Egypt, the largest Arab country, has made little progress towards democracy
Egypt's vast territory consists of two main desert areas separated by the fertile Nile Valley. The western desert occupies around two-thirds of the country, a rocky sandy plateau with occasional inhabited oases. The eastern desert, with around one-quarter of the territory, is even less hospitable and more sparsely populated. The country's lifeline, the Nile, provides most of the water, and its valley and delta are home to more than 95% of the population.
Ethnically most Egyptians are the result of generations of intermarriage between Arabs and other groups. Most people are Sunni Muslims, but an important minority are members of the Coptic Orthodox Church, whose religion predates the Arab conquest, and who have a strong influence in both commerce and government. The Copts have also at times been the target of Islamic militancy.
Though some Egyptians have prospered, around 18% the population are below the poverty line. At least one-third of the workforce are unemployed or underemployed. Some four million Egyptians also work abroad, chiefly in the Gulf countries, sending home around $9 billion each year in remittances.
Around 30% of the workforce are still engaged in agriculture, mostly in small plots in the Nile Valley. With intensive applications of fertilizer, and manual irrigation systems, these farms are quite productive—though many are affected by waterlogging and salination.
One of the main crops is Egypt's high-quality, long-staple cotton, but output and export income have been in decline. The main food crop is wheat and production is intensive, but output is insufficient for a fast-growing population, and Egypt is one of the world's largest food importers.
To increase production the government has been reclaiming land from the desert; meanwhile these gains have largely been offset by losses to urbanization and industry. The largest scheme is the Southern Valley development project with an estimated cost of $86 billion.
Egypt's most important industrial enterprise is oil production. Though by Middle Eastern standards the reserves are modest, the oil and petroleum products from Egyptian refineries are still the main export earners, and recently the government has made further investment in gas. These industries, along with others like cotton spinning, are in the hands of state enterprises which employ around one-third of the workforce.
19,000 vessels per year through the Suez Canal
Within the service sector, one of the most important sources of income is the Suez Canal. Around 19,000 vessels pass through each year. Another vital service industry is tourism. Some 11 million people arrived in 2007, chiefly visiting the historical sights, spending $8 billion and employing two million people. The industry has, however, been vulnerable to the effects of terrorist attacks and political instability elsewhere in the region.
Since it became a republic in 1952, Egypt has never had a pluralist democracy. The early years were dominated by Gamel Abdel Nasser, who nationalized many industries, including the Suez Canal. He was replaced on his death in 1970 by Anwar el-Sadat. In 1978, Sadat established the current ruling party, the National Democratic Party (NDP). Sadat was assassinated in 1981 by Islamic terrorists and was replaced by the current president, Hosni Mubarak.