5 Ways the Conflict in Sudan Can Affect Egypt Economy
On April 15 clashes broke out in Sudan resulting in unrest and fatalities exceeding 400 people, while more than 3500 people have been injured so far.
As a neighbor of Sudan with strong historical and cultural relations, how can this conflict affect Egypt’s economy? Here are 5 possible ways.
- Trade: The trade exchange between Egypt and Sudan reached almost $862 million in 2020. This will be greatly affected by the conflict, as well as trade between Egypt and African countries that has a route in Sudan. Businesses involved in trade across both sides will be affected.
- Investments: The regional instability caused by the conflict is likely to scare investors away from the whole region. Having a conflict in Egypt's Southern neighbor means more risk and economic volatility for investors, which will affect business trust and climate in Egypt.
- Refugees: A conflict in Sudan can lead to a refugee crisis, with civilians trying to escape the conflict and find safety in Egypt. Such a scenario can cause a lot of strain on the Egyptian economy, resources, and infrastructure, which are still suffering from the economic slowdown effects of COVID and the war in Ukraine.
- Tourism: The south of Egypt is a popular touristic destination that welcomes thousands of tourists every year. The conflict being close by can affect the tourism activity in areas like Aswan, Abu Simbel, Nubia, Lake Nasser, and Wadi Halfa, which means less tourism revenue for Egypt as a whole.
- Security: With an armed conflict close by, Egypt is likely to put resources into securing its borders on land and Red Sea and areas close to it. This can cause a lot of pressure on the economy which is already going through a crisis.