#Egypt #TheWorldfolio SUNDAY, APRIL 14, 2019 01

This Special supplement was prepared by The Worldfolio. The production of this supplement did not involve the news or editorial staff of The Washington Post. For more information contact The Worldfolio. Africa’s top investment Bold economic reforms pay major dividends The Egyptian government has implemented reforms and laid down the plans that will ultimately allow the private destination sector to take the driving seat on the road towards sustainable development and inclusive growth. Egypt is now the second- After some turbulent years follow- “For economic growth this largest recipient of direct ing the Arab Spring in 2011, Egypt’s year, we are targeting 5.6 U.S. investments in the economy has bounced back and is Middle East. now primed and ready to reach percent and for the next year new heights. Politically and eco- we’ll be working very hard Egypt has been identified as the nomically stable, the North African to reach 6 percent. I think African continent’s best invest- nation is pushing ahead with a re- this is quite outstanding. I’ve ment destination for 2019 – an form agenda and visionary plan for honor it is celebrating for the sec- the future that includes hundreds seen a lot of reports showing ond consecutive year. of billions of dollars worth of pro- that Egypt was among the The accolade, awarded by Rand jects across the board – from brand WRSͤYHJURZLQJFRXQWULHVLQ Merchant Bank (RMD), attributes new cities to the game-changing the world” Egypt’s top-spot to two factors: Suez Canal Economic Zone, which that the country is Africa’s high- has already attracted some of the plementing new initiatives to subsi- est gross domestic producer, and world’s largest companies. dize exporting and the contribution that it enjoys the single larg- Last April, the Egyptian people of the private sector to improving est consumption market in the voted to keep incumbent president the country’s negative trade bal- MENA region. Abdel Fatah El-Sisi in power, allow- ance, which stood at $3.87 billion RMD’s report also observed ing him to continue with the IMF- in December 2018. that Egypt has the most diver- backed economic reform program “We are now working very hard sified market in Africa, and the that has put the economy on the with the Ministry of Investment to “strides that have been made to road to recovery and laid the foun- really overcome any kind of prob- improve the investment and le- dation for strong and sustained lems facing the investors, whether gal business environment”. The growth that will improve living from the local or the international report’s findings are echoed by standards for all Egyptians. With market,” he adds. FDI Markets, affiliated to the the economic reforms and recov- Financial Times, which ranked ery luring many foreign investors Mega projects create 4 million Egypt first in Africa in terms of to enter the increasingly dynamic jobs foreign direct investment (FDI) and diversified Egyptian economy, President Abdel Fattah El-Sisi As part of the economic recov- flows with $7.4 billion. foreign direct investment is ex- swearing in Prime Minister ery, the El-Sisi government has “Reforms that took place over pected to grow significantly over Mostafa Kamal Madbouly in launched thousands of projects the last three years far exceeded the coming years. June, 2018. costing tens of billions of dollars our aspirations. For the first time, At the peak of the crisis in 2013- to overhaul Egypt’s poor infra- we are witnessing momentum 2014, Egypt’s growth was hover- 200,000 Egyptian families – the structure. Unlike the shorter-term and real political will to reform ing at under 3 percent, foreign poverty rate in Upper Egypt has fiscal problems, infrastructure is a the country,” says the Managing reserves had dropped to as little fallen for the first time, according decades-old issue that needed to Director at the American Cham- as $15 billion and unemployment to the prime minister. be addressed. ber of Commerce, Tarek Zakaria had jumped to almost 14 percent. “These social initiatives and pro- Some of the highlight projects Tawfik, referring to the recent leg- Since November 2016, and with grams are moving ahead and with that have been launched under El- islative changes that have enabled the help of a $12 billion IMF loan, the new government, our target Sisi’s government include: the $8.2 Egypt’s ascent to the top of the Egypt has taken bold measures – now is to really focus on the coun- billion extension of the Suez Canal; investor rankings. such as the devaluation of its cur- try’s human resources. We have the creation of the 285-square- rency, removing limits on foreign more than 65 percent of the popu- Apple CEO Tim Cook meets with Prime Minister Madbouly in Davos. mile Suez Canal Economic Zone ̸)RUWKHͤUVWWLPHZHDUH currency transfers, lifting hard lation below 40 years old, this is a (SCZone) set to become a hub for witnessing momentum and currency restrictions for importers, real challenge. The most important Creating a conducive environment Over the past four years, the logistics, manufacturing, ICT and cutting fuel subsidies and raising thing if you would like to make real for investment government has helped to steer petrochemicals; a $45-billion New real political will to