14 - 20 February 2002
Issue No.573
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Al-Ahram Weekly Online 14 - 20 February 2002 Issue No.573 |
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Shop till you drop?
The talk of the town has been the state of the economy, the crisis beforehand and the so-called 'fact' that nobody is buying. Yasmine El-Rashidi hits the streets and checks out what is really going on behind Cairo's cash registers
It looked much like a mid- December night in Manhattan, on this February evening in Cairo. Not because it was rainy, or snowy, or because there were Christmas lights and glitter sparkling through the street. Rather because it was swarming, with frantic shoppers hopping in and out of the horizon of shops lining Roxy's Baghdad street in Heliopolis. Bustling, in short, would have been an understatement on this exceptionally warm night.
Shoppers suffocated the streets, and shops, as the post-season sales began photo: Khaled El-Fiqi
"It's odd," Iman Youssef, a 24-year-old student of commerce armed with a fistful of plastic shopping bags told Al-Ahram Weekly. "We keep hearing about how no one has money, and there's nothing in the shops. But it's not true. It's the same as any other year."
She is seemingly right.
The street is literally suffocated with groups of young people, families, couples -- storming the street, the shops and, of course, the sales.
"The sales are incredible this year," Youssef says. "Maybe that's why. Everywhere has 50, 60, 70 per cent off. There are some very good deals. And people have to buy. They need things. The economy may not be great, but it doesn't mean that people have no money whatsoever."
In a way, the young commerce student has a point. For the average consumer, the wallet may be slightly trimmer, but it hasn't quite declared itself gaunt.
"One needs to take the situation and break it down to get a clearer understanding of the reality," Karim Naguib, a US-based Egyptian economist working for Allied Market Analysts Ltd (AMAL) consultancy firm, told the Weekly during his one-month visit to Egypt. "Everyone is going around saying, 'No one is buying because no-one has money'. It's the favoured assumption and analysis these days. That actually isn't the case. Is the general state of the economy shaky? Certainly. Have businesses and industries been affected by the global economic crisis? Of course. But have the mass of individual consumers been affected severely as a whole? Not in the way that everyone assumes."
A perspective intriguing in its individuality.
"It's very simple," he explains.
Simple in that tourism has been hit, oil revenues are moving in line with oil prices, and importers have been slapped hard across the face with the leap in costs caused by devaluation. Official figures shout deep that there is an outright economic crisis at hand. Tourism boasted revenues of $4.3 billion in 2000. Since 11 September, on the day touted to have "changed the world," tourism figures are down by 40-50 per cent. Figures show 290,000 visitors came to Egypt last October, down from 372,000 the previous month, and 497,000 at the same time the year before. The $2 billion earned in oil revenues last year is awaiting a similar fall.
"The economy as a whole is in crisis due to the sharp cut in revenues from its two leading sectors," Naguib elaborates. "Starting the beginning of this year, oil output was cut by 6.5 per cent. It comes as quite an assault on a market that was really taking strides towards elevating itself to a new plateau. For the local garment manufacturer there will be a slight fluctuation, but not as drastic as popular belief."
The shopkeepers agree.
"Sales slowed in the past few months, but we still had people," says Ahmed Tawfiq, shop manager of Seniora for ladies wear. "One felt that people were more reserved than before. But since the sales started this week it's like any other year. I think for the importers it's a problem. The boutiques that have foreign clothes are in crisis. Lots of them have closed down."
His shop, quite rightly, is packed.
"There are good deals," says one shopper, Olfat Mustafa. "Discounts seem bigger this year. Because of the crisis. It's a good opportunity to buy. And you can always buy and put things aside for next winter."
To the likes of Olfat and Iman, spending may have been cautious for a while. Halted in crisis would, however, be a misconception.
"We keep hearing about people's salaries getting cut, and people losing their jobs," Olfat says. "And so it makes you hesitate. I work in a school. My salary is the same. Yes, some things have become more expensive, but thank God things are okay. I feel the pressure because of what everyone is saying. We know people in tourism -- they're shattered. So one worries about what will come next."
The average consumer has a right, the experts say, to worry.
"Some companies have cut salaries by as much as 40 per cent," Naguib says. "Others have laid people off. Those affected so far are the ones that have some thread of business or investment tying them to international markets or goods. Then, of course, there are those who have felt the impact due to the repercussions of panic. It's that alert signal that goes off and sends everyone into a frenzy -- of cutting back on expenses and spending. That in itself is potentially detrimental to the local market and local goods. At this point, it's the main factor putting people into caution mode."
What comes next for both the local and international economy remains an enigma, dictated by the woes of global weariness, distrust and insecurity brought on by the attacks of 11 September. What comes next for the shops around the city, however, is a more predictable tale. Judging from the sea of shoppers -- bags in hand -- this end-of-season sales fiesta is likely to mean an upbeat end to a spell of cautious spending.
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