21 - 27 June 2001
Issue No.539
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Al-Ahram Weekly Online 21 - 27 June 2001 Issue No.539 |
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Gearing up for competition
Industrial officials and businessmen gathered this week to discuss how Egyptian industry could better prepare itself to take on foreign competitors. Shaimaa Labib attended
With the advent of trade liberalisation, and the impending signing of the Egyptian-European Partnership agreement, Egyptian industry will be facing a number of serious challenges. This was the gist of a seminar organised this week by the Ministry of Industry and Technological Development in collaboration with the El-Sadat Academy for Management Sciences. Participants examined the ministry's endeavours to help factories modernise their establishments and products in order to tackle the competition ahead.
"We could face these challenges if we start implementing a comprehensive plan for modernising Egyptian factories and industrial companies to help them better compete in local and international markets," Minister of Industry and Technological Development Mustafa El-Rifa'i argued.
For its part, the ministry has conducted a national industrial survey to determine the exact number of factories and industrial companies in Egypt, which will help it identify the ones in dire need of modernisation. The plan, conducted in collaboration with the Cabinet's Information Decision Support Centre (IDSC) and the Central Agency for Public Mobilisation and Statistics (CAPMAS), revealed that there are around 23,000 factories and companies in Egypt, most of them private.
El-Rifa'i said an estimated 70 to 75 per cent of the factories are privately-owned, while the rest are either in the course of being privatised or are slated for privatisation in the near future. "The owners of these establishments are the ones responsible for modernising them. The role of the ministry is to provide them with information about modernisation techniques," he said.
To help these companies obtain this kind of information, market and design their products and train their staff, the ministry is planning to establish several technological centres by the end of the year. "For this purpose, the government has allocated LE150 million from this year's state budget," El-Rifa'i said.
The ministry will also publish an index listing all Egyptian industrial products to help industrialists promote themselves locally and internationally. "It is expected that the index will contribute to increasing Egyptian industrial exports, which are still very minimal when compared to those of other developing countries," El-Rifa'i said.
The ministry has drawn up a strategic plan to increase the national industrial output to LE200 billion by 2010, he said, compared to LE60 billion in 2000.
According to Hamdi Abdel-Azeem, head of the El-Sadat Academy Research Centre, the main aim of the national programme for modernising Egyptian industry is to provide factories with the appropriate infrastructure to enhance their competitiveness. "This could be done through providing them with technical support for modernising their factories and upgrading the technical skills of their human resources," he said.
High interest rates on loans that industrial companies aim to secure to finance their modernisation requirements is one of the hindrances facing these companies, participants said. "We have agreed with the Finance Ministry that the interest rate will be reduced from the current 14 per cent to only seven per cent. The government will underwrite the difference," El-Rifa'i said.
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