Historical Outline of Foreign Presence in Modern Egypt

The reign of Mehmet Ali marked a notable increase in the number of foreigners in Egypt, a trait that would characterize Egypt’s entire modern history. Mehmet Ali (or Muḥammad

‘Alī in Arabic) was an Ottoman Albanian commander who was entitled Paşa and in 1805 was appointed by the Ottoman sultan Wālī [governor] of the Egyptian province. In 1841, the sultan Abdülmecid I granted him Egypt as a hereditary domain. During his long reign, which ended in 1848 when he was deposed due to mental illness (Fahmy 1998: 139), Mehmet Ali Paşa managed to increase Egypt’s independence, put an end to the Mamluks’

power, and start a process of modernization of the country. For this reason, he is considered the Founder of Modern Egypt (Dodwell 1931). As the historian Khaled Fahmy (1998:139) points out:

Moved by a desire to turn his tenure as governor into a more secure and permanent position, Muhammad ‘Ali undertook various radical measures that changed Egypt’s position within the Ottoman empire, strengthened its economic ties with Europe at the expense of older links with other provinces of the empire, and radically changed its social and cultural map.

Most significantly, by creating a massive naval and military force, the Pasha was able to expand Cairo’s control not only over the entire province of Egypt, but also much beyond the traditional borders of the province to

pans of Anatolia, the heartland of the Ottoman empire. In short, Muhammad ‘Ali had succeeded in reaping the considerable potential wealth of Egypt, in organizing its internal administration, and then in using this accumulated wealth and better organization to transform Cairo and its environs from a mere provincial capital within the Ottoman empire into the center of an expansive ‘empire’ ruled by the Pasha and his elite.

During Mehmet Ali’s reign, the number of foreigners in Egypt increased rapidly, thanks to his modernization policy and the favorable conditions he created to attract them (Kitroeff 1983: 8). He invited “foreign agricultural experts, factory managers and skilled workers” (Karanasou 1999: 25) to Egypt. However, he needed Europeans not only for their expertise but also for “their contact with Europe for the import-export trade” (Deeb 1978: 12). At the same time, he sent many Egyptians to study in Europe (Fahmy 1998:

168).

According to the census of 1846, the Egyptian population had reached 4,476,440. This number was dismissed by European observers, who provided estimates ranging from 1.5 million to 2.5 million (McCarthy 1976: 18). McCarthy (1976: 18) argues, however, that while the data from the census of 1846 cannot be as accurate as a modern census, they still “fit very well” times and events and are more accurate than other estimates.

Foreigners made up around 38,000 of the population, with 12,000 Ottomans, 5,000 Greeks, and 2,000 Italians. There was an increase not only in the number of foreigners at the time but also in the number of European commercial enterprises. Of these enterprises, Alexandria counted 21 in 1822, which had increased to 69 in 1837 (Deeb 1978: 12).

Under Mehmet Ali’s successor ‘Abbās Paşa (r. 1848–54), the number of foreigners decreased slightly, increasing again under Sa‘īd Paşa (r. 1854–63) in virtue of the favorable commercial conditions he offered to Europeans. In fact, Sa‘īd Paşa “removed all restrictions on direct contact between merchants and cultivator, abolished internal dues, and refrained from reverting to the old monopoly, and thus opened the interior of Egypt to merchants and petty traders whether indigenous or foreign” (Deeb 1978: 14).

Consequently, towards the end of the 1870s, “the foreign domination of commerce in Egypt was complete, leaving for the Egyptians some petty trade and some traditional sections of commerce” (Deeb 1978: 15). As Karanasou (1999: 28–9) states:

In the period until the First World War, Egypt witnessed an enormous influx of foreigners and alongside the Greek community other foreign communities developed. Some, like the Jews, Syrians and the Armenians,

were pre-nineteenth-century millets⁹ that expanded, while others, like the Italians, the Maltese, the French and the British, had begun to appear in the days of Mohammed Ali. In 1872 there were already 80 000 foreign subjects resident in Egypt and an unspecified but large number of immigrants from other parts of the Ottoman empire. The cities and small towns began to develop new, European quarters where foreigners and non-Muslims minorities settled in a life apart from the native population.

