Economy During the presidency of Gamal Abdel Nasser, the economy of Egypt was radically socialized. Beginning in 1961, foreign trade, banking, insurance, and most wholesale and industrial establishments were nationalized. Those sectors which remained in private hands were placed under heavy regulatory restraints. Industry was expanded and production increased according to a five year plan. Inadequate foreign investment, a sluggish bureaucracy and the disastrous 1967 Arab-Israeli War subverted subsequent programmes until a process of economic reform was inaugurated by Abdel Nasser's successor, Anwar Sadat, in the aftermath of the October War of 1973. By reversing many of Abdel Nasser's policies and opening Egypt to foreign investment, Sadat began a gradual revival of the Egyptian economy which was significantly enhanced by remittances from Egyptian working in the surrounding oil producing countries. The very slow but sure relaxation of import, currency and trade restrictions stimulated Egypt's foreign exchange economy. Tourism, which had fallen off drastically during Abdel Nasser's time due to Egypt's anti-western stance and poor tourist infrastructure, was restarted with the privatization of many nationalized tourist facilities. Sadat's dramatic peace initiative and treaty with Israel transformed the western view of the Arab leader and his country and further enhanced the country internationally, although the gesture was motivated by more practical considerations: Egypt couldn't afford another war with Israel. Despite the many advances the country has witnessed under President Hosni Mubarak, Egypt continues to suffer from the vagaries of regional instability and its exploding population. Government leaders openly admit that population growth is undermining all efforts toward developing the country's economy. This situation is further aggravated by consumerism. Servicing a foreign debt over twice the size of the national budget is another negative factor. Under pressure from the IMF and World Bank, Egypt finally began to lift price controls, reduce subsidies and begin to relax restrictions on trade and investment. Tourism represents one of the most lucrative sectors of Egypt's economy but is highly vulnerable to internal violence and regional politics. The government remains hopeful that the oil and gas discoveries in the western desert will produce significant revenues. Figure 1. Total Population. Graph.
According to the data from World Resource Institute, the total population in Egypt will grow up as can be seen on the figure 1. Although it looks like a linear curve, I got a better result using logistic model. Basically, logistic models represent that the curve will get close to the limit, so the growth of the total population in Egypt will be declining over time. By 2050, it is expected that the total population in Egypt will reach almost 12 million. Figure 2. Urban and Rural Population.
Figure 3. Crude Birth and Death Rate.
The graph of Urban & rural population in Egypt shows urbanization clearly. According to the data, the urban population will be doubled in the next 30 years. This is one of the typical cases of urbanization in the developing countries. Crude birth rate will be still higher than death rate; however, the crude birth rate is expected to be declining over time. On the other hand, the death rate will be growing up again around the year of 2015. Since people are aging, such a trend can be expected in the future. Population Growth Analysis STELLA II About 20 years ago, Dr. Dennis L. Meadows, a professor at MIT, represented the world model in his book, "The Limits To Grows". This model was built specifically to investigate five major trends of global concern; such as accelerating industrialization, rapid population growth, widespread malnutrition, depletion of nonrenewable resources, and a deteriorating environment. Since this model is a formal and mathematical model, it has two important advantages over mental models. First, every assumption is written in a precise form so that it is open to inspection and criticism by all. Second, after the assumptions have been scrutinized, discussed, and revised to agree with the best current knowledge, their implications for the behavior of the world system can be traced without error by a computer, no matter how complicated they become. Referring to the world model and using current available data, I will create the Egypt model by STELLA II. Simple Modeling First of all, I created a simple model, taking into account population factors only, such as birth and death rate. The generation was divided by three, and each growth pattern can be seen in the graph. As a result of this simple model, I could got a similar growth patterns as can be seen on the figure 1. However, the range is a little higher than the data from WRI. Other factors such as Industry, Agriculture and Natural Resource will effect on this growth pattern. Since some of these other factors would play a significant role to decrease the population growth such as birth control, I would like to put GDP (Gross Domestic Products) into the previous model. Figure 4. STELLA II model 1 (population factors only)
Figure 5. Population growth by generation.
