Introduction
While the world is becoming more fragmented and moving away from the current liberal international order (LIO), China and Egypt have been developing their bilateral relationship over the previous decade outside this liberal model. Having a complicated political and economic relationship with the West, Egypt has started to direct its main attention towards China. Facing high unemployment levels, it is essential that employment is stimulated to guarantee internal stability in Egypt. Egypt’s President El-Sisi has attempted to respond to these problems via the ambitious “Vision 2030.”
Over the last decade, China’s Belt and Road Initiative (BRI) and Egypt’s Vision 2030 have increasingly synergised, and the success of their symbiosis can have larger global implications. If Egypt has struggled to develop using the LIO’s strategies for decades but now sees success with its relationship with China, other countries from the Global South could follow suit, which would further fragment the current LIO. To clarify, the argument is not that Western developmental strategies are ineffective, but rather,in the age of global governance pluralisation, countries may find alternative avenues more attractive.
The last decade has seen an intensification of Sino-Egyptian economic interactions which has had a positive impact on Egypt’s economy overall. However, with Vision 2030 supposed to be completed in five years, the results of the previous nine years can still be characterised as underwhelming. The way it is currently standing, China can have a prominent role in Global South development, but it is also clear that there are many more factors that determine the development of a country.
The Liberal International Order
It is important to clarify what the Liberal International Order is and what its critiques within the Middle East are. Realist scholar John Mearsheimer (2019, p.9) defines an order as a structured network of international institutions that regulate interactions among member states. These institutions play a crucial role in establishing rules and norms that guide state behaviour. The present global order, known as the Liberal International Order, is fundamentally rooted in liberal ideas. Amitav Acharya (2017, p. 272) identifies four core elements that characterise this liberal framework: free trade, post-war multilateral institutions, the expansion of democracy, and the promotion of liberal values. Since the collapse of the Soviet Union, this order went from ‘Western’ to ‘international’ (Wu, 2018, p. 998).
However, upon closer inspection, many of the characteristics that underpin the LIO originate from the West. Liberal economics, democracy, enlightenment ideas such as universality and individuality all developed on the European continent and then consequently spread towards the United States. As O’Brien (2013) highlights, values are influenced by historical, cultural, and ethnic factors unique to a particular place. Values shape our understanding of the world, and they take decades or centuries to develop. If those values are unfamiliar, it takes significant time for a country to get accustomed to it. France, often regarded as the birthplace of modern democracy, became a democratic republic in 1793 (Popkin, 2021). However, it was not until 1958 —when Charles de Gaulle drafted the constitution of the Fifth Republic—that the country finally achieved a stable and enduring democratic system (Élysée, 2022).
With the United States being the main architect of the LIO, the main values that are found within this order are thus Western. However, what happened was that these values came to globally dominate the way things are done (Wu, 2018, p. 998-999). In many cases it became the only way things would or should be done and this is where its main critiques emerge (Acharya, 2017, p. 271). Every country has its own values and is uniquely different, but the LIO did not act as inclusive as it promoted itself to be (Peng and Tok 2016, p. 738).
The post-Cold War Middle East did not transition towards a liberal democracy through an organic long-term process; instead, it was hastily pressured into it—both politically and economically. In extreme cases, military interventions such as in Iraq, Libya, and Afghanistan were conducted to impose liberal democratic systems (Mearsheimer, 2019, p. 27- 28). Lacking the necessary foundations needed for such a system to function, these democratic transitions quickly proved to be a failure. From an economic perspective, during the late 1980s and early 1990s, international financial institutions like the World Bank and IMF offered financial aid to struggling economies, but only under the condition that they adopt neoliberal economic policies through the so-called Structural Adjustment Programs (Bogaert, 2002, p.2; O’Brien and Williams, 2016, p. 150; 229). With no other alternative, Middle Eastern countries had to accept these terms and significantly overhaul their economic system.