In 1882 Egyptian authorities attempted to collect the data for a new census, whose supervision was entrusted to the French Boinet Bey of the Institut Egyptien. For various reasons, the data were not completely accurate:

While more than 40 years had passed since Muhammad Ali’s conscription, not so long a period had passed since the corvée for the Suez Canal.

Peasants still probably found it difficult to distinguish between the census taker and the tax collector. The tradition of never telling the truth to the government still applied. In such circumstances, it was remarkable that the 1882 came as close as it did to accuracy (McCarthy 1977: 24).

Even considering the low estimate, the data still shows a definite population increase from Mehmet Ali’s time and, analogically, the number of foreigners residing in the country. According to the census of 1882 (Niẓārat al-Dāḫiliyya 1885: 22-3), 6,806,381 was the number of inhabitants of Egypt at the time.¹⁰ Of them, 90,886 were foreigners, including 37,301 Greeks and 18,665 Italians. Besides, 31,774 subject of Ottoman origin were not considered foreigners, but fell under the category ‘Egyptians’.

The constant increase in the number of foreigners, especially Greeks and Italians, can be justified by several factors: first of all, the entrance of Egypt into the global economy, and in particular the cotton boom of 1861-1866, which was boosted by the cotton crisis caused by the American civil war, attracted foreign capital (Deeb 1978: 15). Between 1882 and 1918 “foreign domination of finance, banking, trade, and various joint-stock companies was almost complete. Among the 35 main cotton exporters there was only one prominent Egyptian firm” (Deeb 1978: 16). The boom years of the early 1890s only made Egypt more attractive: “the British, French and Belgians in particular began to invest in

9 The term means religion, religious community, and nation. Here it refers to the meaning attributed to it in the Ottoman empire. In the so-called millet system, religious minorities were given “limited power to regulate their own affairs, under the overall supremacy of the Ottoman administration” (see Aviv 2016).

10 McCarthy (1976: 24, 38–9 fn) has pointed out that the total number was slightly greater, at 6,817,262 because some areas were not included in the original report.

the various companies that were established then: land and urban land companies, public works, contracting, transport, industrial and commercial capitals” (Deeb 1978: 16).

Table 1

Development of the number of the three communities in Egyptian censuses Turks Greeks Italians tot. foreigners tot. inhabitants 1882 31,774 37,301 18,665 90,886 * 6,806,381

* Turks are not considered foreigners and they are included in the number of Egyptian subjects.

** The number of foreigners includes only subjects of foreign governments. The subjects of the local government are counted with the Egyptian subjects

Sources: 1882 census (Niẓārat al-Dāḫiliyya 1885: 22–3); 1897 census (Niẓārat al-Māliyya 1898: 62–3);

1907 census (Niẓārat al-Māliyya 1909: 176–7); 1917 census (Wizārat al-Māliyya: 1921: 512–7); 1927 census (Wizārat al-Māliyya: 1931: 206–21); 1937 census (Wizārat al-Māliyya: 1942: 228–35); and 1947 census (Wizārat al-Māliyya wa-l-Iqtiṣād 1953: 34)

Moreover, thanks to the Capitulations, Europeans had a number of privileges and concessions that made Egypt tempting: they were not subject to local Courts but to consular Courts, they enjoyed advantages in their transactions, and they were exempted from paying taxes and duties (Karanasou 1999: 29; Deeb 1978: 17).

The economic control of foreigners in Egypt became even more evident after 1876, when Egypt was declared bankrupt due to the debts it had contracted to undertake several

11 8,471 were Ottoman subjects and 17,903 were subjects of the local government.

12 This number includes: 56,731 declared as Greeks, 17,622 as subjects of the local government, 4,258 as Ottoman subjects, 2,422 as British subjects, and 1,625 as Italian subjects.

13 2,948 were Ottoman subjects and 10,585 were subjects of the local government.

14 This number includes: 76,264 declared as Greeks; 10,849 as subjects of the local government; 6,405 as British subjects; 4,942 as Italian subjects; 1,333 as Ottoman subjects; and 251 as French subjects.