reform value-added tax – that have truly positive contributions is to focus on As the government has pushed on the country in the right direc- Administrative Capital; a national the country” paid dividends. health issues and education.” with its economic reform agenda, it tion – implementing reforms roads projects; two new inter- “This country could have been led has also implemented measures to and laying down the plans for national airports; modernization TAREK ZAKARIA TAWFIK, MD, to disaster if we hadn’t made these “It’s our target in the coming make the country more conducive major infrastructure and other and extension of ports along the American Chamber of bold economic reforms. If we look period as a government to foreign direct investment (FDI) development projects that will SCZone; as well as several power at the numbers today, in the last to open more doors, make and private sector participation. ultimately allow the private sec- projects to meet growing electric- Commerce quarter, unemployment was at 8.9 In the fiscal year 2017-18, FDI tor to take the driving seat on the ity demand, including the world’s Besides its status as the top percent, down from almost 14 per- it more conducive and rose by 14.5 percent to $7.9 billion, road to Vision 2030 and beyond. largest solar park. It is safe to say FDI destination in Africa, Egypt cent. The foreign currency reserves flexible for the private sector, compared to the previous period. The government has also set out that there are very few countries in is also now the second-largest re- are now about 44 billion U.S. dol- whether from inside or But to ensure the success of the a plan to support the creation of the world witnessing development cipient of direct U.S. investments lars,” says Egypt’s Prime Minister, outside the country, to play Vision 2030 plan – which envi- a thriving SME sector, which in- on this scale. in the Middle East, trailing only Dr. Mostafa Kamal Madbouly. sions a competitive, balanced and cludes programs such as expand- “According to our calculation, the UAE. The United States is “For economic growth this year, their planned and major role” diversified economy, dependent on ing micro-financing for women these mega projects have man- among the top 10 countries with we are targeting 5.6 percent and innovation and knowledge – and in rural areas to create 100,000 aged to generate around 4 mil- direct investments in Egypt, re- for the next year we’ll be work- DR. MOSTAFA KAMAL the completion of the plethora of jobs and the Central Bank of lion new job opportunities. We cording $2.6 billion at the end of ing very hard to reach 6 percent. MADBOULY, planned mega projects, Egypt will Egypt’s SME-financing initia- have dramatically and substan- July, 2018. I think this is quite outstanding. Prime Minister of Egypt have to secure much higher levels tive that has compelled banks tially improved the infrastruc- Oil and gas producer Apache I’ve seen a lot of reports show- of foreign investment in the com- to expand their SME lending to ture, roads, water, sanitation, Corporation is the largest U.S. in- ing that Egypt was among the ing years. 20 percent of their portfolios. gas and electricity. We’ve also vestor in Egypt and is set to make top five growing countries in the One of the highlight initiatives While measures such as the Through all of the SME-focused managed to lower the deficit of an investment of $1 billion in new world. So, in terms of the econo- in the health sector is the pro- new investment law, the cut- initiatives, the government housing and other services. We wells in Egypt’s Western Desert. my, things are moving on and we gram to eradicate hepatitis C ting of red tape and financial wants to raise the SME sector’s have paved the way for horizon- Expressing his admiration for are very determined to continue in Egypt, which has one of the incentives are crucial to attract- share of GDP by 25 percent. tal expansion on desert land,” the Egypt’s economic decisions over our economic reform program in highest rates of the disease in ing more foreign investors (see “Even if you look at the new fis- prime minister proudly explains. the past three years, and the the coming years.” the world. The program aims to more on page three), the prime cal budget that we’re introducing “This was another challenge petroleum sector in particular, screen 60 million Egyptians for minister also points out the im- to the parliament, the contribution that Egypt has faced in the last David Chi, Vice President and The real impact on society hepatitis C and treat those who portance of overhauling the deep- of the private sector in the overall three or four decades. Targets General Manager of Apache At the beginning of the implemen- test positive free of charge. rooted mindset in the lower tiers budget and investment is almost have been achieved by these Egypt and board member of tation of the reform program, Presi- Another important society-based of government that still adhere to around 78 percent. The whole mega projects. We now have a AMCHAM Egypt, says that the dent El-Sisi had asked the Egyptian initiative is the enhancement of the the traditional modus operandi. role of the government is about good base for the contribution government’s clear vision and people to be patient, as the