2 - 8 May 2002
Issue No.584
|
Al-Ahram Weekly Online 2 - 8 May 2002 Issue No.584 |
||
| Published in Cairo by AL-AHRAM established in 1875 | Current issue | Previous issue | Site map | ||
Egypt, inc.
In her first encounter with a joint business association, minister of state for foreign affairs, Fayza Abul-Naga, pitched Egypt's investment prospects to British and Egyptian executives. Soha Abdelaty reports
"This is a market with great potential," Fayza Abul-Naga, minister of state for foreign affairs, told a group of Egyptian and British entrepreneurs at a luncheon organised by BEBA, the British Egyptian Business Association. "The government of the United Kingdom, as well as the business community there... have always been first partners for Egypt in terms of investment. More, however, is needed," she continued.
Abul-Naga's talk was on the "New Horizons for Investment and Cooperation in Egypt." The minister began her discussion by outlining the hurdles facing the Egyptian economy, and then reassuring her audience that the government has a clear vision of how it intends to clear them.
"It would be no exaggeration if I told you that Egypt was the hardest hit by the events of 11 September," Abul-Naga began. "We have incurred heavy losses in major sectors of our economy." Moreover, she argued, "Unprecedented Israeli aggression.....has made this area less attractive than it should be for investors" and "Egypt is paying the price." The result has been a budget deficit of $2.5 billion for this financial year.
The way to lead Egypt out of this morass, according to Abul-Naga, is to integrate Egypt into the world economy, and continue the economic reform programme. A notable step was recently taken on the path of integration when the European Union (EU) Association Agreement was signed last June, and which, according to Abul-Naga, the Egyptian parliament will soon ratify. Abul-Naga added that Egypt is keen on a multilateral trading system based on clear rules, despite what some may think, as this can protect the interests of developing states. "But," she warned, "the system should be fair and equitable." The minister pointed out that Egypt's farming produce currently faces forbiddingly high barriers which denies it fair access to European markets. "The EU spends a billion dollars a day on farm subsidies. In other words, a billion a day spent on closing markets to our products," Abul-Naga observed.
On reforming macro-economic policy, business people are generally keen for a market-based exchange regime, with a flexible exchange rate, and some key legislative changes. Abul-Naga tried to assure the business community that the government is actually committed to implementing a flexible exchange rate system: "We have come to realise that it is no longer possible for the government to stick to a fixed exchange rate...But change will not happen overnight," she said.
Just as important in the economic reform programme are the legislative changes currently being introduced to parliament. Abul-Naga referred to the draft law on intellectual property rights, the unified labour law, the law combating money laundering, a basic telecommunications and information technology (IT) agreement, legislation that aims to reduce customs tariffs, the real estate mortgage law and the banking law.
In following the reform programme, Abul-Naga said, the government has set itself certain priorities, including creating jobs, integrating rural development, enhancing industrial capacity and last but not least, promoting exports. This last priority was a "matter of life or death for Egypt," the minister said, and it is in fulfilling these priorities that Egypt hopes for international help. Projects that address these priorities were the ones the international donor community agreed to pledge $10.3 billion for last February. At the Consultative Group meeting of the World Bank, 37 donor countries and associations surpassed the Egyptian government's expectations, their donations and grants exceeding the $2.5 billion originally asked for to cover the budget deficit. "What was extremely rewarding and encouraging was the message behind the money," remarked Abul-Naga. "It said that Egypt has foreign friends [and] it gave our efforts new impetus," she added.
It is now the task of members of associations like BEBA to make good on this message by investing in Egypt. Abul-Naga assured the business people that there are several reasons why investing in Egypt is a good idea. For starters, the figures point to macro-economic stability: the growth rate is five per cent, inflation is at 2-2.2 per cent, unemployment stands at 7.6 per cent and 180 companies have been privatised, with more on the way. Egypt has 67 million inhabitants, plays an influential regional role, and has many promising investment areas, including oil and natural gas, IT, agriculture, pharmaceuticals and the "classic investment area," tourism. All in all, the money invested in Egypt should be ploughed into projects with long-term prospects, the minister thinks. "I am only interested in money that will do something tangible for the average Egyptian," she concluded.
© Copyright Al-Ahram Weekly. All rights reserved
 |
|
|||||||||||||||||
| ARCHIVES Letter from the Editor Editorial Board Subscription Advertise! |
WEEKLY ONLINE: www.ahram.org.eg/weekly Updated every Saturday at 11.00 GMT, 2pm local time weeklyweb@ahram.org.eg |
 Al-Ahram Organisation |
Recommend this page