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Arab World

Fallout from Iran War Casts Shadow over Egypt’s New Budget

Egypt’s House of Representatives being briefed on the government’s outlook on the state budget (House of Representatives)
Egypt’s House of Representatives being briefed on the government’s outlook on the state budget (House of Representatives)
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Fallout from Iran War Casts Shadow over Egypt’s New Budget

Egypt’s House of Representatives being briefed on the government’s outlook on the state budget (House of Representatives)
Egypt’s House of Representatives being briefed on the government’s outlook on the state budget (House of Representatives)

The economic fallout from the Iran war has cast a shadow over Egypt’s new state budget, Finance Minister Ahmed Kouchouk told parliament on Wednesday, as he presented the draft before it was referred to specialized committees for discussion, with the government pledging swift amendments “to enhance its ability to deal with current and potential risks.”

Kouchouk’s statement came a day after Prime Minister Mostafa Madbouly addressed the House of Representatives, focusing on the damage caused by the conflict and ways to manage its repercussions.

He said the government was treating the current regional escalation as a “prolonged crisis,” whose end is difficult to predict given the complexity and overlap of regional and international dynamics, and suggested its economic effects could last through the end of the year.

During the presentation of the 2026-2027 fiscal year budget, 600 billion Egyptian pounds ($11.5 billion) were allocated for energy subsidies, including electricity support, which rose by 39%, according to the finance minister.

A total of 832.3 billion pounds was earmarked for social protection - a 12% annual increase - to support the most vulnerable groups, alongside 90 billion pounds set aside for programs to support economic activity. (The dollar is equivalent to about 52 Egyptian pounds.)

The minister said spending priorities focus on healthcare, education, social protection, and support for production and exports, alongside flexible precautionary policies to address potential challenges and strike a balance between fiscal discipline and economic stimulus. He pointed to “uncertainty in markets and disruptions in trade and supply chains,” describing them as “major challenges and pressures on economies, especially emerging markets.”

Data presented to lawmakers also indicated a 3% reduction in fuel consumption and a 15% cut in electricity and lighting use in response to recent developments. Regarding national projects, the government decided to postpone or slow the implementation of “slow-moving” or fuel-intensive projects on an exceptional basis for three months, renewable if needed.

According to the minister, the government has also decided to limit spending in the final quarter of the current fiscal year to essential expenditures only, including wages, salaries, pensions, and the needs of the health, electricity and petroleum sectors.

Egypt’s budget has been affected by rising costs of securing energy supplies, prompting the government to increase subsidy allocations in the new budget while relying on consumption rationalization and hedging against future developments in the conflict, said economist Mohieddin Abdel Salam. He noted that Egypt has been significantly impacted by rising oil and gas prices.

Figures presented by the finance minister showed the government has mobilized about 135.6 billion pounds since early March to ensure the stability of vital sectors. This includes 90.6 billion pounds for the energy sector, 30 billion pounds to secure essential commodities, subsidized goods, wheat and sugar, and 15 billion pounds to support the healthcare sector and provide medicines.

Abdel Salam told Asharq Al-Awsat that uncertainty remains over Egypt’s ability to attract foreign investment, as some investors are wary of committing funds in the region due to war-related risks. However, he said Egypt could still benefit from opportunities if it manages to distance itself from ongoing tensions.

He noted that these conditions have led to tighter fiscal policies, reflected in holding interest rates steady rather than cutting them, as well as austerity measures and reduced spending by government institutions.

This can be seen in the new budget, he added, which focuses on vital sectors and strengthening social support, particularly amid declining revenues from the Suez Canal and tourism, and potential impacts on remittances from Egyptians abroad.

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Arab World

Lebanese Contacts with Washington Curb Israeli Escalation in South

Mourners carry pictures of victims killed in an Israeli airstrike on Kafr Rumman in southern Lebanon during their funeral. (AP)
Mourners carry pictures of victims killed in an Israeli airstrike on Kafr Rumman in southern Lebanon during their funeral. (AP)
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Lebanese Contacts with Washington Curb Israeli Escalation in South

Mourners carry pictures of victims killed in an Israeli airstrike on Kafr Rumman in southern Lebanon during their funeral. (AP)
Mourners carry pictures of victims killed in an Israeli airstrike on Kafr Rumman in southern Lebanon during their funeral. (AP)

Intensive contacts between Lebanese President Joseph Aoun and US officials helped curb Israeli attacks that had escalated since Saturday, as Lebanon awaits Washington’s confirmation of a date for an eighth round of negotiations with Israel, expected to be set this week and held later this month.

