CRISIS IN THE PERSIAN GULF : Egyptian Refugees Find Tough Times at Home : Fallout: The crisis hits hard at the country’s economy. Politically, the climate in Cairo is also glum.

Shawqi Aql got out of Kuwait with his Chevrolet Blazer, his television and a VCR. The cash was left behind.

“Ten years’ savings--finished,” the 40-year-old engineer said with a cheerful shrug of his shoulders.

Aql has been lucky. He has picked up a couple of contract jobs since his return to Cairo. For most returning Egyptians, there has been no work. The Kuwait heydays are over. Welcome home.

Every Arab country caught in the vortex of the Persian Gulf crisis has suffered economic and political strains. For Egypt, the most populous at 55 million, the blow fell heavily on its top three sources of hard currency: remittances from workers abroad, tourism and Suez Canal fees.

“It seems every Egyptian family had someone working in Kuwait or Iraq,” explained Salama Ahmed Salama, managing editor and columnist of the authoritative Al Ahram, the country’s leading daily.

By unofficial estimates, as many as a million Egyptians were working in the gulf when the Iraqi army invaded Kuwait, more than 800,000 of them in Iraq and another 180,000 in Kuwait.

“Most of them lost everything they had,” Salama said.

However, the crowded, dirty streets of Cairo and the villages of the Nile showed no signs of desperation last week. Egypt, as old as time, perseveres.

One senior Western envoy, reaching for the word, came up with “uncomfortable” to describe the economic atmosphere.

In the big Nile-side hotels, the chatter of French and Japanese tourists echoes in the corridors. But in the first cool week of autumn, the traditional start of the high season, occupancies are down by 60%, hotel officials say.

“Just the locals are coming by,” added a British shop owner on the Zamalek, an island in the Nile usually crawling with foreigners at this time of year. “It looks like a writeoff.”

Politically, the climate is also glum. “At the start,” the senior diplomat explained, reviewing the evolution of the Egyptian attitude on the crisis, “(President Hosni) Mubarak was angry and righteous. (Iraqi President Saddam) Hussein had lied to him, he said. He wanted the Americans to knock him right out.

“That didn’t happen, and the policy from Washington and London called for waiting out the embargo. The thing appeared to drift, and still does. The feeling here is one of disarray. But Mubarak won’t be backing down. He has no particular respect for the Iraqis.”

A city the size of Cairo simply absorbs political shock. For instance, the brazen assassination of parliamentary Speaker Rifaat Mahgoub on Oct. 12 had become little more than a highlight of coffee-shop gossip a week later. Theories flourished as the government said little: It was a terrorist hit ordered by Iraq; it was a case of mistaken identity--the target was meant to be Interior Minister Mohammed Abdel-Halim Moussa; Mahgoub was the target, but the motive was personal.

Diplomats said Saturday that Moussa’s police were rounding up the usual suspects. The Cairo press published a purported leak that Palestinians were involved. Charges are expected soon.

The problem of the returnees, the hundreds of thousands of Egyptian professionals and farm workers who fled the gulf, is a deeper issue. Among the first waves of refugees, driven by their government’s prompt and hard stand against the invasion, the Egyptian hordes poured out of Iraq into the desert camps of Jordan and, eventually, home to a country that had no work for them.

“This is the problem of President Mubarak, how to absorb these people,” Salama, the Al Ahram editor, noted. “They need jobs, their children must have places in schools. The Kuwaitis have offered $50 million to cushion the blow. But what does that amount to? Maybe $500 or less for every returning worker. It’s a minimal sum.”

Aql, the civil engineer, was pulling down about 800 Kuwaiti dinars a month, the equivalent of more than $2,500 before the invasion. “I had to pay rent and other expenses, but I was saving and living was good,” Aql told a reporter. “I don’t think we’ll see that light again.”

Major international pledges to sustain Egypt, Turkey and Jordan, the countries hardest hit by the embargo against trade with Iraq, have yet to come through. According to diplomats, some Egyptian officials are showing impatience with the principal donors, including Saudi Arabia, Kuwait, Japan and Germany.

But there is no indication that Mubarak will back off his tough stand against Iraq. Egyptians do not feel threatened by the prospect of war in the gulf. The potential battlefields are far away. No one is selling gas masks in Cairo.

Diplomats say, however, that the president is disappointed by the standoff. “He wanted to use the period of confidence to build a political consensus here,” a foreign political analyst said. Instead, Egypt has slipped back into a political morass.

New parliamentary elections are scheduled for Nov. 29, and the opposition parties are forming a boycott bandwagon. The largest, the New Wafd Party, declared last week that it will not take part. And an even larger alliance--the Socialist Labor and Liberal Socialist parties--and deputies from the Muslim Brotherhood are expected to follow suit.

The prospect of Mubarak’s National Democratic Party ruling the National Assembly without opposition presents a cosmetic problem. It would also remove the government’s only reliable sounding board for its policies, since political polling is not permitted in Egypt and the partisan press is not considered a good measure of public attitudes.

But a one-sided Parliament--the constitutional court ordered new elections in a dispute on candidate qualifications--will not diminish the power of Mubarak, a former air force officer. “The power in Egypt resides with the military,” the senior Western diplomat said. “Elections will not change that.”

The fundamentals of the economy are also enduring in their way. Egypt, with a foreign debt of nearly $50 billion, is in the Latin American league. Inflation is estimated at 25% or more. Cairo has been fencing for several years with the International Monetary Fund, which demands hard decisions--such as eliminating government subsidies on bread--in return for help in restructuring its debt. No agreement has been reached.

But with remittances from workers in the gulf, tourism, Suez Canal tolls and some oil exports, Mubarak’s government was able to survive on the economic edge, an Egyptian tradition. Now, the upheaval of the past 2 1/2 months poses a test to Cairo’s survival instincts.

The country’s primary problem is food. More than 50% of its requirements are imported, and a galloping birthrate promises to stifle improvement.

This and other fundamental problems were cushioned by the remittances, an estimated $3 billion every year coming into the Egyptian economy. Much of it came through bank transfers--in dollars--which gave the government hard currency for food imports. Some came outside banking circles, pushing dollars into the black market. Enough of the latter reached the villages to keep families afloat.

“Now the fellaheen (farm workers) are back home,” the diplomat said. They can help on the family farm, but they’re really just another mouth to feed. And the money is no longer coming in.

For the professionals who lost their jobs and fortunes in Kuwait and Iraq, the situation is less flexible. With the economy pinched by the effects of the crisis, there will be few new jobs in their field.

Meanwhile, investment is drying up. “The typical Egyptian businessman tends to spread his risks,” the diplomat explained. “He probably puts a bit into the tourist business, and then maybe something into a small industry. With the tourists staying home, he’s getting no return to spread into industry. The job creation goes phfft.”