Hence,, the core issues with the Liberal International Order (LIO) in the Middle East is that becoming a liberal democracy is a gradual process that typically unfolds over a long period; however, in the Middle East, it was hastily imposed economically around the 1990s, while militarily in the 2000s (Mearsheimer, 2019, p. 30-33). This top-down method of expansion and the failures that arose from it created resentment towards the Liberal International Order. Moreover, the LIO’s consistent alignment with Israel has reinforced the perception among Middle Eastern countries that power within the system is disproportionately concentrated in the hands of Western nations and their preferred values (Mearsheimer, 2019, p. 28). The growing discontent with the liberal order provides crucial context for understanding China’s increasing appeal in the region, as it offers countries greater flexibility in shaping their own governance models and policy choices without external pressures to conform to a singular ideological framework.
Egypt and the Liberal International Order
Egypt’s political-economic landscape has evolved significantly, from Nasser’s non-aligned, and Pan-Arabist policies to Sadat’s economic liberalisation and closer ties with the West. However, Egypt’s formal integration into the Liberal International Order began under President Hosni Mubarak.
Facing mounting debt, which originated from Nasser’s unsustainable socialist policies, President Mubarak sought financial assistance from the World Bank and IMF in the late 1980s. The Structural Adjustment Programs that Mubarak had to accept aimed to transition Egypt’s economy to neoliberalism by cutting public subsidies, privatising state enterprises, and promoting trade liberalisation (Cammett, et al, 2015, p 294; Frerichs, 2016, p. 613).
Egypt’s neoliberal reforms initially delivered promising results, with GDP growth averaging 5% annually between 1994 and 2000 (Cammet, et al, 2015, p. 294). However, beneath this economic success lay deeper structural issues. Many of the challenges stemmed not only from Egypt’s internal governance problems -such as high levels of corruption- but also from the shortcomings of the IMF and World Bank in tailoring reforms to local realities. At that time these institutions often prioritised their economic models over the unique socio-political contexts of recipient countries, leading to unintended consequences (Bogaert, 2013, p. 3-4; Barnett and Finnemore, 1999, p. 723). For example, the privatisation efforts disproportionately benefited the elite, with state-owned enterprises falling into their hands (Cammet, et al, 2015, p. 279-280). Nonetheless, it should be acknowledged that these institutions have learned from these mistakes (Cammet, et al, 2015, p. 281).
The reforms focused on tariff reductions, deregulation, and decreased state support for domestic industries. Intended to foster competition, these measures proved detrimental to small businesses that could not compete with large international players as trade restrictions were removed (Hanieh, 2013 p.56-57). Western institutions and governments, meanwhile, continued to support Middle Eastern regimes that implemented neoliberal reforms, overlooking their increasingly authoritarian tendencies (Hanieh, 2013, p. 64-65). The rationale was that a strong, centralised leadership could push reforms through more efficiently by passing political and public opposition.
Despite positive macroeconomic indicators, these reforms failed to address the needs of the broader population, fueling growing dissatisfaction (Bond, 2011, p. 486-488). Egypt’s economic integration into the LIO did not deliver the expected prosperity, particularly for the middle and lower classes. Mounting frustration with economic hardship and inequality contributed to Egypt’s revolution in 2011, which led to the removal of President Hosni Mubarak. While neoliberalism was not the sole cause of the revolution, it was a critical factor that shaped the conditions for the event. The removal of the president was followed by a new turbulent era in Egypt’s history, where eventually Egypt’s new president, Abdel El-Sisi, came on top and has reigned since 2014.
Present Day Egypt
President El-Sisi inherited a country in shambles. In 2014, the country had a population of 97 million (117 million in 2024), where around 66% of all unemployed people are aged between 15-29 (World Bank, n.d a.; UNICEF, n.d.). This, together with other economic problems, shapes the troubling position President El-Sisi finds himself in. In early 2016, President El-Sisi came up with his solution: Egypt Vision 2030.
Vision 2030’s goal is to reestablish Egypt as a leading regional power by positioning it among the world’s top 30 economies by 2030. This long-term strategic plan focuses on a comprehensive restructuring of the country's economic, social, and environmental sectors in a way that ensures sustainability and inclusiveness. It aims to tackle key challenges such as corruption, poverty, environmental degradation, and inadequate infrastructure that continue to hinder Egypt's progress (Chen, 2018, p. 220-221; Matambo, 2019, p. 6).
