: Nov 16 2009
Posts: 12
Greening the Desert

The best chance Egyptians have, and maybe someone in the army will have relatives who know of this, is to reshape the land near the Nile to hold water better and to use biomass as mulch to plant through nitrogen-fixing trees and fig trees, to begin with. Some here may already have seen Geoff Lawton's video of greening cracked, salted, hardpan in the Dead Sea area of Jordan. Geoff has also spoken in different parts of north Africa. Geoff's wife is Jordanian. A terrible concern though, as expressed by Ron Paul, is that the military in Egypt has been supplied by the U.S. The U.S. military has different components, which seem like countries to themselves from an outsider's point of view. It is difficult to know which parts of the military is there, but it is not a happy mystery to contemplate. Another looming problem is the possibility of dam-building above Egyptian land. The entire area would benefit from better water-management from diversiculture (French) or permaculture experts on water, nutrient, and energy management.

Arthur Robey's picture
Arthur Robey
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Posts: 3936
Sporosarcina pasteurii

 pasteurii has been proposed to be used as an ecologically sound biological construction material.

Wiki.

Magnus Larson.

 

and 

Although this is more in the Sahel

Source

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