Egypt appoints a new defense minister and swears in its reshuffled Cabinet

Egypt Appoints New Defense Minister in Major Cabinet Reshuffle Amid Economic Challenges

Egypt swore in a new defense minister and 13 other cabinet officials on Wednesday in a significant government reshuffle as the nation grapples with persistent economic difficulties and increasing regional tensions.

President Abdel-Fattah el-Sissi presided over the ceremony at the Presidential Palace, where Ashraf Salem took the oath as the new defense minister. The reshuffle, approved by parliament on Tuesday, affected several key portfolios including housing, higher education, communications, youth and sports.

Among the notable appointments, Ahmed Rostom, a senior World Bank economist, was named minister of planning, while Mohamed Farid Saleh, who previously chaired the Financial Regulatory Authority, now leads the Ministry of Investment. The government also restored the information ministry, which had been dissolved in 2021, with Diaa Rashwan, chairman of the State Information Service, taking the helm.

All new ministers were nominated by President el-Sissi, who met with Prime Minister Mustafa Madbouly before parliament voted on the changes. This marks the second cabinet reorganization within a year, following the previous reshuffle in July 2024.

The government overhaul comes as Egypt confronts multiple economic challenges that have intensified pressure on the country’s leadership. Egypt’s economy has struggled to recover from years of austerity measures implemented under an International Monetary Fund program initiated in 2016. The COVID-19 pandemic further strained resources and disrupted economic activity across sectors.

Compounding these difficulties, Egypt has felt the economic ripple effects from Russia’s invasion of Ukraine, which has destabilized global food markets. Egypt, as the world’s largest wheat importer, has been particularly vulnerable to price fluctuations and supply chain disruptions resulting from that conflict.

More recently, the Israel-Hamas war in Gaza has created additional regional instability along Egypt’s eastern border, affecting tourism and investor confidence. The humanitarian situation in Gaza has also placed diplomatic and logistical pressure on Egyptian authorities, who control the vital Rafah crossing.

Further straining Egypt’s economic outlook, Houthi rebel attacks on shipping in the Red Sea have severely impacted traffic through the Suez Canal, one of Egypt’s primary sources of foreign currency. Many shipping companies have opted for longer routes around Africa’s Cape of Good Hope rather than risk passage through the threatened waterway, causing significant revenue losses for Egypt.

Despite these challenges, there are modest signs of economic stabilization. The country’s annual inflation rate registered at 10.1% in January, a slight improvement from December’s 10.3%, according to the latest data from Egypt’s statistics agency.

In response to rising living costs, the government increased the minimum monthly wage earlier this year to 7,000 Egyptian pounds (approximately $138) from the previous 6,000 pounds ($118.58). However, this adjustment still leaves many Egyptians struggling with the cost of living as basic necessities remain expensive relative to average incomes.

The cabinet reshuffle appears to be part of a broader strategy to address these economic and security challenges with fresh leadership. The appointment of financial experts like Rostom and Saleh to key economic portfolios signals the government’s focus on economic reform and investment attraction.

As the new ministers take office, they face the daunting task of navigating Egypt through its complex economic landscape while maintaining stability amid regional conflicts that continue to threaten the country’s recovery efforts.