Monday, October 8, 2007

It's not just Jordan

One of the largest issues in Jordan that was discussed ad nasium was the issue of Iraqi refugees that have flooded into the country. Syria as well has been flooded with fleeing Iraqis. Egypt has gotten its fair share of Iraqi refugees, but because the country is so much larger to effects are not so immediately noticeable. It does of course put a great strain on the already hard-up Egyptian system.
The Daily Star recently published an article on exploding real estate prices in 6th of October City, dubbed New Baghdad. One of the largest issues in Jordan was the contrasting needs of the Iraqi refugees. Many of the first-wave refugees were well of Iraqis who pushed up inflation by dumping money into the economy. The second wave of refugees were the poorer Iraqis who had very little money, by law no job or education prospects, and no support networks.
Egypt is now beginning to (or at least it is finally being reported)face some of the issues that Jordan faced as the refugees first began pouring in.

CAIRO: With the influx of high-income Iraqi refugees to the Sixth of October City, the price of residential and commercial property has skyrocketed over the past two years.

Egyptians residents of the flourishing satellite city, 20 km southwest of Cairo, say the real estate market there was first a magnate for middle-class and low-income segments seeking low-income small flats. But with the advent of Iraqis fleeing sectarian violence in their country in 2006, the honeymoon was over: as they came in with their big money and plans to settle down and run a business, the prices shot up.

The City, now nicknamed “New Baghdad,” houses thousands of Iraqi refugees, Iraqi bakeries, coffee shops and restaurants serving special Iraqi food. Estimates place the community of Iraqis there at approximately 150,000.


The same phenomenon was occurring in Amman, where Iraqi refugees were buying up whole neighborhoods, although there much more affluent neighborhoods were being bought out and not middle class neighborhoods.

The negative effects on Egypt are immediately clear.

The increased prices have also taken a heavy toll on the prices of nearby government-subsidized housing set aside for low-income youth. A 70 square meter flat rose from LE 30,000 to LE 70, 000.

Observers argue that the government has exacerbated the crisis by facilitating the sale of Egyptian land to foreigners. This, they say, was not permitted in the past, neither was opening the real estate market to the rules supply and demand.

Radwan Abdel Rahman, an architect who designed many apartment blocks for Iraqis in Sixth of October City, blamed the government for not countering the sudden increase in demand for posh private villas for wealthy Iraqis and Gulf investors, with increased construction of budget housing catering for the low-income brackets.

In 2005 President Hosni Mubarak launched the National Housing Project (NHP) initiative to build 500,000 units for youth and low-income families across the country over the course of six years, a hallmark of his election campaign that year.

More than 20 private-sector companies have signed on to the project, "yet nearly two years later, almost no construction has taken place and the few buildings that are complete remain largely empty," said Abdul Rahman.


However not all the Iraqis coming to Egypt are wealthy, and "rich countrymen are few and the majority of Iraqis cannot afford buying and so they rent." This places intense pressure on the Iraqis who are stuck renting in an ethnic ghetto.
Egypt unlike Jordan or Syria is also facing another refugee crisis as Sudanese refugees flee their own country for a more stable country. I experienced this in the Mugamma a few weeks ago as the Sudanese stood in unending and pointless lines.

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