• February 22, 2010
  • 9 minutes read

Unfolding Opportunities and Challenges in Egypt

Unfolding Opportunities and Challenges in Egypt

We travelled out to the Giza section of Cairo to tape our video links for the programme wanting to utilise the fabled backdrop of the Pyramids for maximum impact. Egyptians normally cringe at the thought because they believe the image represents the past and they want to be seen as modern like some of their Gulf neighbours with an abundance of mirrored skyscrapers.

When we arrive to meet our media handler from the information ministry we were told this shoot would cost £2200 Egyptian pounds, about $400 for permits into two special areas.  Were we surprised?  Yes.  Could we justify the out of pocket cash-only expense? Certainly not.

So in true Egyptian form, our media guide ponders a quick solution.  We circle back by mini-van and within a half hour find a spectacular, nearly secluded venue with lush agriculture and palm trees in the foreground of the Pyramids on a clear, softly lit, breezy day. 

The end result was superb.  Along the way we missed an on ramp and our driver proceeded to reverse course (backwards) about a quarter kilometre down the road dodging trucks, cars and mule drawn carts.  It was at that juncture I decided to reapply the seat belt.  Would one describe this as normal operating procedure?  No.  Inventive?  No doubt.Let’s fast forward to the afternoon session of the Economist Roundtable at Cairo’s Grand Hyatt Hotel, with presentations from Prime Minister Ahmed Nazif followed by three key ministers of Economy, Trade & Industry and Investment. The concept was to give investors and complete a picture of where this country of 80+ million consumers and a two thousand year history is going over the following ten years.

The conversation is frank.  Poverty levels are coming down, albeit at a much slower pace than they would like to see.  Growth is expected to hit five and half per cent this year.  This is respectable by global standards, but not the seven per cent level that proceeded the global recession. All four ministers fielded questions from the audience, but were surprisingly not asked about tensions with the Muslim Brotherhood or whether the ultimate boss in Egypt, President Hosni Mubarak, will run again in 2011. 

One could read that lack of enquiry two ways:  Investors want to avoid potentially embarrassing questions and feel business and politics don’t mix. Or they are comfortable with the concept and trust that an eventual transition to his son Gamal or another handpicked successor will be handled. Period. 

Stability is the watch-word; ask any local businessman or foreign investor. 

The cabinet ministers continue to answer questions and remain focussed on the next wave of reforms:

·         Cutting through bureaucracy to double trade exports in the next ?four years

¶ Boosting internal trade by modernising the local infrastructure.  Corner shops will be phased out to welcome companies like French hyper market giant Carrefour which now calls ?Egypt home.

·         Build out the road and rail infrastructure so places like Upper Egypt get connected to the global economy.

It is hard to disagree with the industrial logic.  I honestly planned to listen to one presentation and politely leave and ended up staying for all four because I was taken in by the strategy.  This cabinet is looking east for growth.  Egypt recently hosted a giant Chinese summit in Sharm el Sheikh. Trade and Industry Minister Rachid Rachid just came back from Southeast Asia to forge commercial links and pick up some of the best practices from trade hubs like Singapore and Malaysia.  To round out the strategy, the government tapped into European Union structural funds to assist in making the slick PowerPoint presentation become a reality.

After the conference, I hail a taxi for my ride back.  Through the window frame one takes in scene after scene of Cairo’s complexities and why it is nearly impossible to govern. 

One would have to be blind not to see the grinding poverty – those citizens struggling against a badly dealt hand to survive.  Seconds later, I pass construction sites with activity.  The country attracts foreign direct investment from the banking sector to tourism.  All the brand name hotels seem to have a presence on the grand Nile.  A fast growing population is extremely difficult to manage with 650 thousand new entrants into the workforce each year, but investors like the potential of the youngest and largest consumer market in the region. I arrive back to my hotel after what was a remarkably short taxi ride.  My driver said I was a blessed man and his lucky charm because we avoided the famously chaotic Cairo traffic.   As I comb through the lobby another wave of visitors check in; this time a small army of Italians.  They did not come to Egypt to listen to ministers outline their plans for modernisation and reforms.  Instead they were busy planning their visit to Giza and of course the fabled Pyramids.