Israeli attacks in South Lebanon subsided on Tuesday after three days of airstrikes and artillery shelling that killed at least 28 people, wounded dozens and displaced hundreds from Nabatieh and surrounding villages. Residents began returning on Tuesday morning.

Unlike the heavy strikes on Saturday, Sunday and Monday, no Israeli airstrikes were reported by Tuesday afternoon, although drones flew over Beirut, its southern suburbs and other areas in the south.

Israeli forces carried out a demolition in the town of Mansouri, south of Tyre, while an Israeli unit entered the outskirts of Kfar Shouba overnight and raised an Israeli flag on a hill.

Intensive contacts

Ministerial sources close to the Lebanese presidency told Asharq Al-Awsat that Aoun had “conducted intensive contacts with the US side to press Israel to halt its military campaign,” adding that US officials had, in turn, contacted Israel.

The contacts included US Ambassador to Lebanon Michel Issa, while Lebanon’s ambassador to Washington, Nada Hamadeh Moawad, also held talks with US officials aimed at containing the escalation in the south.

On Monday, Aoun warned that Israel’s attacks “will not bring security to civilians along the border” and were targeting the path of the “framework agreement” and undermining efforts to halt escalation in the south and across the region.

“The question today is: Does Israel want peace or war? If it wants war, let that be made clear,” he added.

Lebanon has little leverage to halt Israeli attacks other than through Washington, which it sees as the only available diplomatic channel capable of pressing Israel to cease fire and halt the growing bulldozing and demolition operations in South Lebanon.

Beirut expects a definitive answer from the US by the end of the week on the eighth negotiating session with Israel. Lebanon’s demands in the talks include a ceasefire, Israeli withdrawal from occupied Lebanese territory and the return of prisoners.

US ambassador visits Shiite council

Issa visited the Higher Islamic Shiite Council on Tuesday and met its vice president, Sheikh Ali al-Khatib.

Sources following the visit described it as part of Issa’s protocol meetings with Lebanon’s religious leaders, including Grand Mufti Sheikh Abdel Latif Derian and Druze spiritual leader Sheikh Sami Abi al-Muna over the past two weeks. Others pointed to its timing following al-Khatib’s meetings in Iran and Iraq.

After the meeting, Issa stressed that the United States wanted what was best for the Shiite community and for southerners to return to their land.

On Israeli attacks, Issa noted that his understanding from the Israeli side was that any fire directed at Israel would be met with a response 10 times greater.

Asked about prisoners, he replied that he will keep up his efforts until they are released, saying it was his responsibility.

Condemnation

Lebanese Minister of State for Administrative Reform Fadi Makki condemned the Israeli attacks after meeting Aoun, calling for intensified efforts to halt them and protect Lebanon.

He also stressed support for the Lebanese army and the need for all sides to rally around the state and its legitimate institutions to safeguard the country’s sovereignty and territorial integrity.

Israeli strikes on Lebanon have killed more than 4,300 people since Hezbollah fired rockets at Israel on March 2, two days after US and Israeli strikes on Iran began, prompting an Israeli air and ground offensive against Lebanon.

Lebanon’s Health Ministry reports that the dead include more than 250 children, around 400 women and more than 130 paramedics.

A ceasefire sharply reduced the violence, but Israeli forces occupying large parts of South Lebanon have continued destroying villages inside a unilaterally declared “security zone.” The Israeli military also continues to carry out strikes within the zone and north of it, often without issuing evacuation warnings.