impact role of women and young people in “Some in the lower tiers of gov- 20 percent maximum, which will of the private sector, which can “bold decisions” have moved it of these tough measures was going the government and economy. For ernment are still looking back to the continue in terms of infrastructure make use of all these facilities in the right direction, encourag- to take time to trickle down to a the first time in the nation’s history, historical eras, always looking at and paving the way for private that we have introduced to ing more investments. societal level. But thanks to a very a quarter of the cabinet is made up any new measures with suspicion sector contribution,” explains the boost the economy. This is our “We are the biggest American strong social program that has by women who currently occupy and fear to implement them on the prime minister. belief: that without these kinds investor, so we have become this run alongside the reform agenda, eight ministerial posts, while the ground,” says Dr. Madbouly. The most important thing right of programs, the Egyptian econ- bridge between these two na- Egyptians, particularly at the lower prime minister also points out that “So it’s our target in the coming now, Dr. Madbouly believes, is im- omy wouldn’t have survived.” tions. I’m proud to not only be echelons of society in Upper Egypt, the prominence of women in busi- period as a government to open taking a lot of value out of the are now feeling the impact. ness is also rising. more doors, make it more condu- country, but creating even more As a result of the economic re- “We are now showing the ten- cive and flexible for the private sec- Produced by The Worldfolio: Editorial Director: Alvaro Llaryora. value for this country than we forms and social program – such dency on relying more on women tor, whether from inside or outside Project Director: Monica Perez-Ilzarbe. Design: Ruben Salgueiros. put in. We are a great partner as the introduction of food subsi- and youth, because we do believe the country, to play their planned Production Coordinator: Wael Atef Ismail. Contributing writers: for Egypt, and Egypt has been a dies, Takaful financial aid, and a they have their major contribution and major role in the contribution Aled Bryon, Helen Watson, Jonathan Meaney. fantastic partner for us.” social housing program targeting to make for the country,” he says. to the growth of the economy.” 02 SUNDAY, APRIL 14, 2019 The Worldfolio PUBLIC POLICY Closer than ever: the strategic partnership between Egypt and the United States continues to unfold Forty years on from the signing of the Camp David Accords, Egyptian Foreign Minister Sameh Shoukry sheds light on the dynamics behind the evolving strategic partnership EHWZHHQ(J\SWDQGWKH8QLWHG6WDWHVb Egypt and the United States Middle East and beyond has that “Egypt has made substantial economic sector at higher levels. have been rewarded quite hand- “The Suez Canal corridor pro- share a long history of mutual gained further credibility due to progress as evident in the suc- It has been beneficial, to both somely by their operations in vides for American companies interests, with the strategic its achievements at home. It has cess achieved in macroeconomic Egypt and the United States, Egypt … President El-Sisi has also a base to expand production economic, political and security been just over two years since the stabilization. Its growth rate is therefore they continue to ex- always shown a high degree of lines and to take advantage of partnership between the two country signed a $12.4 billion deal now among the highest in the plore advantageous avenues,” receptivity in meeting with inter- the free trade arrangements countries now stronger than ever. with the International Monetary region, the budget deficit is on a clarifies Minister Shoukry. ested American companies, and that Egypt has with the Arab Few bilateral relationships Fund (IMF), putting into place declining trajectory, and inflation Indeed, even before the re- in highlighting the opportunities world and also with Africa. The have deeper roots than those initiatives such as the liberaliza- is on track to reach the Central forms, Egypt has long been a that exist in Egypt; the invest- Continental Free Trade Area between Washington and Cairo. tion of the currency, restructuring Bank of Egypt’s target by the preferred destination in the ment opportunities,” Minister (CFTA) is another additional With spheres of interest across of energy subsidies and austerity end of 2019. Unemployment has region for U.S. commercial in- Shoukry explains, adding that element that can be attractive Africa, the Middle East and even measures to rebalance the budget declined to around 10 percent, terests. American foreign direct “with the current discoveries of to U.S. companies to be based beyond, Egypt has proved an in- and thus the economy. which is the lowest since 2011, investment (FDI) in the country huge gas reserves [in the Zohr in Egypt and expand into Af- dispensable partner for the U.S. rica. All components of a solid in the Middle East, most notably Egypt-U.S. relationship are on in the global fight against ter- track to mutually benefit both ror and extremism, a fact which sides,” notes Minister Shoukry. has not gone unrecognized by the