Link to GDP Figure 6. Distribution of GDP (percent).
Figure 7. Each category per capita.
GDP is divided three outputs such as industry, service and agriculture. As can be seen, the service sector holds about 60 % of the total GDP. With the increase of service output, service per capita is also growing up in spite of the rapid population growth. Each output will have some relationship with population growth factors such as fertility and mortality. For example, if the industrial per capita increases and people obtain better life, the birth rate would be effected by that. The service per capita also have an influence to this, because people would have better education, which would bring about birth control. Figure 8. Relationship between industry per capita and fertility rate.
Figure 9. Relationship between service per capita and fertility rate.
However, there is no equation to link between them. To what extent the increase industrial per capita effects on total fertility? How about service output? In order to solve this problem, I created graphs in the previous page, showing the relationship between each category of GDP and fertility rate. As can be seen, the fertility rate will be declining over time, while each output changing randomly. That means I cannot have the relationship, because the fertility rate is not determined my them. However, let me think like this. The difference of the fertility rate each year may be effected by the actual results of industry per capita or service one. So I summed it up year by year, and look into the relationship by using Multiple Regression. Multiple Regression Fertility Rate Equation Number 1 Dependent Variable.. FERTIL Block Number 1. Method: Stepwise Criteria PIN .9800 POUT .9900 SUMIND SUMSER SUMAGRI Variable(s) Entered on Step Number 1.. SUMSER Multiple R .99805 R Square .99610 Adjusted R Square .99592 Standard Error .03889 Analysis of Variance DF Sum of Squares Mean Square Regression 1 8.50350 8.50350 Residual 22 .03328 .00151 F = 5621.96550 Signif F = .0000 ------------------ Variables in the Equation ------------------ Variable B SE B Beta T Sig T SUMSER -3.41548E-04 4.5552E-06 -.998049 -74.980 .0000 (Constant) 5.506274 .012850 428.511 .0000 ------------- Variables not in the Equation ------------- Variable Beta In Partial Min Toler T Sig T SUMIND -.126370 -.191485 .008950 -.894 .3814 SUMAGRI -.145369 -.255322 .012025 -1.210 .2397 Variable(s) Entered on Step Number 2.. SUMAGRI Multiple R .99818 R Square .99636 Adjusted R Square .99601 Standard Error .03849 Analysis of Variance DF Sum of Squares Mean Square Regression 2 8.50567 4.25283 Residual 21 .03111 .00148 F = 2871.05761 Signif F = .0000 ------------------ Variables in the Equation ------------------ Variable B SE B Beta T Sig T SUMSER -2.92100E-04 4.1109E-05 -.853557 -7.106 .0000 SUMAGRI -1.18900E-04 9.8253E-05 -.145369 -1.210 .2397 (Constant) 5.527124 .021414 258.108 .0000 ------------- Variables not in the Equation ------------- Variable Beta In Partial Min Toler T Sig T SUMIND .023096 .021745 .003230 .097 .9235 Variable(s) Entered on Step Number 3.. SUMIND Multiple R .99818 R Square .99636 Adjusted R Square .99581 Standard Error .03943 Analysis of Variance DF Sum of Squares Mean Square Regression 3 8.50568 2.83523 Residual 20 .03109 .00155 F = 1823.75924 Signif F = .0000 ------------------ Variables in the Equation ------------------ Variable B SE B Beta T Sig T SUMIND 1.32982E-05 1.3671E-04 .023096 .097 .9235 SUMSER -2.94550E-04 4.9072E-05 -.860716 -6.002 .0000 SUMAGRI -1.31929E-04 1.6755E-04 -.161299 -.787 .4403 (Constant) 5.528470 .025937 213.147 .0000 End Block Number 1 POUT = .990 Limits reached. In this multiple regression, independent variables; such SUMSER as sum of service per capita, were entered on step number, meaning that the most relative independent variable to the dependent variable of "fertility rate" was selected to be in the equation at first. As can be seen in the R square, the fertility rate is totally effected by service per capita (R Square = .99610). The other two variables could not give significant change in the R Square (R Square = .99636). This seems to mean that there is little link between the fertility rate and the industrial or food per capita. It is sure that this discovery will