However, my personal view on this issue is that the fears over the economic fallout from Egypt’s political crisis on the global economy have been way overblown. Oil markets are functioning normally and the upward pressure on prices from the crisis appears to be easing up already. The rest of the world is simply not exposed to the Egyptian economy in ways that could send severe ripple effects through global financial markets…

The real economic pain from the Egyptian political crisis will be felt primarily by the Egyptians themselves. Tourism is a major source of jobs and revenue, and with foreigners fleeing the turmoil, Egypt can kiss those dollars goodbye for a while. Though the government isn’t facing a serious financial problem, it does post large deficits and could very well find its borrowing costs going up, further straining the budget. Though the country has enjoyed a good few years of growth, the average Egyptian can ill-afford the sort of severe economic shock that the political unrest could very well cause. Unemployment remains high and a hefty chunk of the population still lives under the poverty line.