The rule of Mubarak (1981-2011)
Vice-President Hosni Mubarak became President on October 14 following the assassination of late Anwar As-Sadat in October 1981.There were some improvements in Egyptian foreign affairs during 1984; Egyptian diplomacy managed to overcome the antagonistic reactions to the Camp David agreements. Their new position on the Palestinian question was based on the argument that "any fair settlement of the Middle East question had to take into full account the rights of the Palestinian people" assuring that "Arab solidarity was the only way to recover the usurped rights".
From early 1985 the economic situation became more difficult as revenues from oil, emigrants’ repatriated pay, canal fees and tourism, considerably declined. Islamic Fundamentalism was very powerful in opposition and became increasingly so as the Government’s popularity plummeted.
Between 1980 and 1986 there was a significant increase in the role of foreign capital in the Egyptian national economy and US aid continued to be a very important source of income. The Government received almost $3 billion per year, $1.3 billion of which was spent on defence. The Egyptian foreign debt increased from $2.4 billion in 1970 to $35 billion in 1986.
Representing contact between the Arab countries and the United States, Mubarak proposed, in the UN General Assembly in September 1989, arranging an Israeli-Palestinian dialogue, with no prior conditions. In October of the same year, relations with Libya were renewed.
The Iraqi troops invaded Kuwait in August 1990; Egypt was among the first Arab countries to condemn the action and sent troops to the Gulf immediately. The US announced the cancellation of the Egyptian military debt (approximately $7 billion) upon launching the land offensive to liberate Kuwait in January 1991.
The foreign debt reached a record $40 billion in 1990. Per capita income averaged some $600 per year, with over a third of the population living below the poverty line.
In May 1991, the IMF approved a stand-by loan of $372 million to Egypt, conditional on an economic "structural adjustment plan". Cairo committed itself to privatizing State-run companies, to eliminating controls on production and investment and to reducing the current fiscal deficit from 21 per cent to 6.5 per cent of the GNP. In order to achieve these goals the government decided to cut back subsidies on food and other staples and to reduce the program of aid for the needy.
On May 15 1991, foreign minister and deputy minister Esmat Abdel Majeed was named the new secretary- general of the Arab League. The appointment of Abdul Majeed, who is now replaced by the former Prime Minster Amru Musa, signified Egypt’s recovery of its leadership role within the Arab world.
The escalation of violence from Islamic fundamentalist groups led the Government to enact an anti-terrorist law and extend the state of emergency, which had been in effect for the past ten years, for another three years. According to official statistics, this violence resulted in 175 deaths between February 1992 and August 1993.
In May 1994, the President formed a committee to organize political talks between the Government and opposition with the exclusion of communists, the Muslim Brotherhood and groups representing the Coptic minority.
Internationally, Egypt recovered its main role in the Middle East peace talks and in the sphere of political exchanges between Arab countries. A meeting was held in Alexandria in December 1994 involving leaders from Egypt, Saudi Arabia and Syria. In February 1995, a summit joining leaders of Egypt, Jordan, Israel and Palestine was held in Cairo.
In 1995, Mubarak was unable to find a solution to the confrontation with Islamic fundamentalists. In January, the Egyptian minister of interior, Hasan Al-Alfi attended a meeting of Arab countries’ interior ministers in an attempt to coordinate the fight against violence of the Islamic fundamentalist movements.
In November 1995, the ruling National Democratic Party won the parliamentary elections with the participation of all the parties acknowledged by the Government. Elections, held amid a violent atmosphere, granted 416 of the 444 seats at stake to the ruling party, which provoked several accusations of fraud. In January 1996, Mubarak appointed Kamal al-Ganzouri as Prime Minister, replacing Atif Sedki.
Attacks by armed Islamic groups continued throughout 1996 and 1997, along with government repression of all such groups, including those opposed to the use of violence, like the Muslim Brotherhood.