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Al-Ahram Weekly 27 May - 2 June 1999 Issue No. 431 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 27 May - 2 June 1999 Issue No. 431
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| Published in Cairo by AL-AHRAM established in 1875 |
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Egypt Region International Economy Opinion Culture Profile Living Features Travel Sports People Time Out Chronicles Cartoons Letters New markets in Africa
by Mona El FiqiIn the gallery of the Cairo International Confernce Centre, tens of Egyptian companies are displaying a variety of quality products and services produced by the private sector. The exhibition was held in conjunction with the meeting of the African Development Bank, attended by more than 1,500 members from 77 African and non-African countries. Tourism Minister Mamdouh El-Beltagui inaugurated the exhibition.
Now that Egypt has joined the Common Market for Eastern and Southern Africa (COMESA), the way has been paved for the private sector to open up new African markets for Egyptian products, through holding exhibitions, sending delegations, and applying good marketing policies. This will be the task of a newly established committee affiliated to the Egyptian Businessmen's Association (EBA). "The aim of the exhibition is to show our African guests the developments which have occurred in the Egyptian manufacturing and service industries," said the EBA's Secretary General Taher El-Sherif.
The exhibition displays products from different Egyptian industries such as construction, pharmaceuticals, food industries, furniture, insurance and household appliances, and from the service sector.
Although the African countries are viewed by Egyptian exporters as very good markets for their products, Egyptian businessmen still face some problems when they try to export to Africa.
Mohamed El-Aref, marketing manager at the Nile Company for Food Industries, "Injoy", said that his company exports 35 per cent of its production to the US, the European countries and some Arab countries. But when the company started to export to Ghana a few months ago, it met with some difficulties.
Bureaucratic measures still delay the exportation process in Africa: "After one month and a half of following exportation procedures, we could hardly meet our deadline with the African importer, which was stipulated as two months in the contract," El-Aref said.
Mamdouh El-Beltagui inaugurating the EBA exhibition
Another major problem is high transportation costs which have resulted in increasing Egyptian products' prices -- making them lose their competitiveness in African markets.
El-Sherif shares El-Aref's opinion, saying: "The high cost of transportation is due to the lack of direct lines to some African countries, particularly the land-locked countries. This makes it difficult for Egyptian exporters to reach these markets."
The transportation problem will be resolved if a new shipping line is established from Alexandria, cutting across the African continent to reach South Africa.
Transportation, in fact, is not the only problem Egyptian exporters face. El-Sherif said that the lack of sufficient financing and insurance covering commercial and non-commercial risks also hinder the exporting process.
The problems faced by Egyptian companies in the African markets vary according to the sector they belong to. Reham Maher, public relations representative at the Arab Contractors Company for Construction, said that although her company was one the first Egyptian companies to begin projects in African countries five years ago, employees of the company "have met with difficulties in adapting to the living conditions in these countries."
Egyptian exporters face many problems that are not confined to African markets. El-Sherif said that although the volume of Egyptian exports increased by 1.7 per cent in 1998, the increase was still not high enough. "In 1998 our exports were valued $5 billion while our imports were worth $17 billion. The gap between the volume of imports and exports is the only blemish in the Egyptian economy, given its success in implementing the economic reform programme," he said.
The inadequate performance of the export sector is due to the lack of competitiveness of Egyptian products compared with the products of other countries, the absence of efficient marketing polices, the lack of direct transportation lines to some countries, and the high costs of exporting, specifically the costs of financing and insurance, according to El-Sherif.
ADB governors meet
THE AFRICAN Development Bank (ADB) held its 35th annual board of governors meeting in Cairo this week. Established in 1966 as a development finance institution, ADB funds economic and social projects in the African countries.
On the agenda of this year's meeting is the progress made on the bank's fifth general capital increase approved during last year's meetings in Abidjan, and share transfer rules.
The meeting was attended by ministers of finance and governors of the central banks of the member countries.
A memorandum of understanding (MOU) was signed between ADB and the Export-Import Bank of India for the co-financing of private and public sector development projects, information exchange and the organising of workshops and seminars.
An MOU for combating desertification was also signed this week by ADB President Omar Kabbaj and Hama Arba, executive secretary of the United Nations Committee to Combat Desertification (UNCCD).
A cooperation agreement between ADB and the Common Market for Eastern and Southern Africa (COMESA) is also expected to be signed during the Cairo meeting. This will be the eighth cooperation agreement to be signed between ADB and sub-regional institutions in Africa.
