The economic reforms being implemented by President Abdul Fattah al-Sisi’s government are already generating an increasing sense of stability in Egypt.

In November, the Washington-headquartered IMF recognised that the policies are encouraging a “return to confidence” in the economy.

Yet the government’s hardline efforts to bring about political stability are more divisive.

While some Egyptians are willing to see some of their civil liberties dissolve in return for growth, jobs and investment, others are concerned about the repressive nature of Al-Sisi’s policies.

The clampdown on the Muslim Brotherhood, the handing out of hundreds of death sentences to brotherhood members and new limitations on public demonstrations and non-government organisations might achieve short-term stability. but they are also likely to lead to bitterness that will overspill into unrest or even terrorism in the long term.

Egypt’s economic policy is trying to achieve both short and long-term gains, aiming to please potential investors while protecting the interests of Egypt’s people, particularly the poor.   

The decision to cut fuel subsidies earlier this year was an investor-friendly decision. At the same time, Al-Sisi’s government is introducing a cash transfer scheme to compensate the poorest people that are affected by rising fuel costs and, therefore, trying to limit street protests and unrest.

Other socially minded policies include using some of the proceeds from the new property tax to fund improvements to slums.

Such measures are helping economically appease Egypt’s society as the government takes the country through a painful transition.

Al-Sisi should consider a similar approach when trying to build political stability. Its current hardline approach may be temporarily accepted by a revolution-weary people, but it risks storing up trouble for the future.