15 2,058 were Ottoman subjects and 8,652 were subjects of the local government.

16 This number includes: 68,559 declared as Greeks; 8,024 as subjects of the local government; 4,189 as British subjects; 2,113 as Italian subjects; 275 as Ottoman subjects; and 143 as French subjects.

17 3,700 were Ottoman subjects and 5,139 were subjects of the local government.

18 This number includes: 57,427 declared as Greeks; 9,955 as subjects of the local government; 1,847 as Italian subjects; 1,523 as British subjects; and 115 as Ottoman subjects.

ambitious infrastructural projects. European creditors began to supervise its finances, heralding the complete European economic—and later political—control. Even though Egypt was part of the Ottoman Empire until 1914, when it was declared a British protectorate, the British appointed a number of ministerial advisers who were actually in charge of all decision making (Karanasou 1999: 33). In fact, the country's real ruler until 1922 was the British Consul General, who was also responsible for protecting foreign minorities.

This obviously increased the possibilities that foreigners, in particular Europeans, had of controlling the economy of the country. Their presence

was significant not so only in numerical terms, but most of all because of its economic power. Foreign wealth was concentrated in the modern and fastest-growing sectors of the economy: trade, finance, public utilities and industry. With native Egyptian wealth concentrated almost exclusively in land-ownership, it was foreign capital from abroad and from the foreign resident community that dominated private investment. In addition, foreign investment was greatly encouraged by generous government concessions, especially in public utilities (Karanasou 1999: 34).

They invested particularly in trade, especially cotton, but soon they also began to invest in land ownership (in 1907 foreigners owned 14% of privately-owned land). In addition, they controlled nearly the entire public debt (Karanasou 1999: 34).

As Deeb (1978:11) pointed out, “these local foreign minorities constituted a cultural island or islands in Egypt with their schools, newspapers, clubs.” They mostly lived in urban centers: Alexandria, Cairo, Port Sa‘īd, Ismā‘īliyya, Suez. Nevertheless, some of them, mostly Greeks, Jews, and Syrians, also ventured to rural villages throughout the country (Deeb 1978:18). In this period, foreigners constituted about a quarter of the inhabitants of both Alexandria and Port Said and one sixth of Cairenes (Karanasou 1999:

34). Not all of them played leading economic roles. However,

those who did tended to have a great deal in common, for they brought with them or developed while in Egypt talents essential to the continued growth of the Egyptian economy. In the first place they had Western education. They were fluent in Western languages […]. They brought their mercantile experience and their ties with European firms. Language, education, commercial know-how, and in some cases, capital set them off from others and enabled them to be at the forefront of the incorporation of Egypt into the capitalist world economy of the nineteenth century (Tignor 1980: 421).

Although “persons of different ethnic and religious backgrounds were to be found in virtually every Egyptian economic activity, the communities were strongly represented in certain undertakings” (Tignor 1980: 423). For example, the Greeks were mostly merchants, moneylenders, and cotton exporters, Syrians were active in small retail and wholesale trading, while most Italians were craftsmen. Armenians ran the tobacco and cigarette industries, British were important in shipping, banking, and cotton trading (Tignor 1980: 423). Belgians, who constituted a small but powerful minority, were professionals, in particular judges, lawyers, or associated with Belgian joint stock companies (Tignor 1980: 427).

Jews were also particularly prominent, especially in the financial sector. They were on the boards of many Egyptian joint stock companies. The case of the Jews is different from other foreign communities since they were less clearly delineated as foreigners.

Most of them were Sephardic, even though there was a Karaite community and some Ashkenazi Jews who migrated to Egypt during the twentieth century (Tignor 1980: 424).

They had no shared national homeland, a characteristic that remained even after the birth of Zionism, as many Egyptian Jews evinced little interest in the Jewish homeland (Tignor 1980: 427). They were in fact nationals of various countries, including Egyptians (e.g.

the Qaṭṭāwīs and the Cicurels), Hungarians (e.g. the Greens), British (e.g. the Hararis and the Rolos), Italians (e.g. the Suareses and the Mosseris), and French (Tignor 1980: 424).

