Egyptian newspapers are in deep water after a major state-run printing service announced its decision to increase printing prices following the November decision to float the pound. This takes place amid an ongoing decline in newspaper distribution, and observers expect that some newspapers will collapse entirely following the decision.
In late November, the state-run Al-Ahram printing service sent a letter to all its contracting Egyptian newspapers to announce it would raise printing costs by 80% starting Dec. 15, due to the increasing value of the US dollar against the Egyptian pound.
Editors of private and public newspapers, as well as media experts, said the decision is catastrophic and may lead to the closure of several newspapers in the coming months.
“The decision is putting the print journalism industry in Egypt in a real crisis,” said Walaa El-Sheikh, editor-in-chief of the privately owned newspaper Al-Dostor. Sheikh told Al-Monitor that the cost of a newspaper may increase by 2 to 4 Egyptian pounds (10 to 20 cents), which ordinary citizens can't afford. “Egyptians cannot bear more burdens,” he said. The cost of most newspapers in Egypt ranges between 1.4 to 2 Egyptian pounds (8 to 10 cents), while about a quarter of Egyptians live on less than $1 per day, according to the World Bank.
Last month, the Central Bank of Egypt floated the pound, devaluing it by 32.3% in a move to rebalance currency markets after weeks of turbulence. The pound flotation came as part of an economic reform program undertaken by the government to stimulate economic growth and draw in additional foreign investments.
Following the flotation, Egypt’s consumer prices rose by 19.4% year-on-year in November, accelerating from a 13.6% growth in October. It was the highest inflation rate since November 2008 and the first reading since the central bank floated the currency and hiked fuel prices.
Sheikh said that Egyptian newspapers are already incurring massive losses due to unsteady economic conditions following the January 25 Revolution. “Since the revolution, Egyptian newspapers have been suffering from major losses because of declining advertisement and distribution rates,” he said.
According to a recent study conducted by the state-owned Central Agency for Public Mobilization and Statistics, print newspaper distribution declined by 14.4% in 2015 compared with the previous year. A 2013 report released by the Arab Media Forum showed that advertising spending in Egypt decreased by 30% in 2011 as a result of political unrest.
“Advertising is strongly related to business activity, and now in Egypt industrial and economic activity is at its lowest,” Sheikh said. Business activity in Egypt shrank for the 13th consecutive month in October, with output falling at its sharpest pace since 2013, according to the Emirates NBD Egypt Purchasing Managers’ Index.
Sheikh suggested that the government remove the customs duties imposed on printing materials used by Al-Ahram printing service. Currently, the government imposes high customs duties on printing materials, most of which are imported and must be purchased with dollars. “Lifting customs duties on materials used in printing would be the most suitable option to solve this crisis,” Sheikh said.
Sheikh urged the government to intervene and support public and private newspapers financially and technically due to the pressures they face from deteriorating economic conditions and emerging digital media.
In Egypt, like the rest of the world, online media and social networking sites have experienced exponential growth, particularly after the January 25 Revolution.
The Egyptian Ministry of Communications and Information Technology showed in 2015 that Egypt has the highest number of internet users in the Arab world, as more than half the population (48 million people) has access to the internet.
Mahmoud Allam El-Deen, a professor of mass communications at Cairo University, said that following the recent decision to raise printing costs, newspapers will have two options: decrease circulation or raise prices. “Both options will still harm the future of print journalism in Egypt,” Allam El-Deen told Al-Monitor.
Allam El-Deen expects that only 20% of Egypt’s newspapers will survive as print media in the coming years, while 40% will become online portals. The remaining 40% will shut down. “Newspapers still have readership, especially from the elderly, and I think that it will be very difficult for them to disappear and be replaced by digital media,” he said.
Egypt had 19 daily newspapers in 2009, up from 14 newspapers in 2003, according to Arab Media Outlook. In April 2013, the Egypt State Information Service website listed 35 daily newspapers. There are many more weekly and monthly newspapers. According to the Arab Media Outlook 2009-2013 report, news consumption is moving online, with just 41% of newspaper readers getting their news only from newspapers. About 40% of newspaper readers also get their news via the internet, with 17% getting their news from blogs, 12% from email, 9% from e-bulletin boards and 7% from cellphone alerts.
Allam El-Deen said Egypt’s newspapers have to find new, innovative ways to attract readers by vocalizing Egyptians' day-to-day problems and maintaining high levels of transparency and credibility that will prompt people to buy newspapers.
“Newspapers, especially public ones, have to improve their performance, present what attracts readers and restructure their management,” he said.
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