Trump Administration. Just last “Major American companies September during the UN Gener- are heavily invested in Egypt al Assembly, U.S. President Don- and have been here over ald Trump described the role of President El-Sisi as “outstanding” the last 40 or 50 years, and in confronting the global menace, in general, they have been putting Egypt “at the forefront” rewarded quite handsomely in an ongoing battle. by their operations in Egypt” This came shortly after U.S. Secretary of State Mike Pompeo This tight regional integra- authorized the release of military tion will come into sharper aid to Egypt to boost its defense focus this year, as the country and security capabilities in the assumed the leadership of the region in order to bolster national African Union. In his keynote and regional security, calling the speech as he took the helm of U.S.-Egypt relationship “one of the bloc, President El-Sisi un- our deepest and broadest part- derscored the need for greater nerships in the region.” regional integration, economic ties and investment within the “Our economic relationship continent, calling for the CFTA with the U.S. is supported to be put to its full use. and enhanced by our strong Meanwhile, the Trump Adminis- tration recently unveiled its Africa political ties today, and the strategy as yet another opportu- mutual desire is to continue nity for Egypt to shine as both a cooperation in the economic Egypt’s Minister of Foreign Affairs Sameh Shoukry (right) meets U.S. Secretary of State Mike Pompeo in January, 2019. trusted partner and a core eco- sector at higher levels” nomic and socio-political power While these reforms have and social protection measures stood at $22.2 billion as of the offshore field], Egypt can be an hub. The strategy’s aims, which caused hardships, they have have been expanded.” financial year 2016-17, equiva- energy hub for the eastern Medi- include enhancing U.S. trade and SAMEH SHOUKRY, been at the same time, regarded Egypt remains a steadfast lent to a staggering 38.6 per- terranean, Europe and beyond.” commercial ties with African na- Foreign Minister of Egypt as necessary to the reform of emerging market; its name is no cent of the U.S.’ total FDI in Af- Commerce is tightly bound tions through arrangements that the economy. “The stability of longer synonymous with risk for rica. Meanwhile, in the Middle into Egypt’s DNA, with a trading benefit both sides, and countering Sameh Shoukry, Egypt’s Foreign Egypt itself has been demon- U.S. and global investors. The an- East, Egypt comes only second history that spans over five mil- the threat of terrorism, play to Minister, explains: “The conflicts strated by what it steadily en- nual Gallup Global Law and Or- to the United Arab Emirates. lennia. For American investors, Egypt’s strengths, while U.S. com- that exist in Syria, Yemen, Libya dured and accomplished in the der poll, published in June 2018, Today, the government sees at- the country represents not only panies, which already have a base and the threats and dangers of last few years, particularly in ranked the country 16th out of tracting as much as $11 billion a 100-million strong domestic in the country, will increasingly be terrorism are all challenges that terms of regaining the compe- 135 countries in terms of safety, in FDI in the current financial market, but also a hub through able to use it as a springboard into we deal with through coordina- tence of the institutions of gov- making it the safest country in year – up from $7.9 billion last which they can access major the rest of the continent. tion and cooperation with the ernment and their responsibility Africa and even safer than the year and a clear sign of grow- markets without tariffs as a re- “We have very special things United States. We share com- towards the Egyptian people,” U.S., which ranked 35th. ing investor confidence in the sult of a number of preferential happening, our relationship has mon interests when it comes to says Minister Shoukry. “Our economic relationship recovering Egyptian economy. trade agreements with the Arab never been stronger, we are maintaining peace and security Just last January, IMF man- with the U.S. is supported and “Major American companies countries, the EU, Turkey, and the working with Egypt on many dif- in the region.” aging director Christine Lagarde enhanced by our strong political are heavily invested in Egypt and COMESA, SADC, and the EAC ferent fronts including military Egypt’s strength as a long- heralded the country’s progress ties today, and the mutual desire have been here over the last 40 blocks, which together comprise and trade,” President Trump re- standing arbiter of peace in the on the economic front, noting is to continue cooperation in the or 50 years, and in general, they 26 African countries. cently said. Vision 2030 sets out inclusive vision of the future Egypt Incorporating the economic, social and environmental dimensions of sustainable development, Egypt’s Vision 2030 puts forward a strategy to achieve inclusive growth that promotes a balance between all segments of society.

