History, Increased Foreign Involvement

Ismail Pasha was Egypt’s ruler at the time the canal opened. The Ottoman sultan had granted him the hereditary title of khedive two years earlier. Ismail used the canal’s inaugural celebrations to showcase the country’s Westernization, which included the construction of European quarters in Cairo and Alexandria, sumptuous palaces, the Cairo Opera House, and many factories, railways, and telegraph lines. He dispatched military expeditions to expand his empire in Sudan and to explore the African interior. The government could afford such luxuries because of the booming demand for Egyptian cotton, caused by shortfalls of American cotton as a result of the American Civil War (1861-1865). Foreign banks and individuals eagerly invested in Egypt’s economy.

Economic conditions later deteriorated, forcing Egypt to borrow from foreign creditors to finance its projects. To stave off economic crisis, the government adopted drastic measures such as collecting taxes in advance, selling its shares in the company that operated the Suez Canal, and finally declaring bankruptcy. Egypt’s inability to pay back its loans led to the appointment of foreign debt commissioners to monitor Egypt’s finances in 1876, the inclusion of British and French ministers in Egypt’s cabinet in 1878, and finally the forced abdication of Ismail in 1879. Under European pressure, the Ottoman sultan installed Ismail’s son, Tawfik (also spelled Tawfiq), who cooperated with Egypt’s foreign creditors.

Some Egyptians formed nationalist groups to combat the rising European influence. Inspired by Iranian-born Islamic activist Jamal al-Din al-Afghani, who lived and taught in Egypt for eight years, Egyptians produced plays and published newspapers demanding independence and constitutional rule. Demands for more control over their own country increased when the foreign debt commissioners reduced expenditures on education, economic development, and defense.

During the reigns of Said Pasha and Ismail Pasha, Egyptians had gradually been allowed to enter the officer corps of the military. Egyptian officers organized secret societies in response to discrimination by the traditionally dominant Turkish and Circassian officers. In 1881 an Egyptian colonel named Ahmad Arabi led a mutiny against the war minister and later a larger demonstration against the khedive. He demanded a popularly elected legislature and an increased budget for the army. In early 1882 the nationalists gained control of the cabinet and the army, threatening the Turkish and Circassian officers and even the khedive himself. Riots broke out in the port cities, and Britain and France sent warships to blockade Alexandria harbor.

Arabi, now minister of war, refused an ultimatum to pull down Alexandria’s fortifications. On July 11, 1882, British battleships bombarded Alexandria, setting the city afire. Khedive Tawfik, siding with Britain, declared Arabi a rebel, thus setting the stage for a British invasion and occupation, first of Alexandria, then of the Suez Canal, and finally (after defeating Arabi’s troops at Tel al-Kabir) of Cairo itself. Arabi and his followers were jailed, put on trial, and exiled from Egypt, and the khedive was restored to power.