Egypt: Regional leader on a tightrope

Egypt is the largest country in the Arab world, its pivotal position in the Middle East recognised by strong US financial support. Blighted by poverty, water shortages and political violence, its economy is nevertheless predicted to do well in the near future, thanks to market reforms, modernised infrastructure, and major new oil and gas finds.

Egypt faces daunting challenges, not least from its Islamist movement, but in an unstable region it has managed to achieve a degree of vital stability, and could now be on the threshold of a new era.

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