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Wednesday, February 23, 2011

United Arab Republic 2.0

With the ongoing unrest in Egypt, there has been speculation that the military, which is now in charge, might be tempted to launch a military adventure in order to unite the country behind them and position those advocating a pluralistic society as unpatriotic in a time of crisis. Most of the worry has been about a potential conflict with Israel, but with the rapidly deteriorating situation in Libya, what if Egypt's present rulers decided to roll the tanks West instead of East? This move would be taken “in order to secure the oil fields” and “in solidarity with our Arab brethren, who deserve protection from the tyrannical regime that has exploited them for so long”.

Pan-arabism has been a powerful force in the Arab world since World War II. In 1958, Nasser concluded a merger between Egypt and Syria to form the United Arab Republic (UAR), and factions in Iraq supported their country's joining the union. Rather than expand, the UAR collapsed in 1961 with the secession of Syria, although Egypt continued to call itself the UAR until 1971, when it officially changed its name back to “Egypt”, which is what everybody had been calling it all along.

Still, pan-arabism remained a popular sentiment in the region, and in the 1970s there were negotiations, initiated and supported by Libyan dictator Muammar Qadhafi, aimed at establishing a new union including his country, Egypt, the Sudan, and perhaps Syria. As Qadhafi was increasingly seen to be a dangerously irrational actor on the international scene and Sadat in Egypt moved to closely aligning his country with the United States, nothing came of these talks.

Looked upon as a business merger, a new union between Libya and Egypt (UAR 2.0) seems a “pretty sweet deal”. Libya's 6.4 million people would add less than 10% to Egypt's 80.4 million, and since Egypt's trade has been close to in balance recently (although it will surely take a hit in the near future until tourists feel it's safe to come back), Libya's 15.5 billion dollar trade surplus (almost entirely from oil and gas exports) would put the union squarely in the black. Libya has gold and foreign currency reserves of US$107 billion and just 6.3 billion in debt (3.3% of GDP), and without exhausting its reserves could pay off Egypt's entire external debt of 30.6 billion dollars along with its own and become a debt-free nation. Using a portion of the union's oil revenue to develop Egypt's poorly exploited agricultural potential could allow the union to become largely self-sufficient in food and resume Egypt's traditional rôle as breadbasket of the Mediterranean, further putting UAR 2.0 into the black and improving the standard of living of its population. Both countries share a language, predominant religion, and ethnic identification. Finally, Egypt has for millennia profited from tourism drawn to its antiquities sites and has become competent in monetising their attraction. Libya is rich in such sites, but few tourists visit them due to worries about safety and the primitive conditions in many of them. Egypt's experience could turn those sites into money makers as well. With Egypt's population, educational and cultural institutions, and military might combined with Libya's oil reserves and export revenue, the union would be the preeminent regional power.

Still looking at this as a business proposition, let's suppose that even as things spiral further out of control in Libya, those in power couldn't be persuaded of the advantages of UAR 2.0. What would a “hostile takeover” by Egypt entail? Well, one never knows in such matters, but just looking at the statistics, it looks like it would be a walk in the park or, more to the point, a dash across the desert. Libya has an army of around 50,000 men, half volunteers and half conscripts, equipped mostly with aging gear bought from the ex-Soviet Union in the 1970s and 80s. Many of the aircraft in the Libyan Air Force are believed not to be in serviceable condition.

Egypt, by comparison, has an army of 468,000 on active duty with another 480,000 in the reserves and fields (thanks to U.S. taxpayers) 1005 M1A1 Abrams main battle tanks which it produces indigenously under license. The Abrams is considered the preeminent tank in the world, and in addition Egypt also has 1435 M60A3 Patton tanks. And recall that, as generals Rommel and Montgomery demonstrated some years ago, the desert between Cairo and Tripoli is tank country. In the air, Egypt has 240 up to date F-16s. It is difficult to imagine a military conflict between the two nations lasting very long, and if the Egyptians prepare the propaganda battlefield so they are perceived as liberators, they may find support from the broad population and only a small number of regime hard-liners to suppress.

UAR 2.0—you heard it here first.

Posted at February 23, 2011 17:03