“Egypt’s Strategy for Sustain- future, the ministry has been at able Development,” says Egypt’s pains to include a cross-section Minister of Planning, Hala El of young people in the planning Said, “is the roadmap that will and execution of Vision 2030. shape the future to which the “We have a very big team of country’s citizens aspire.” young Egyptians working very Implemented in 2016, this closely with the ministry, discuss- national strategy, known com- ing all the targets and objectives monly as Vision 2030, aims to of the vision, its implementation harmonize the goals of govern- and its achievements.” ment with the outlooks of the When it comes to inclusive private sector, civil society, na- growth and greater opportuni- tional and international organi- ties for Egypt’s female popula- zations, experts and academics. tion, Minister El Said highlights “It is a very ambitious and that her role at the helm of such long-term plan,” explains Min- an important national ministry ister El Said, the woman in “We are very privileged is symbolic of the government’s charge of overseeing the strat- to have a president that commitment to achieving gen- egy. “It is our national version der equality. of the SDG. It is rooted in the believes very much in the “We are very privileged to concept of sustainable devel- capabilities and abilities of have a president that believes opment and seeks to improve Egyptian women. In fact, very much in the capabili- quality of life in Egypt today we have eight females in ties and abilities of Egyptian without prejudicing the rights women,” she says. “In fact, of future generations.” the ministry responsible we have eight females in the Incorporating the economic, for the core portfolio of ministry responsible for the social and environmental di- government, as well as 89 core portfolio of government, mensions of sustainable devel- as well as 89 female parlia- opment, Egypt’s Vision 2030 female parliamentarians. mentarians. “On a wider note, sets up various pillars beneath On a wider note, we want to we want to increase the rate each of the main policy areas. increase the rate of women of women in the workforce On the economic front, these in the workforce to 35 to 35 percent by 2030, espe- pillars include energy, innova- cially in leadership positions.” tion and scientific research, to- percent by 2030, especially In order to reach its short- gether with the transparency in leadership positions” term aim of 8 percent econom- and efficiency of governmen- ic growth within the next four tal institutions. Social devel- DR. HALA EL SAID, years, the minister says that one opment factors include social of main objectives of the govern- justice, education and training, Minister of Planning ment is increasing job offers in health and culture, while there objectives is inclusive growth, the employment market. are also pillars for environment stresses the minister: “Inclu- “Reaching 8 percent is quite and urban development. For- sive growth seeks to promote a feasible and achievable with eign policy, national security balance between the different the amount of investment that and domestic policy form the classes of society and the various the government and the pri- overarching schema for the regions of the country in order vate sector are putting into strategy and set the determi- to ensure that positive outcomes the country. However, we have nants of the pillars. reach all segments of society and 750,000 graduates every year “Each sets out strategic tar- all parts of the country.” that enter the labor market, so gets and performance indica- Inclusivity is not just about our major challenge resides in tors that identify the current class, but about gender and age providing enough positions for situation and the standards to too. “Vision 2030 is an inclusive those people.” be attained by 2020 and 2030,” strategy, and that means women To achieve this, and all of says Minister El Said. “They also and young people,” says Minister the goals outlined by Vision outline anticipated challenges El Said. 2030, the minister stresses and the programs and projects With 60 percent of the Egyp- that “more participation be- that will be carried out in order tian population now under the tween all parties and sectors to meet our goals.” age of 30, representing one of of society is required in order Absolutely central to these the country’s main assets and its to move forward.” The Worldfolio SUNDAY, APRIL 14, 2019 03 INVESTMENT Foreign investment on the rise amid improved business climate $QHZLQYHVWPHQWODZKDVSURYLGHGDSDUWLFXODUO\LPSRUWDQWODQGPDUNLQ(J\SW̵VELGWRERRVWWKHEXVLQHVVHQYLURQPHQWOHDGLQJWRLQFUHDVHGSULYDWHLQYHVWPHQWDQGLPSURYHGFRQͤGHQFH Following some difficult meas- “Improving the business ures taken to stabilize the economy, in the context of a environment with the complex global economic envi- aim of promoting a more ronment, Egypt’s recent package competitive and dynamic of reforms have been specifically economy was a key pillar aimed at revitalizing local and foreign investment and position- of the reforms and has ing the country as a business and significantly contributed trade gateway to the African to increased productivity continent, and the world. More than two years since the and employment start of the reform program, ana- generation” lysts argue that these actions – such as devaluing the Egyptian DR. SAHAR NASR, pound and slashing energy sub- Minister of Investment and sidies – are now showing gains. International