With the rise of the nationalist movement and formal independence in 1922, foreigners began to lose the security and the wealth guaranteed by British control. A local industrial and commercial bourgeoisie began to rise: “by the end of the Second World War, Egyptians owned a substantial share in total capital invested in enterprises”

(Karanasou 1999: 40). In 1927 a ministerial decree stated that the board of directors of any company should include at least two members of Egyptian nationality (Deeb 1978:

19). This clearly had an impact on shared stock companies. For example, observing the composition of the board of such companies in 1923 and in 1946, i.e. before and after the promulgation of the decree, Tignor (1980: 434) noticed that a major transformation occurred: while in 1923 most of the companies were dominated by a European board and

only four firms had influential local directors,¹⁹ in 1946 at least 60 joint stock companies were dominated by Egyptians.

This would lead, according to Tignor, to the rise of a new social class, a mixed haute bourgeoisie that included foreigners and Egyptians and shared some characteristics. The first one was the language: haute bourgeoisie members, whether Egyptians or foreigners, spoke French or, to a lesser degree, English. They gradually lost their Arabic skills: this happened not only to Europeans but even to Syrians, which could be explained by the fact that they all received a Western education (Tignor 1980: 442). It becomes clear here that language intersects with class: indeed, while foreigners and Egyptians of the rising haute bourgeoisie expressed themselves in French or English irrespective of their origin, foreigners coming from lower classes would have a higher competence in Arabic and in their own native language. Only the Greeks continued to seek close identification with Greek culture, and required their children to speak, read, and write Greek (Tignor 1980:

442).

Moreover, members of the haute bourgeoisie tended to live in special quarters, separated from the rest of the population. Traditionally, and until World War I, quarters were mostly organized on an ethnic basis. Afterwards, they were based more “on the basis of socio-economic status. In the rich areas children of haute bourgeoisie families from diverse nationalities mixed freely” (Tignor 1980: 444). They often followed the same life routine and activities. Likewise, their literary and artistic tastes were similar, and mostly referred to French culture (Tignor 1980: 444).

Things became even more complicated for foreigners after the Montreux Conference in 1937: capitulations were abolished, and foreigners became subject to local law and mixed courts (completely abolished later in 1949). Moreover, with the growth of unemployment rates among Egyptian graduates, companies began to feel the pressure to hire more Egyptians. After World War II, such pressure increased more and more.

Although the second quarter of the twentieth century censuses show a high number of foreigners living in Egypt (vide supra), the number was certainly declining. In fact, there was “an increase in the number of local foreigners who acquired Egyptian citizenship.

19 The Mortgage Company of Egypt, the Port Said Salt Association, the Agricultural Bank of Egypt, and the Société Générale de Pressage et de Dépots (Tignor 1980: 432).

The increasing Egyptianization of local foreigners was one of the ways by which they adapted to the new political realities of Egypt” (Deeb 1978: 22).

The situation began to deteriorate more rapidly starting in 1952: the outbreak of riots on 26 January 1952, where many foreigners were killed, and the expulsion of British and French subjects in 1956 after the Suez crisis, were felt by all foreigners living in Egypt, despite Nāṣir’s verbal assurances. The ensuing nationalization of foreign and Egyptian business in 1961 and 1962 was the coup de grâce: between 1961 and 1967 there was an

‘exodus’ of foreigners:

Their emigration, although not officially endorsed by the Egyptian authorities, was less a matter of choice than of necessity. Many people say that they left only because everybody was leaving or that or even if their own jobs were secure, there was no future for their children in the country anymore. Others speak of incidents of intimidation by Egyptians.

Whatever the reason, the fact is that there was no place for foreigner in Nasser’s social revolution, and without foreign employers to give them employment the foreign communities had lost the means of maintaining their presence in Egypt (Karanasou 1999: 43).

What Karanasou says here about Greeks applies to other foreigners as well. The costs of remaining in Egypt continued to increase and the foreign communities who had lived in Egypt for at least one and a half centuries decided it was time to leave.