This time, however, marks a significant shift. China and its institutions now lead developmental assistance, presenting an alternative to the Western-dominated international order. While not a zero-sum competition, Chinese developmental institutions have significantly gained prominence in supporting Egypt's goals.
For Egypt, much of China’s appeal lies in the fact that the two countries do not share a long and complicated history in comparison with the West (Fulton, 2019, p.2). China's ‘selling point’ can be seen as a direct response to the critiques and shortcomings of the LIO (Wu, 2018, p. 999). For instance, China upholds an apolitical stance on domestic and regional issues in the MENA region, where it prioritises economic relations instead (Fulton, 2019, p.3). Additionally, China’s alternative to the World Bank, the Asian Infrastructure Investment Bank (AIIB), has consistently criticised the controversial conditionality of Western loans (Rakhmat, 2020; Peng and Tok, 2016, p. 740). For a country like Egypt, which has experienced the failure of the Structural Adjustments Programs, a more lenient funder that does not hold normative conditions is therefore highly attractive (Mohamed, 2023).
For China, building a strong economic relationship with Egypt is not only beneficial for guaranteeing access into a giant developing market, but also to leverage Egypt’s geostrategic position within the world economy (Chen, 2018, p.232). With Egypt having control over the Suez Canal and being the only connector to Africa from Eurasia by land, a strong Sino-Egyptian relationship is strategically beneficial for the Belt and Road Initiative to spread into Africa (Al-Anani, 2023; Mohamed, 2023).
Sino-Egyptian Economics
There are two main problems that need to be acknowledged. Firstly, COVID-19 seriously delayed Vision 2030 projects. Secondly, much of Egypt’s data on its spending or construction progress remains covert (Arabi, 2024). Media headlines frequently highlight deal signings between Egypt and China, but there's a critical gap in tracking these deals' actual implementation and outcomes. To stay sharp, it is important to differentiate between ‘what might happen’ and ‘what has happened.’ For the most part, Vision 2030 projects still fall under the former. Nevertheless, there have been developments:
The SCZone, a key Vision 2030 project, aims to transform the Suez Canal region into a commercial hub with industrial, technological, and agricultural zones (Chaziza, 2019, p.259). Located within the region, the China-Egypt Suez Economic and Trade Cooperation Zone hosts more than 160 Chinese companies, generating over seventy thousand jobs for Egyptians. China's position within the SCZone continues to expand, as it was announced in December 2024 that Chinese investments have totaled three billion dollars, representing 40% of all foreign direct investment in the past two years (Taylor, 2023). While not solely due to China’s involvement, the SCZone has seen yearly increases in revenue, a 36% growth in fiscal year 2023/2024 when compared to the last (State information Service Egypt, 2024).
China’s largest constructed project in Egypt - with its size rivaling that of Singapore - has been Egypt’s New Administrative Capital. Announced in 2015, it completed its first phase of construction in 2023 (Hundeyin, 2024). Although the project has been controversial due to reasons that are beyond the scope of this piece, the success of completing a mega-project of this size is notable as it provides concrete evidence on the progress of BRI-Vision 2030 projects. In 2022, the Ramadan Light Rail Transit was completed, linking the New Administrative Capital to the city of 10th of Ramadan. The following year saw the completion of the Haier Egypt Eco-Park, and in January 2024, the Abu Qir Marine Port Container Terminal in Alexandria started its operations (China Railway Group Limited, 2022; Haier, 2023; Xinhua Net, 2024).
Looking at the economic trends between Egypt and China, the last decade has seen an ongoing intensification of economic relations. China is Egypt’s biggest trade partner. From 2017 to 2022, Chinese investments in Egypt have increased by 317% while U.S. investments decreased by 31% (Maher and Farid, 2023). Egypt’s imports from China doubled from 8 billion dollars in 2017 to 14.4 billion dollars in 2022, while Egypt’s exports towards China went from 693 million dollars in 2017 to 1.8 billion dollars in 2022 (ibid.). However, Egypt’s exports to China have largely been energy-based, rising from 31% in 2014 to 56% in 2022, which does bring up concerns regarding a lack of improvement in export diversification (Fulton, 2025).