Arab World

Tunisian Journalists Protest Over Media Crackdown

Protesters chant against President Kais Saied, in Tunis, Tunisia, August 20, 2026, demanding the restoration of democracy and calling for the release of jailed activists and journalists amid a worsening economic and social crisis (Jihed Abidellaoui/Reuters)
Protesters chant against President Kais Saied, in Tunis, Tunisia, August 20, 2026, demanding the restoration of democracy and calling for the release of jailed activists and journalists amid a worsening economic and social crisis (Jihed Abidellaoui/Reuters)
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Tunisian Journalists Protest Over Media Crackdown

Protesters chant against President Kais Saied, in Tunis, Tunisia, August 20, 2026, demanding the restoration of democracy and calling for the release of jailed activists and journalists amid a worsening economic and social crisis (Jihed Abidellaoui/Reuters)
Protesters chant against President Kais Saied, in Tunis, Tunisia, August 20, 2026, demanding the restoration of democracy and calling for the release of jailed activists and journalists amid a worsening economic and social crisis (Jihed Abidellaoui/Reuters)

Tunisian journalists protested on Tuesday to demand the release of prominent journalist Mohamed Yousfi, whose arrest has become a new flashpoint amid accusations that President Kais Saied is cracking down on the country's ‌remaining independent voices.

 

The protesters, who also included activists, gathered outside a court where a judge was questioning Yousfi over illicit enrichment and money laundering charges, which critics say were fabricated to punish him for his outspoken journalism.

 

Yousfi, a fierce critic of Saied and the editor-in-chief of investigative news website ⁠Al-Qatiba, was arrested last Friday as he was preparing to enter Express FM Radio to take part in a radio program.

 

His arrest prompted widespread condemnation of Saied’s government, with rights groups saying the case was aimed at increasing a climate of fear among journalists.

 

“The situation is dark and difficult. Journalists who disturb the authorities are facing legal persecution and fabricated charges,” Zied Dabbar, the head of journalists' syndicate SNJT, told Reuters.

 

“Today journalists either end up in exile or in ‌prison... ⁠But we will resist,” he added.

 

Several media figures have been jailed this year, including Zied Heni, Mourad Zghidi and Borhen Bsaies, while Khaoula Boukrim was sentenced in absentia in June to four years.

 

Free speech initially flourished following the 2011 uprising that toppled Zine El Abidine ⁠Ben Ali and ignited pro-democracy protests known as the “Arab Spring.”

 

But critics say Saied's accumulation of power in 2021 and decrees he has issued since then have dismantled democratic safeguards ⁠and enabled the authorities to pursue many journalists.

 

The leaders of Tunisia's main opposition parties have been jailed in the last three years, along with dozens of ⁠politicians, activists, journalists and businessmen, on charges of conspiring against state security, of money laundering and corruption.

 

Saied says he will not be a dictator and that freedoms are guaranteed in Tunisia.

 

 

Arab World

Hate Speech and Attacks: What Is Happening to Iraqis in Iran?

A still photo from a widely circulated video showing the attack on Iraqi students in Iran.
A still photo from a widely circulated video showing the attack on Iraqi students in Iran.
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Hate Speech and Attacks: What Is Happening to Iraqis in Iran?

A still photo from a widely circulated video showing the attack on Iraqi students in Iran.
A still photo from a widely circulated video showing the attack on Iraqi students in Iran.

Official assurances that attacks on Iraqi students at Iran’s Semnan University have been contained have failed to quell questions over what sparked the violence, and whether growing anti-Iraqi and anti-Arab sentiment in Iran played a role.

The questions center on whether nationalist hostility and anger over financial and economic hardship caused by sanctions and war drove a group of Iranians to attack Iraqi students at their residences.

News outlet Shabaka 964 quoted traders and residents in Iran as saying that “an influential segment of Iranian society can no longer tolerate seeing even the small numbers of Iraqis passing through Iran.”

“An Iranian who supports Supreme Leader Khamenei sees an Iraqi as being under the Trump administration’s control, while an Iranian who supports the overthrow of the supreme leader’s regime sees an Iraqi as a supporter of the Popular Mobilization Forces and the supreme leader, and perhaps as someone involved in killing dissidents,” they added.

Attack begins

The incident began on Sunday when two heavily intoxicated Iranians tried to force their way into the students’ residential building. The students confronted the intruders and removed them from the building to prevent any misconduct and safeguard the premises and its residents.

The situation then escalated rapidly, with about 150 people gathering around and inside the building and attacking the Iraqi students. Several students suffered physical harm and injuries, while their personal property was damaged and the building’s windows were smashed as they tried to repel the attack and shelter themselves inside.