decisively effect on the model, and I can put an equation into it based on the result of the multiple regression as follows; "Fertility rate" = .000013982 * SUM(industrial_per_capita) + (-.00029455) * SUM(service_per_ capita) + (-.000131929) * SUM(food_per_capita) Mortality Rate Equation Number 1 Dependent Variable.. MORTAL Block Number 1. Method: Stepwise Criteria PIN .9800 POUT .9900 SUMIND SUMSER SUMAGRI Variable(s) Entered on Step Number 1.. SUMAGRI Multiple R .99574 R Square .99150 Adjusted R Square .99111 Standard Error .28094 Analysis of Variance DF Sum of Squares Mean Square Regression 1 202.48991 202.48991 Residual 22 1.73634 .07892 F = 2565.61570 Signif F = .0000 ------------------ Variables in the Equation ------------------ Variable B SE B Beta T Sig T SUMAGRI -.003984 7.8645E-05 -.995740 -50.652 .0000 (Constant) 17.985729 .103648 173.527 .0000 ------------- Variables not in the Equation ------------- Variable Beta In Partial Min Toler T Sig T SUMIND .993537 .713548 .004385 4.667 .0001 SUMSER .406696 .483664 .012025 2.532 .0194 Variable(s) Entered on Step Number 2.. SUMIND Multiple R .99791 R Square .99583 Adjusted R Square .99543 Standard Error .20146 Analysis of Variance DF Sum of Squares Mean Square Regression 2 203.37397 101.68698 Residual 21 .85228 .04058 F = 2505.54368 Signif F = .0000 ------------------ Variables in the Equation ------------------ Variable B SE B Beta T Sig T SUMIND .002798 5.9949E-04 .993537 4.667 .0001 SUMAGRI -.007949 8.5162E-04 -1.987096 -9.335 .0000 (Constant) 18.469929 .127621 144.724 .0000 ------------- Variables not in the Equation ------------- Variable Beta In Partial Min Toler T Sig T SUMSER .134039 .195267 .003230 .890 .3838 Variable(s) Entered on Step Number 3.. SUMSER Multiple R .99799 R Square .99599 Adjusted R Square .99538 Standard Error .20246 Analysis of Variance DF Sum of Squares Mean Square Regression 3 203.40647 67.80216 Residual 20 .81978 .04099 F = 1654.14658 Signif F = .0000 ------------------ Variables in the Equation ------------------ Variable B SE B Beta T Sig T SUMIND .002477 7.0200E-04 .879610 3.529 .0021 SUMSER 2.24357E-04 2.5197E-04 .134039 .890 .3838 SUMAGRI -.008028 8.6035E-04 -2.006650 -9.331 .0000 (Constant) 18.501888 .133183 138.920 .0000 End Block Number 1 POUT = .990 Limits reached. In comparison with the fertility rate, the most relative independent variable of SUMAGRI (food per capita) to the dependent variable of "mortality rate" was selected to be in the equation at first. As can be seen in the R square, the mortality rate is totally effected by food per capita (R Square = .99150). The other two variables could not give significant change in the R Square (R Square = .99599), either. This seems to mean that there is little link between the mortality rate and the industrial or service per capita. I can also put an equation into it based on the result of the multiple regression as follows; "Mortality Rate" = .002477 * SUM(industrial_per_capita) + .000224357 * SUM(service_per_capita) + (-.008028) * SUM(food_per_capita) Curvefit Analysis Since the multiple regression is used a liner model, there might be another estimation such as logistic model in representing the relationship. I found strong relationships between the fertility rate and the service per capita, and the mortality rate and the food per capita as I noted earlier. In these two cases, I compared the linear model with the logistic one below. The results tells us that each of the linear models has a slightly better R-Square than that of the logistic model. It means that I had better use a linear model in the multiple regression rather than a logistic one. Curvefit fertility with service per capita CURVEFIT /VARIABLES=fertil WITH sumser -> /CONSTANT -> /MODEL=LINEAR LGSTIC -> /PLOT FIT. Independent: SUMSER Dependent Mth Rsq d.f. F Sigf bound b0 b1 FERTIL LIN .996 22 5621.97 .000 5.5063 -.0003 FERTIL LGS .995 22 4021.98 .000 . .1798 1.0001 Figure 10. Curvefit fertility with service per capita
CURVEFIT /VARIABLES=mortal WITH sumagri -> /CONSTANT -> /MODEL=LINEAR LGSTIC -> /PLOT FIT. Independent: SUMAGRI Dependent Mth Rsq d.f. F Sigf bound b0 b1 MORTAL LIN .991 22 2565.62 .000 17.9857 -.0040 MORTAL LGS .989 22 1954.93 .000 . .0537 1.0003 Figure 11. Curvefit mortality with food per capita.