Cooperation While the fiscal reforms and a weaker Egyptian pound have made it easier to do business, Gateway to Africa the drive to open up the private Besides being home to 100 mil- sector to foreign investment has lion consumers of its own, Egypt included the passing of other also aims to become a gateway crucial legislative and institu- to Africa and the Middle East, tional reforms, ranging from a positioning itself as a technology, new investment law to the cut- energy, manufacturing and trade ting of red tape. As a result, the hub in the region. Egyptian government is today re- President Abdel Fattah El-Sisi (far right) and Minister of Investment Dr. Sahar Nasr (far left) at the inauguration of the Investor Services Center. “Our objective is to contin- porting a spike in new companies ue supporting the continent’s coming to its shores, as well as fied in May 2017, has provided a “It is very important to note cluding the Leasing and Factor- according to the World Invest- transformation into a global an expansion of existing ones, particularly important landmark that while FDIs globally ing Law, is continuing to boost ment Trends report of the United economic powerhouse by re- and a rise in foreign investment. in Egypt’s bid to improve the private sector participation Nations Conference on Trade and sponsibly capturing the full business climate. With an aim to have been on a downward through SMEs,” explains Min- Development (UNCTAD). potential of its resources and Tax incentives modernize and reduce barriers trend, Egypt’s share of ister Nasr. “We are committed “In addition, it is very impor- capabilities,” says Minister “Our economic reform measures to how international companies global FDIs is increasing, to working full force to increase tant to note that while FDIs Nasr. “Egypt strongly believes were indeed bold and ambi- invest and operate in Egypt, it access to finance to smaller com- globally have been on a down- in facilitating the movement of tious—and are paying off, set- looks to facilitate economic which is a positive signal panies, as well as provide them ward trend, Egypt’s share of capital, labor and goods and ting the economy on the right growth, domestic production, that we are on the right with the technical assistance global FDIs is increasing, which fostering pan-African invest- track to achieve inclusive and exports and foreign investment, track and that our reforms they need to operate more ef- is a positive signal that we are ments, while building stronger sustainable growth,” explains and is designed to boost employ- are bearing fruit” fectively and grow.” on the right track and that our and more mutually-beneficial the Minister of Investment, Dr. ment opportunities and increase reforms are bearing fruit,” says partnerships. Sahar Nasr. “The Government Egypt’s competitive edge across subsequently boosted economic Strengthened relationships Minister Nasr. “We’re already “I strongly believe that the achieved progress on fiscal the region. The law is also helping growth,” the minister affirms. On the foreign investment front, achieving promising results, African Continental Free Trade consolidation efforts, eliminated to improve equality of opportu- Consequently, companies in bold policy reform, political sta- signing investment agreements Agreement is creating oppor- foreign exchange distortions, en- nity, empowering youth, protect- Egypt are now able to establish bility, and a resilient economy are worth almost $2 billion during tunities for producers to ac- couraged domestic and foreign ing the environment and public themselves faster and more ef- also helping to build trust and the Africa 2018 Forum.” cess a wider market and, by investment, and increased the health, and enhancing good gov- ficiently, while small businesses strengthen mutually-beneficial Egypt’s economy, particularly reducing costs and barriers to private sector contribution to ernance and transparency. have increased access to low- relationships with its interna- in light of the improved business trade, creating a more com- growth and job creation.” cost debt. Meanwhile, the coun- tional business partners, with environment, offers ample op- petitive landscape that will “Improving the business envi- Investments in key sectors try is seeing the formation of Egypt maintaining its position portunities to foreign investors drive nations toward further ronment with the aim of promot- In order to specifically attract public private partnerships and as the leading destination for in a variety of sectors. Inter- economic diversification.” ing a more competitive and dy- more global capital to Egypt, a large private sector investments foreign direct investment (FDI) national businesses can part- “Africa, with a GDP of $3.5 namic economy was a key pillar number of new safeguards and in mega-projects, including the in Africa last year. ner with the government on trillion and 1.2 billion consum- of these reforms and has signifi- incentives were written into the energy sector, new cities such as Egypt witnessed the highest urban development projects in ers, will witness 50-percent cantly contributed to increased law, including certain guarantees the New Administrative Capital, percentage of foreign direct invest- mega-projects, including but not trade growth