However, the Iraqi cultural attaché in Tehran denied that any students had been injured and described the incident as a “personal” dispute that had not been planned by the Iranian group.

Video testimonies

However, the return of some Iranians to the students’ residence the following day lends weight to unofficial accounts that describe the attack as deliberate and linked to resentment among some Iranians over the presence of Iraqis in the country.

Iraqi students appeared in video testimonies urging fellow students not to leave their residences and to leave Semnan province and its university because the area had “become dangerous and unsafe” for Iraqis.

They also said some Iranians had carried knives to attack Iraqis as they went shopping in nearby markets.

Follow-up committee

After Iraq’s Foreign Ministry faced criticism over its delayed response to appeals posted on social media by some of the students who were attacked, the ministry said on Monday that it had sent a committee to Iran’s Semnan province to follow up on the incident.

The ministry said in a statement that it had “followed with great concern the attack by a number of Iranian citizens on several Iraqi students at their residence in Semnan province in Iran.”

It added that “Foreign Minister Fuad Hussein directed the Iraqi Embassy in Tehran to ascertain the circumstances of the incident. The embassy sent a committee to check on the students, liaise with the relevant Iranian authorities and follow the course of the investigation, stressing the need for legal action against those responsible.”

The statement praised “the measures taken by the Iranian authorities to protect the students and transport them to their university to sit for their examinations.”

One-month leave

Following the Foreign Ministry’s statement, the Iraqi Embassy in Tehran said the crisis involving Iraqi students in Semnan province had been contained and that they had been granted one month’s leave.

The embassy said in a statement that “with the participation of the Iraqi Embassy and the Iraqi cultural mission, a delegation traveled to Semnan province to examine on the ground the circumstances of the crisis involving Iraqi students and directly assess their situation.”

It said the delegation “held meetings with university officials, Semnan provincial officials and the relevant authorities with the aim of addressing the aftermath of the incident and ensuring the safety of Iraqi students.”

“The crisis has been fully contained, and the Iraqi students have been granted one month’s leave to help calm the situation and restore stability to the university environment,” it added.

Iranian judiciary takes action

Mohammad Sadegh Akbari, head of the judiciary in Iran’s Semnan province, said on Monday that two people involved in the attack on Iraqi students had been identified. He said the public prosecutor in the provincial capital had issued orders summoning them before the relevant security authority.

Akbari told Iran’s state news agency IRNA that “two people involved in the clash outside the residence of Iraqi students at Semnan University have been identified. Judicial investigations are continuing to identify all those responsible for the incident, and those involved will be dealt with in accordance with the law.”

Akbari said the provincial judiciary was examining all aspects of the incident thoroughly and that, once the investigation was complete, legal and judicial action would be taken against anyone found to have played a role in the clash and in the disruption of public order and security.

Attack ‘not a coincidence’

Commenting on the attack, journalist Muntazer Nasser, who spent part of his life in Iran, said it “was not a mere coincidence” but the result of “a long series of hate speech on Iranian social media, with no official Iraqi action to counter it.”

Nasser said in a Facebook post that he had been monitoring anti-Iraqi rhetoric on Iranian social media since October 2025, beginning with “an unsubstantiated accusation that an Iraqi student at the University of Hamadan had harassed an Iranian female student, which developed into large demonstrations across the city.”

Nasser said he believed the demonstration was “a form of protest against the Iranian regime, but fear of confronting it led people to vent their anger by protesting against the Iraqi student.”

“Hate speech against Iraqis then resurfaced through a series of widely circulated videos purportedly showing members of the Popular Mobilization Forces entering the country, according to the many accounts that shared them, to suppress popular protests.”

“The rhetoric then intensified alongside images of luxury Iraqi cars driving through Iran with Iraqi license plates, which were contrasted with the poverty endured by Iranian society,” he added.

Nasser also pointed to the kidnapping of a considerable number of Iraqis and, most recently, the beating of seven tourists in the northern Iranian region of Gilan about two weeks earlier by some local residents and in full view of Iranian police, according to his account.

Nasser said the Iraqi Embassy in Tehran “should have monitored the escalation of this rhetoric from an early stage, drawn up a plan to counter it and warned its citizens. If it was unable to protect them, it should have informed the Foreign Ministry so that it could intervene at a higher level.”