The ongoing conflict known as “Iron Swords” is a unique war in many ways. It has a multi-arena nature and affects countries that are not directly involved in the fighting. One of the countries most impacted by this war is Egypt, which is facing a severe crisis at a particularly difficult time.
The crisis caused by the Houthis in the Red Sea has resulted in significant damage to the Suez Canal, causing a 64% drop in traffic in the first two weeks of the year compared to last year. This drop has had serious financial implications, meaning that Egypt brought in about 47% less revenue compared to the previous year.
In response to this crisis, Egypt has asked the Houthis to focus only on attacks against Israel. However, the damage to the Suez Canal began to mount when the Houthis began targeting nearly all of the shipping giants.
Egypt’s debt crisis has been growing to more than 160 billion dollars over recent years, and credit rating companies have downgraded its credit image due to this crisis and other economic factors. To address this issue, Egypt is currently holding discussions with the International Monetary Fund to release additional aid funds. However, this has been challenging after last year’s aid package was stopped because Egypt did not carry out necessary reform measures.
Overall, “Iron Swords” presents a complex situation for Egypt and other countries involved, with multiple challenges affecting their economies and security.