October 30, 2015
In echoes of Britain's support of Saddam Hussein in the 1980s along with the US, and Margaret Thatcher's thanks to August Pinochet for "bringing democracy to Chile", Britain will host Egyptian junta leader Abdel-Fattah el-Sisi on a state visit in November.
This follows a trip by British Defence Secretary and MP for Sevenoaks, Michael Fallon, to Egypt to attend the August 6 function for the opening of a new branch of the Suez Canal. Fallon, writing an op-ed in the local Egyptian state paper, hailed the 'rejection of authoritarianism' by the régime of Abdel-Fattah el-Sisi, while some 46,000 of the best minds and the most active people in Egypt languish in the régime's prisons on trumped up charges, in filthy conditions and without medical care. 176 of those are parliamentarians.
As Fallon towered over the pathetic figure of François Hollande at the ceremony, he seethed visibly as French Rafale fighter-jets screamed overhead. France had been looking for buyer for the Rafales for twenty years. Now the French defence industry is ahead of the British one. The $5.2bn Rafale contract signed in February effectively bails out Dassault, the French arms manufacturer. France will also relieve itself of two Mistral amphibious assault ships destined for Russia, but withheld from the Western antagonist due to European sanctions, bringing $1.1bn into state coffers from a further Egyptian deal.
David Cameron's appearance in Tahrir Square in the heady days of the Egyptian Revolution in February 2011, with eight arms dealers on his retinue, hadn't paid off. Perhaps this invitation to a state visit, extended on 17 June 2015, the day after the passing of the death sentence on incarcerated legitimate Egyptian leader Morsi, might now do the trick of squeezing yet more money out of the bankrupt country for arms sales.
The delaying of Sisi's visit to London until now resulted from fear of his arrest on charges of crimes against humanity. On 27 November 2014, following a High Court order, the British police was freed to begin investigating and prosecuting the Egyptian junta's war crimes, and has already begun to restrict the travel of certain Egyptian figures. The arrest in London in June of Rwandan general, Karenzi Karake, on war crimes charges filed in Spain was evidence that international jurisdiction cases where being effectively pursued in British courts.
But where African figures are always fair game, Britain Inc. protects Middle Eastern figures involved in crimes against humanity, because of the money it makes out of them. As in the case of his state visits to France and Germany, Sisi's state visit to Britain should have brought with it automatic immunity from arrest. However, the existence of a legitimate president in jail in Egypt fighting for his life complicated matters with the ongoing appeals in international capitals raised by the Egyptian Freedom and Justice Party.
In the period since June, British government lawyers have been working to ensure there would be no problems with Sisi's visit. Sisi's scheduled visit to Johannesburg on 10 June 2015 was cancelled for similar reasons, when South African lawyers called for the Egyptian junta leader's arrest. Unlike the British government, the South African government have not renewed the invitation. Egypt's expulsion from the African Union as a result of the 3 July 2013 coup had been rescinded as a result of heavy pressure from the Arab Gulf states and the West on behalf of Israel. African states are now no longer under the same pressure, because the new régime in Saudi Arabia is not such an avid supporter of Sisi as the old régime of King Abdulla.
So when you watch the video of Egyptian-American activist Mohamed Soltan, emerging from Egyptian jails having been abused and tortured, urging the UK and the West ahead of Sisi's state visit "not to remain silent and turn a blind eye to Egypt's glaring violations of international laws and conventions", you should know that Britain Inc. is not in this case being pressured by Arab Gulf states as before, and is following what it mistakenly sees as its own immediate interests in Egypt.
Fallon's hagiography in Egypt's state paper during in 6 August visit to the Suez Canal tells us how Sisi was about to "unveil a modern wonder". The new 40m wide lane added onto 35 of the 192 km length of the Suez Canal would allow ships to pass in both directions, and reduce waiting times to 8 hours from the current 18 hours.
The whole exercise had nothing to do with commercial opportunity, but was an attempt by Sisi to shore up his damaged reputation both at home and abroad. His 6 February call for mobs to go the streets in their millions to support a new crackdown on internal 'terrorism' as a show of virility to the 'international community' at the Davos conference had been met with deathly silence.
The Suez Canal project is now sinking Egypt financially. Shipping demand barely existed for the old capacity of the Suez Canal before its expansion. Furthermore, the massive $8bn expense of digging out this channel could not qualify as a good long-term investment, in view of the fact that enterprising Chinese carriers are now braving the arctic route in the summer months to cut 13 days off the trip from the Yellow Sea to Rotterdam via Suez. The rush to build the extension to the canal as a PR stunt had seriously deleterious effects.
Mohamed Aly-Hassan of the Kyoto Institute of Technology predicted the collapse of the Egyptian currency, as a result of the unstudied headlong dash to complete the crazy project, on his Facebook page on 18 October 2014. He points out that in its first phase the project, which had been due to excavate 341 million m3 of earth, hit a snag after just 40 of them, it was discovered that the Suez Canal Authority hadn't planned for the right sort of equipment to complete the project. This resulted in a doubling of costs, as the equipment had to be hired from foreign contracting companies at exorbitant cost.
Aly-Hassan's prediction was borne out when Egypt Central Bank Governor, Hisham Ramez, said, a year later to the day on 18 October 2015 that the country had run out of foreign exchange as a result of the Suez Canal Project. No sooner had he said that, Ramez was removed from his position and replaced with Tarek Amer, ex-head of al-Ahli Bank and close friend of Gamal Mubarak, the ex-president's son.