under the AfCFTA, productivity and employment of residency and tax exemptions and in developing public services. ment flows in Africa during 2018, limited to the construction, IT, as per the UN Economic Com- generation,” the Minister says. for foreign investors. Public-private sector collabo- accounting for 19.8 percent of to- healthcare and education sec- mission on Africa, and Egypt “This entailed comprehensive leg- “Alongside the investment ration in Alamein, Galala, the tal foreign investments. The value tors, while its Investment and is committed to playing a piv- islative reforms, ranging from a law, this full-fledged parcel of Suez Canal Economic Zone and of foreign investments received Economic Zones are also of note- otal role in this development,” new Investment Law, and Factor- reforms, which entails an attrac- the New Administrative Capital in Egypt increased by 7 percent worthy importance, leveraging stresses the minister. ing and Leasing Law, to amending tive package of incentives and have accelerated the develop- during 2018 to reach $7.9 billion, on enabling infrastructure and “Today, Egypt has invested the Companies Law and Capital guarantees, has led to a marked ment of these regions particu- compared to $7.4 billion dollars in strong incentives within the almost $10.2 billion across Af- Markets Law, and introducing, improvement in investor con- larly, and supported the govern- 2017. Most of the investments in investment law, and aiming to rica, and our regional agree- for the first time, a Bankruptcy fidence, which has translated ment’s urban development plan. 2018 have been concentrated in drive strategic sectors, such as ments serve as a powerful and Insolvency Law.” into increased investments in “In addition, legislative reform the real estate, food, oil and gas ICT, renewable energy, and qual- catalyst to further encourage The new investment law, rati- key sectors and regions, and to promote financial inclusion, in- and renewable energy sectors, ity public services. such investments.” 04 SUNDAY, APRIL 14, 2019 The Worldfolio PRIVATE SECTOR ENGAGEMENT Private sector called to f ill $230 billion investment Sustainable investment gap to meet infrastructure needs in renewable energy Recent measures aimed at “The government has to With Egypt’s goal to generate 42 percent of its energy capacity improving the business cli- open this space for the from renewables by 2035, private investors have prime mate, particularly focused private sector and invest opportunities to reap the huge potential in solar and wind. on fostering private sector in the future. PPPs are the Regionally, energy demand is expect- nance Corporation assigned $660 participation in sustainable most important approach ed to increase three-fold by 2050, million in funding to 13 FiT projects development, include tax in- presenting MENA governments in Benban with a total capacity centives of 30 to 50 percent to take now” with a concrete timeframe to push of 500 megawatts and The Euro- for investments in national ahead with renewable energy pro- pean Bank for Reconstruction and projects, with an emphasis AHMED EL SEWEDY, jects while phasing out fossil fuels. Development is planning to finance Egypt’s Integrated Sustainable 16 further solar projects in Egypt on areas most in need. President and CEO, Elsewedy Electric Group Energy Strategy is designed to tap with capacity of 750 megawatts. According to the World Bank’s 20 percent of the country’s electricity Benban, a region considered the latest report on the Egyptian needs from renewables by 2022 and most ideal place on earth outside of economy, published in Decem- Elsewedy Electric Group. “And 42 percent by 2035, with solar the Chile for solar power production, is ber, a significant increase in for this, public-private partner- primary industry ripe for expansion in one of Infinity’s major projects and private infrastructure invest- ships are the future. The govern- one of the nations with the greatest a perfect example of the company’s ment is needed in Egypt to free ment has to open this space for potential in that field on the planet. commitment to improving the lives up public funds for improving the private sector and invest in Although total installed capacity of people in their areas of operation; education, health and social the future. PPPs are the most im- of renewables in Egypt currently many employees at the $2.8bn de- protection. portant approach to take now.” stands at 3.7 gigawatts, Mohamed velopment are local residents. In the report, the bank reaf- “Egypt is full of opportunities, Mansour, CEO and co-founder of In- “It’s part of our DNA,” says Mr. firms the need for a “shift” in especially when it comes to the finity Solar, which in 2014 qualified Mansour. “We got into the solar Egypt’s development model, energy sector,” highlights Mr. El for the Feed-in Tariff (FiT) program, business precisely for that reason. where the private sector plays “If we can generate Recent measures aimed at Sewedy, pointing to the renew- says there is vast potential for more. We don’t want to just make money; a “pivotal role” in attracting HPSOR\PHQWSURͤW improving the business climate, able energies tariff being imple- “We’re looking to get into wind we want to help our country in a substantial new investment