Gross_Domestic_Products(t) = Gross_Domestic_Products(t - dt) + (capital_investment - capital_depreciation) * dt Initial Gross_Domestic_Products = 40000000000 INFLOWS: capital_investment = (agricultural_output*.3+industrial_output*.7+service_output*.5)*(investment_rate/ 100)+official_development_assistance OUTFLOWS: capital_depreciation = Gross_Domestic_Products/average_lifetime_of_capital/100 population_1__#0_to_14#(t) = population_1__#0_to_14#(t - dt) + (births - deaths_0_to_14 - maturation_1_to_2) * dt Initial population_1__#0_to_14# = 23924000 INFLOWS: births = population_2__#15_to_64# * 0.48 * fertility_rate - total_population * infant_mortality OUTFLOWS: deaths_0_to_14 = population_1__#0_to_14#*mortality maturation_1_to_2 = population_1__#0_to_14#*(1-mortality) Modeling linked with GDP Figure 12. STELLA II model linked with GDP.
population_2__#15_to_64#(t) = population_2__#15_to_64#(t - dt) + (maturation_1_to_2 - maturation_2_to_3 - deaths_15_to_64) * dt Initial population_2__#15_to_64# = 36361000 INFLOWS: maturation_1_to_2 = population_1__#0_to_14#*(1-mortality) OUTFLOWS: maturation_2_to_3 = population_2__#15_to_64#*(1-mortality) deaths_15_to_64 = population_2__#15_to_64#*mortality population_3__#65_and_over#(t) = population_3__#65_and_over#(t - dt) + (maturation_2_to_3 - deaths_65_and_over) * dt Initial population_3__#65_and_over# = 2646000 INFLOWS: maturation_2_to_3 = population_2__#15_to_64#*(1-mortality) OUTFLOWS: deaths_65_and_over = population_3__#65_and_over#*mortality/mortality agricultural_output = Gross_Domestic_Products * agricultural_capital _output _ratio /100 birth_control = (.000013982*SUM(industrial_per_capita) -.00029455 * SUM(service_per_capita) - .000131929 * SUM(food_per_capita)) * 5 fertility_rate = perspective_birth_rate+birth_control food_per_capita = agricultural_output/total_population health_service = (.002477*SUM(industrial_per_capita) + .000224357 * SUM(service_per_capita) - .008028 * SUM(food_per_capita)) * 5 industrial_output = Gross_Domestic_Products*industrial_capital_output_ratio/100 industrial_per_capita = industrial_output/total_population mortality = (perspective_death_rate+health_service)/1000 service_output = Gross_Domestic_Products*service_capital_output_ratio/100 service_per_capita = service_output/total_population total_death = deaths_0_to_14+deaths_15_to_64+deaths_65_and_over total_population = population_1__#0_to_14# + population_2__#15_to_64# + population_3__#65_and_over# agricultural_capital_output_ratio = GRAPH(TIME) (0.00, 17.0), (1.00, 16.5), (2.00, 16.0), (3.00, 15.0), (4.00, 12.0), (5.00, 11.0), (6.00, 9.50), (7.00, 8.50), (8.00, 8.50), (9.00, 6.50), (10.0, 7.50), (11.0, 9.50), (12.0, 10.0) average_lifetime_of_capital = GRAPH(TIME*5) (0.00, 30.0), (1.00, 28.5), (2.00, 28.0), (3.00, 27.5), (4.00, 26.5), (5.00, 26.5), (6.00, 25.0), (7.00, 24.5), (8.00, 22.5), (9.00, 22.5), (10.0, 22.0), (11.0, 21.0), (12.0, 20.0) industrial_capital_output_ratio = GRAPH(TIME) (0.00, 28.0), (1.00, 27.0), (2.00, 26.0), (3.00, 25.5), (4.00, 26.0), (5.00, 