Thursday,20 September, 2018
Current issue | Issue 1357, (17 - 23 August 2017)
Thursday,20 September, 2018
Issue 1357, (17 - 23 August 2017)

Ahram Weekly

Infrastructure matters

اقرأ باللغة العربية

At a time when Egypt is focused on raising levels of foreign direct investment (FDI), accidents happen confirming the dire need to focus on improving infrastructure and public utilities in order for investments to have good and viable returns in the long run. Expanding infrastructure projects contributes to raising economic growth rates and creating new economic opportunities. Most importantly, it facilitates investing in human capital. Accordingly, there is a pressing need to raise investment rates in infrastructure, which is the policy of many emerging countries and developing economies to reach clear goals such as reducing poverty rates, reaching sustainable development goals, and effectively combating the impact of climate change.

International studies show that the absence of necessary infrastructure and public utilities hinders sustainable development, while there is growing support for partnerships between the public and private sectors to improve performance and implementation of infrastructure projects. At many of the economic conferences attended by the president recently, there were assertions we are currently confronting challenges that began a long time ago. There are chronic economic problems, and hefty spending on services, subsidies and infrastructure. We need to find alternative means to fund overhauling public utilities and completing needed infrastructure projects to attract more investment.

Egypt still has a long way to go. A study published by the Central Agency for Public Mobilisation and Statistics on infrastructure in 2015 places Egypt at 100 among 144 countries regarding indicators of achieving basic infrastructure requirements for 2015.

Despite high performance in road building, power generation, water delivery, and sewage treatment over the past two years, resident needs remain high, especially due to high birth rates, estimated at 500,000 in 84 days according to the latest official statistics, which puts immense pressure on public utilities. One cannot deny that public utilities have been greatly harmed due to targeting by terrorist attacks to disrupt the state and halt the wheel of development.

On 6 August, President Abdel-Fattah Al-Sisi issued Law 146/2017 adopting a plan for economic and social development for fiscal year 2017-2018, after it was approved by parliament. The plan includes allocating large investments for public works and infrastructure. The figures by the Ministry of Planning, Follow Up and Administrative Reform show that 60 per cent of government investment is allocated for improving infrastructure, especially transportation, housing, public utilities, agriculture, irrigation and electricity.

Minister of Planning Hala Said said these investments aim to provide an attractive climate for foreign and domestic investment, especially small, medium and micro projects. This would increase economic growth by increasing GDP, raise operation levels, create large numbers of jobs and directly improve the quality of life of citizens.

Developing infrastructure in Egypt is a paramount challenge that requires combining efforts by the state, private sector and international partners to achieve the goals of the ambitious plan.

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