Storm or Blessing? The War’s Impact on North African Regimes
Gianni Del Panta 27 April 2022

Over the last two months, the expression “regime change” has really been at the top of the political discourse, becoming popular well beyond the restricted circles of journalists and scholars. It was the beginning of the Russian military invasion of Ukraine that played a critical role in this regard. Especially during the very first days and weeks of the conflict, “regime change” was used in reference, either to the rapid fall of Volodymyr Zelenskyy and the installation of a Moscow-controlled proxy puppet government, or a supposed palace coup against Russian president Vladimir Putin. Although neither of these scenarios has emerged, it is interesting that the political effects at the regime level of the war in Ukraine have been prevalently understood as geographically limited to one of the two countries directly involved in the armed conflict. It might be the case, however, that the shocks – first and foremost, economical – of a new, devastating war in Europe could be felt far beyond the Old Continent. In this light, the rise in prices of wheat and raw materials is arguably the most widely understood, but not unique, development.

This article explores whether, and to what extent, the Russian war in Ukraine is likely to strengthen or weaken regimes in North Africa. The general theoretical assumption is rather basic and starts from the view that scholars and analysts should move beyond methodological nationalism, which restricts politics to a country’s internal dynamics, to demonstrate how, in a very globalized capitalist economy, what happens thousands of miles away can impact on domestic politics. To be sure, this does not happen mechanically, and a multitude of factors co-determine whether a latent crisis might evolve into an existential threat to rulers. After all, even the weakest political regime is likely to remain in power as long as opposition forces or some disloyal fractions of the ruling coalition do not challenge it. By bearing these important caveats in mind, this article identifies three different types of countries in North Africa.

First is the case of Algeria, which is likely to indirectly benefit from the armed conflict in Ukraine. Secondly, there are regimes such as Morocco and Libya that will suffer in a limited way from the economic impact at the global level of the war. Thirdly and finally, it seems that Egypt and Tunisia, two net and large importers of wheat from Russia and Ukraine, could be affected the most. The rest of the article deals with these three general situations.


Why Algerian ruling elites thank Vladimir Putin

Since the 1970s, Algeria has emerged as a classic case of a rentier state, in which hydrocarbon rents account for about one third of the GDP, more than half of the government budget, and 97 percent of export earnings. As a consequence, the political stability of the regime is closely associated to the fluctuations of oil and gas prices on the global market. It is thereby not surprising that the two most important protest movements over the last decades – the October 1988 uprising and the emergence of the Hirak in February 2019 – coincided with prolonged phases of low hydrocarbon prices that in turn reduced the capacity of the regime to co-opt important constituencies of Algerian society.

Though a linear relationship cannot be assumed, it is likely that high hydrocarbon prices might contribute to stabilize rentier states such as Algeria. In this regard, there are two very positive aspects that the Russian invasion of Ukraine has unleashed for Algerian ruling elites. The first is a rapid rise of gas prices, which reached $4.10 per gallon in March, their highest since July 2008. The war did not create this trend. Throughout 2021, gas prices increased steadily, after having reached a historic low point in June 2020. Yet, the war contributed to strengthen this already ongoing trend, pumping extra rents into the Algerian state’s coffers. Secondly, in their attempt to reduce dependence on Russian gas, Western European countries are trying to rely more on other producers. Thanks to its geographical location, Algeria is at the top of the list. Italy secured a deal for more natural gas imports from Algeria in mid-April. Starting in the fall, this should total to 9 billion cubic meters of gas every year. Considering that gas exports alone (excluding both crude and refined petroleum) represent more than one third of total Algeria’s exports in 2020, clarifies why the rise of the wheat prices should not hit Algeria. Although wheat is the top one of Algeria’ imports, it is valued at less than one fifth of the cost gas and comes almost entirely from Western Europe and North America. Algeria imports less than 0.1 percent of its wheat from Ukraine and almost nothing from Russia. For all these reasons, it seems that Algerian ruling elites might actually benefit from the devastating war in Ukraine.


Different countries, common trends? Morocco and Libya in a comparative perspective

From almost all points of view, Morocco and Libya are two very dissimilar countries that cannot be easily compared. The former is the only monarchy in North Africa, whilst the latter is a republican regime since the successful coup against King Idris led by Muammar Gaddafi in 1969. Morocco is also the only country in the region in which, despite several protest movements, the ruling autocrat, Mohammed VI, has not been defeated by a popular uprising over the last decade. In Libya, on the other hand, Gaddafi’s fall has rapidly led to the outbreak of a long-lasting and cruel civil war, which has involved several regional and international powers and is still not completely resolved. In economic terms as well, the two countries are significantly different. Morocco is a relatively industrialized country, which has exponentially developed its automotive industry over the last years, surpassing South Africa as the leading passenger car manufacturer in Africa. In 2021, for instance, car sales exceeded 160,000 units, creating more than 220,000 jobs. Next to the automotive industry, other key sectors for the Moroccan economy are the production of insulated wire, almost entirely exported to Europe, and the once dominant textile industry.