26.0), (6.00, 27.5), (7.00, 30.5), (8.00, 33.5), (9.00, 36.5), (10.0, 38.0), (11.0, 39.0), (12.0, 40.0) infant_mortality = GRAPH(TIME) (0.00, 0.054), (1.00, 0.043), (2.00, 0.035), (3.00, 0.03), (4.00, 0.025), (5.00, 0.02), (6.00, 0.017), (7.00, 0.014), (8.00, 0.012), (9.00, 0.009), (10.0, 0.008), (11.0, 0.008), (12.0, 0.007) investment_rate = GRAPH(TIME*5) (0.00, 1.00), (1.00, 1.85), (2.00, 2.35), (3.00, 2.75), (4.00, 3.05), (5.00, 3.45), (6.00, 3.70), (7.00, 3.95), (8.00, 4.35), (9.00, 4.60), (10.0, 4.75), (11.0, 4.75), (12.0, 5.00) official_development_assistance = GRAPH(TIME*1000000) (0.00, 2000), (1.00, 1950), (2.00, 1785), (3.00, 1695), (4.00, 1635), (5.00, 1500), (6.00, 1365), (7.00, 1305), (8.00, 1185), (9.00, 1125), (10.0, 1065), (11.0, 1035), (12.0, 1000) perspective_birth_rate = GRAPH(TIME) (0.00, 3.00), (1.00, 2.95), (2.00, 2.90), (3.00, 2.85), (4.00, 2.85), (5.00, 2.80), (6.00, 2.75), (7.00, 2.70), (8.00, 2.65), (9.00, 2.65), (10.0, 2.55), (11.0, 2.50), (12.0, 2.45) perspective_death_rate = GRAPH(TIME) (0.00, 8.00), (1.00, 7.20), (2.00, 6.80), (3.00, 6.65), (4.00, 6.20), (5.00, 6.10), (6.00, 6.00), (7.00, 6.15), (8.00, 6.45), (9.00, 6.65), (10.0, 7.20), (11.0, 7.50), (12.0, 8.00) service_capital_output_ratio = GRAPH(TIME) (0.00, 55.0), (1.00, 56.5), (2.00, 58.0), (3.00, 59.5), (4.00, 62.0), (5.00, 63.0), (6.00, 63.0), (7.00, 61.0), (8.00, 58.0), (9.00, 57.0), (10.0, 54.5), (11.0, 51.5), (12.0, 50.0) Assumption Each initial number; such as GDP and population is based on the data in 1995 from WRI. In capital investment, an inflow of GDP, it is on the assumption that each distribution of current GDP would effect on that of the next year by the following ratio; such as agriculture 30%, service 50% and industry 70%. Deaths of each generation is based on mortality, and the rest of them mature to the next generation. Birth control and health service, which effect on fertility and mortality rate, is the results from the multiple regression analysis. Some factors have (*5) at the end of equation, because 1 time on graphs equals 5 years. Each distribution of GDP capital output ratio makes up to 100%, and it is on the assumption of the prospective trend the government might think much of the industrial output in comparison with the service one over time. Average life time of capital would be improved 50% in the model. Other factors are overall based on the data of WRI, and added some reasonable assumptions. Results (Graphs) From the next page, some graphs are shown; such as Total Population, Fertility, Mortality and the distribution of GDP, which were brought about by running the STELLA II model. In comparison with the previous model, the total population became closer to the perspective of WRI, which means that the distribution of GDP would surely effect on the population growth, and the linear equations by the multiple regression analysis brought about a better connection between the distribution of GDP and the fertility or mortality rate in the model. Figure 13. Total Population.