Rejecting the IMF
Since President El-Sisi came to power, state capitalism and military involvement within the economy has deeply consolidated itself (Abdallah and Jiránková, 2024, p. 8). Interestingly, at the turn of the decade, there has been a significant development in Egypt's economic landscape. Despite heavy reliance on financial support from global institutions like the IMF and World Bank, Egypt has continuously decided to not follow the reform commitments it agreed to. Yet, even though the IMF is aware of this, the institution continues to provide loans and assistance. As Sayigh (2025), a senior fellow at the Malcolm H. Kerr Carnegie Middle East Center in Beirut, points out, this suggests that the primary motivations for the IMF are now driven by political considerations rather than genuine economic reform. Their leadership – particularly in the IMF, which is heavily influenced by U.S. interests – continues to prioritise strategic political agendas (ibid.). This highlights that the U.S. is aware of Egypt’s reorientation towards China and is trying to keep them at least to some extent within the LIO due to Egypt’s strategic location within the world economy.
With no external or international pressure, Egypt’s military economy will continue to be a burden on Egypt’s social spending and private sector development, thus reducing resource availability (Abdallah and Jiránková 2024, p. 15). These problems will remain a hindrance for Egypt’s development. But, at least for now, El-Sisi’s Egypt has seen a positive development in its unemployment problem. Since becoming president, the unemployment rate has dropped over the last decade. Going from 13.1 percent in 2014 to 7.3 percent in 2023 (World Bank, 2024b). Youth unemployment has fallen from 32.2 percent in 2014 to 19 percent in 2023 (World Bank, 2024c). Egypt’s Vision 2030 megaprojects are a key factor for this drop in numbers (Allam, 2023). However, how sustainable this will be in the long run remains to be seen. For the millions that were previously unemployed, working in these large projects is not a choice of their own, but a necessity to survive. Egypt sees over half a million students graduate from university annually, but there remains a significant lack of employment options for highly skilled workers (Khalid, 2023).
Conclusion
It is evident that much more analysis is required for a holistic understanding of the situation. However, the economic analysis that was presented in this piece suggests that China’s involvement can so far be seen as fairly positive in terms of meeting Egypt’s developmental goals. Yet, it is also important to keep a critical eye on the matter. After almost a decade of cooperation and many deals announced, there remains a fundamental lack of information regarding their progress. With only five years left for realising Vision 2030, there is still a very long way to go when one compares what has been promised to the current economic status of Egypt.
Nevertheless, the shifting power dynamics between Egypt and the IMF reflect the gradual fragmentation of the liberal international order. In contrast to the early 1990s, when Egypt had little choice but to comply with the strict conditionalities attached to IMF loans, its more assertive stance today—despite financial constraints – suggests a weakening of the IMF’s influence and, more broadly, a decline in the Liberal International Order’s ability to enforce its conditions.
This article does not necessarily reflect the opinions of European Guanxi, its leadership, members, partners, or stakeholders, nor of those of its editors or staff. They have been formulated by the author in their full capacity, and shall not be used for any other purposes other than those they are intended for. European Guanxi assumes no liability or responsibility deriving from the improper use of the contents of this report. Any false facts, errors, and controversial opinions contained in the articles are proper and exclusive of the authors. European Guanxi or its staff and collaborators cannot be held responsible or legally liable for the use of any and all information contained in this document.
ABOUT THE AUTHOR
Rifat Šestić is a researcher specialising in the political economy and geopolitics of China, with a particular focus on its relations with the Middle East and the broader international order. He holds a Bachelor's degree in International Studies, specialising in Middle Eastern studies, from Leiden University, and a Master's degree in Transnational Governance, with a specialisation in International Political Economy and Regulation, from the European University Institute. As a Research Assistant at the Policy Center for the New South, he examined China's Belt and Road Initiative in comparison to the European Neighbourhood Policy, contributing to analyses on global governance and regional economic strategies.
This article was edited by Sardor Allayarov, Kalos Lau. and Agnes Monti.
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