Libya is instead a very extreme case of a rentier state. Hydrocarbon exports amount to three fourths of the total. Adding gold and other minerals, there is basically nothing else that the country exports. In contrast to Algeria, however, Libya is less likely to benefit from the rise of hydrocarbon prices. There are two main reasons for this. First is the fact that Libya exports primarily crude oil, rather than natural gas. Although the prices of the former have increased significantly over the last two years, it has not grown at the same pace as the latter. Secondly and more importantly, the very unstable political situation in Libya continues to provoke disruptions in the oil supply making it impossible to expand the market. Libya’s total export in crude oil, for instance, remains today about one third below the pre-2011 period. Moreover, Libya imports wheat prevalently from Ukraine (almost half of its total wheat imports) and Russia (about 15 percent), rendering the situation particularly unstable.

The war in Ukraine can instead affect the Moroccan economy in two main ways. First and foremost, the already forecasted slowdown in economic growth at the global level could hit some of the key sectors for Morocco such as the car industry. Secondly, the country is a net importer of refined petroleum and natural gas, which together amount to almost 10 percent of its total imports. This in turn means that the state and private enterprises would pay more for energy. The actual effects of these two factors remain, however, difficult to predict and could be also negligible in the medium-term. To conclude, it is likely that both Libya and Morocco might suffer in a limited way from the war in Ukraine.


Where the storm is strongest: Tunisia and Egypt

Tunisia’s two primary imports are refined petroleum and wheat, the latter coming primarily from Ukraine. Egypt is instead the world’s largest importer of wheat, valued at more than $5 billion in 2020 and almost entirely comes from Russia (62 percent) and Ukraine (24 percent). These very few lines help explain why Tunisia and Egypt are likely to be the two North African countries that the war in Ukraine could affect the most. The reasons why this might happen are, however, dissimilar.

The Covid-19 pandemic disrupted the Tunisian economy at an unprecedented high level. It was by far the country most hit in the region. In 2020, the GDP plummeted by almost 9 percent. The political effects of this economic crisis were extraordinarily significant. After months of almost daily and radical protests, president Kaïs Saïed sacked the country’s prime minister and suspended the parliament in July 2021. This was nothing less than a palace coup with fatal results for the longest democratic experiment in the Arab world. More recently, Saïed’s decision to dissolve the country’s parliament was a new leap in the process towards autocratization. This means that the supposedly strong economic consequences of the Russian war in Ukraine might impact upon a country that is living a phase of huge political uncertainty and is heading towards a constitutional referendum that is likely to polarize Tunisian society even further. In the absence of a strong grass-roots pro-democracy movement, the effects of the economic crisis are likely to strengthen the ongoing autocratization, leading to a gradual process of closure of democratic spaces.

Egypt is a different case. Although scholars have often highlighted how Abdel Fattah al-Sisi’s regime is based more on repression than consent, the former commander-in-chief of the armed forces has ruled the country (directly or indirectly) since July 2013. At the current moment, it is thereby an example of stable authoritarianism. Moreover, the Egyptian economy was not particularly affected by the Covid-19 pandemic. In 2020, the GDP actually grew by almost 4 percent. Despite that, Egypt does not seem isolated from the events in Ukraine. As mentioned above, the country is the world’s largest importer of wheat and Egyptians on average consume about 145 kg of wheat per capita annually – double the global average. Wheat imports have been steadily increasing since the 1970s and at the current price could double what the government spends to import wheat.

It seems, in particular, that there are two main concerns for al-Sisi’s regime. First is the fact that more than four fifths of Egyptian wheat imports come from Russia and Ukraine. This depends on several factors such as competitive prices and geographical proximity to Egyptian ports. As an effect of the war, however, Ukraine has suspended commercial activities in its ports and banned wheat exports. Logically, also Russian wheat movement through the Black Sea has been affected. The Egyptian regime has been therefore forced to look for other wheat exporters to cover its food needs. A shift that, in any case, is neither easy nor cheap. Secondly and more importantly, a critical factor that contributes to explain the stability of al-Sisi’s regime is the relatively generous bread subsidy system, which allocates 150 loaves of subsidized bread per month to recipients. Recently, this has come under attack and the Egyptian government is seeking to reform the system to reduce costs and apply neoliberal diktats coming from international organizations such as the World Bank and International Monetary Fund. This could lay the groundwork for a perfect storm. As the 1977 and 2011 revolutionary uprisings have shown, food – and especially bread – prices are key for the stability of a country in which about one third of the population lives below the poverty line and the demographic trend remains out of control. Over the last months and years, it will become clearer whether North Africa is likely to enter a new revolutionary cycle or not.


Cover Photo: Egypt’s Foreign Minister Sameh Shoukry (L), Arab League Secretary General Ahmed Aboul Gheit (R) and Russian Foreign Minister Sergei Lavrov hold a press conference following talks – Moscow, April 4, 2022 (A. Zemlianichenko / Pool / AFP).

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