Figure 14. Distribution of GDP.
The total population would increase over time, which looks like a logistic growth. It would reached about 13 million in 60 years. Since WRI expects about 12 million in 2050, this result is very close to it. On the other hand, GDP would gradually grow up, and the distribution clearly reflects the assumptions which I gave. Each of these output effects on the fertility and mortality rate on the basis of the equations, resulted by the multiple regression. Table 2. Input Data of Each Sum of Distribution of GDP per capita and Population Growth Factors.
The fertility rate would gradually be decreasing and reach around 2.10 children per women. According to the equation from the multiple regression, the sum of service per capita would strongly effect on it. Since service per capita would be still high for a while, the fertility rate would be surely influenced, and would be the same rate that WRI estimated. On the other hand, the mortality rate would be increasing in about 30 years. The sum of food per capita would have a significant role for the mortality rate in the equation of multiple regression results. Because of the low share of the agricultural output, the mortality rate might not depend upon the linear equation. Conclusion In this research, I found very strong relationships between the sum of service per capita and the fertility rate, and the sum of food per capita and the mortality rate by multiple regression analysis. Each R Square is over .99, which means the dependent variable changes as the almost same as the independent variable does. By using these results, the new STELLA II model would reflect the population dynamics more realistically in comparison with the previous simple model. However, it is sure that a lot of factors; such as pollution, nonrenewable resources and agriculture, should be included into this model in order to make it more realistic. Furthermore, most of other students created maps and graphs among countries in the world. It is sure that such maps and graphs make us easily understood to what extent of the category in the country is situated in the world. I could include other neighbor countries into the STELLA model, too. Actually, such a relationship is surely important for the population dynamics, though the data might be difficult to obtain. I hope this research would provide further studies regarding the population dynamics and that this STELLA model would be endlessly improved by adding more factors. References Donella H. Meadows, Dennis L. Meadows, Jorgen Randers, William W, Behrens, The Limits To Growth, 1972 Donella H. Meadows, Dennis L. Meadows, Jorgen Randers, William W, Behrens, Beyond The Limits, 1992 William D. Drake, Towards Building a Theory of Population-Environment Dynamics, 1992 World Resources Database, World Resource Institute, 1996 World Resources, A Guide to the Global Environment 1996-97, New York: Oxford University Press, 1996 The Institute of National Planning, UNDP Egypt, Human Development Report 1995, 1995 UN ECOSOC Special Session 1993, Programme Planning and Implementation Fifth Country Programme for Egypt, 1993 High Performance Systems, STELLA II Applications, 1994 High Performance Systems, STELLA II An Introduction to Systems Thinking, 1994 Guy Aubert, Le Courrier Du Cnrs Cities: Habitat II Istanbul, 1996 Claude Abraham, Urbanism May - June 1996, 1996 The World Bank, Sustainable Transport: Priorities for Policy Reform, 1996 United Nations, Habitat II Agenda: Istanbul Declaration, 1996 United Nations DESIPA, Urban and Rural Areas 1994, 1995 UNDP, Choices: Cities on the Edge, 1996 United Nations Conference on Human Settlement (Habitat II), The Future of Human Settlements: Good Policy Can Make A Difference, 1996 Ellen Kitonga, UNCHS (Habitat II), Countdown to Istanbul, 1996 Bob Catterall, CITY: Featuring Habitat II, The Right to a Sustainable City, 1996