Embarrassed by this outcome to the Suez Canal project, Sisi decided to blame the collapse of the Egyptian currency on Muslim Brother leading figure Hassan Malik, who was arrested a few days ago on charges of currency manipulation. This accusation flies in the face of the fact that all of his assets had already been frozen by the state, and the 68 companies that make up his commercial group closed, as of 21 January this year. He has more or less house bound since.
Malik had not been arrested with the rest of the Muslim Brother leadership in the hope that pressure could be applied on him to back the new régime and swing public opinion. But his stubborn refusal to bend to the junta's will has created problems for Sisi.
Malik's 28-year old son Omar was consequently imprisoned and sentenced to death along with Muslim Brotherhood leader, Mohamed Badie, in order to force the father to the negotiating table. Malik's response to the new pressure was nevertheless and predictably negative, which infuriated the junta even more. The collapse of the currency together with the crushingly low turnout in the parliamentary elections, which were unchanged despite personal appeals by Sisi for the population to go out and vote, has resulted in a week of panicky reactions by the Sisi junta.
Mohamed Soltan had been sentenced to life in jail as part of the same batch of mass-sentencing of political opponents as Omar Malik, but was released because of his American citizenship. But clearly, Britain Inc. is unmoved by Soltan's video appeal against Sisi's state visit.
Britain Inc., Blair and the Rape of Egypt
Immediately after the 3rd July coup in Egypt, Tony Blair came out very strongly in favour of the military takeover in a TV interview. Although, Blair was no longer Prime Minister, he remained an essential member of the establishment, having dragged the country's main Labour opposition squarely into the conservative fold, not only [on] matters of geopolitics, but also on matters of neo-liberal ideology.
Blair's protected status is clear from his charmed life. Consider for instance that the Chilcot enquiry into Blair's actions in the Iraq War has run into the sand, and that the calls for a coroner's enquiry into the suspicious death of UN weapons inspector David Kelly under Blair had been ignored first by the coalition government, and then also by the new 2015 Conservative government, while the Hutton report into the death classified the evidence for 70 years.
For Britain, the Morsi government and the Muslim Brothers represented a serious obstacle. Under Mubarak, Britain Inc. was the leading foreign investor in Egypt, with BP and British Gas far and away the largest individual foreign investors in the country (Ismael and Perry 2013: 232). A BP-led consortium had been haggling over terms for drilling the West Mediterranean Deep Water concession for years. After the exploratory phase had ended, BP held out for unprecedented terms, which included direct ownership over the gas assets by the foreign consortium and accrual to them of 100% of the profits. The 2011-13 democratic experiment in Egypt had thrown a spanner in the works, however, with Hatem Azzam, secretary-general of the parliamentary industry and energy committee, objecting to these terms.
Blair ran a consultancy brokering gas deals in the East Mediterranean region, and was directly involved. The March 2014 Sharm el-Sheikh investment conference, set up to promote the road-map to democracy myth, was called by the New York Times, abetting Egypt's dictatorship. Its key figures and organisers were none other than Blair and Martin Sorrell, who is Chairman of the British WPP advertising and public relations conglomerate, and a business partner of Blair counsellor and spin doctor, Peter Mandelson.
It was no surprise that he only actual investment deal to be announced and to be signed after this essentially political event was the $12bn contract with BP for the West Mediterranean Deep Water concession. The whole sham event had been designed around it.
The failure of the Sharm el-Sheikh investment conference to bring other new business to Egypt was the major reason which led Sisi to decide on the expansion of the Suez Canal as a new PR stunt to impress the international business community.
All this has backfired, as the political situation has deteriorated and the war against the Sinai tribes expanded. We have already seen 13 multi-nationals leave Egypt in recent months, while 11 further companies are threatening disinvestment, with 855 factories closing and 3500 SMEs folding since the coup.
The short-sightedness of European régimes is therefore not limited to their policies in Libya and Syria. The situation in Egypt is potentially much worse. Hollande saving Dassault, Merkel saving Siemens, and Cameron saving BP/British Gas/Blair by propping up a raving lunatic representing a cabal of military figures totally unqualified to run a major economy on Europe's fringes, will blow up in all their faces on a scale they yet cannot imagine.
This junta is desperate and will resort to increasingly desperate acts to stay in power. Meanwhile, all those who are qualified to manage Egypt are either all in jail or in exile.
The strangest aspect of the saga is that most [of] the funding for the projects and for the sales of arms to Egypt discussed in this article is likely ultimately come from the European export credits. The problem for France, Germany and Britain was that European Union competition rules do not allow them to bail out their companies directly. These rules had originally been put into place precisely in order to stop a long history of bail-outs.
As Winfried Ruigrok and Rob van Tulder pointed out as far back as 1995 in The Logic of International Restructuring, at least 20 companies in the Fortune 100 would not have survived if they had not been saved by their respective governments (218). As Western economies careered into the 2007 crash, bail outs subsequently became a fixture of the Western state capitalism system.
The twisted logic of this system protects the socialisation of the Egyptian economy in favour a military clique, whilst condoning the wholesale imprisonment of its capitalists.
Omar Kassem can be reached through his website