particularly focused on foster- mented that is currently driving projects, and hopefully we’ll do that positive way. Not only are we reduc- across high potential economic and taxes, then these ing private sector participation investment into the sector. next year. We’re also looking to di- ing carbon but we employ and edu- sectors. investments are all that in sustainable development, in- Energy is also a key sector for versify where our plants are and to cate because our plants are not in The report also quoted a G20 the private sector could clude tax incentives of 30 to 50 Qalaa Holdings, a company that buy plants in the U.S. and Europe. We the middle of the city, they are in the global infrastructure outlook and should be making. We percent for investments in na- opportunistically invests in pro- are looking to develop further plants middle of the desert, where there are that says Egypt will require tional projects, with an emphasis jects that increase the efficiency in Africa through our network. Our very poor villages. And we see the $675 billion in investments should be creating shared on areas most in need. And these of energy utilization. target is to, hopefully, reach 10 giga- effect of our presence immediately.” over the next 20 years to meet value for ourselves and for are opportunities that both in- “These investment opportuni- watts of generation by 2030. That’s This viewpoint is shared by Mu- its infrastructure needs. While the country” ternational and domestic inves- ties wouldn’t have been possible a bit of a stretch, but if we manage hammad Al-Fouly, Executive Direc- the government is expected to tors are now welcoming with without the structural adjust- half of that it’s an achievement.” tor of the UN Global Compact Net- provide $445 billion in financ- open arms. ment approach program that the The International Renewable En- work Egypt. In addition to acting ing, this leaves an investment DR. AHMED HEIKAL, “If we can generate employ- government has taken,” stresses ergy Agency shares Mr. Mansour’s as an advisor to private industry as gap of around $230 billion for Chairman, Qalaa Holdings ment, profit, and taxes, then the Qalaa Holding founder. “Be- optimism. A recent report estimated Egypt strives to meet the Sustain- the private sector to fill. these investments are all that the cause once you remove subsidies, Egypt could potentially generate up able Development Goals laid out as In order to help plug this gap, adjustments, and the President private sector could and should people will be forced to utilize to 53 percent of its electricity from part of the Egypt 2030 initiative, the Egyptian government over should take a lot of credit for be making. We should be creat- resources in a much more effi- renewable sources by 2030, which Mr. Al-Fouly’s remit is to ensure that the past four years has under- these actions,” says Dr. Ahmed ing shared value for ourselves cient manner.” would shave $900 million annually the needs of the population are first taken significant structural and Heikal, Chairman and Founder and for the country,” stresses When it comes to PPPs, Dr. from the country’s energy bill. and foremost in the mindset of big legislative reform that have not at Qalaa Holdings, a leading Dr. Heikal, whose company’s in- Heikal says that “the challenge Meanwhile, the World Bank’s business. Indeed, rather than view- only stabilized the economy, but energy and infrastructure in- vestments in the core industries for the Egyptian government will Regulatory Indicators for Sustain- ing population growth as a negative, importantly made the business vestment company in Africa of energy and infrastructure are be finding private sector players able Energy ranks Egypt among the Mr. Al-Fouly espouses the benefits climate suitable to attracting and the Middle East. “That’s helping shape Egypt’s and the that are credible enough with the three fastest-improving countries of a well-educated next generation, more private capital. the first reason that Egypt is wider region’s future. right kind of experience to man- in the world in terms of regulatory pointing out that Egypt has taken Though tough structural re- currently doing relatively better One method identified to help age the high quantum of debt frameworks. The private sector great strides in that area as part of forms, including substantial than most countries. However, plug the $230 billion private in- [that many of the country’s large already accounts for over 70 per- the country’s reform program. subsidy cuts and the floating in the coming period it will be vestment gap in infrastructure, infrastructure projects will re- cent of investment in renewables “The late Secretary General Kofi of the Egyptian currency, have crucial for the Egyptian govern- and equally providing an impor- quire] on a non-recourse basis. and Mr. Mansour envisages huge Annan praised our structure and been necessary to create mac- ment to ensure that it is able to tant tool for the government This is a challenge, not only in developments on the horizon. made it clear from the very begin- ro-economic stability, addition- attract international, regional to appropriately allocate risks Egypt but across the African “Nationally, we’re talking about ning: the Global Compact is there al legislative reforms adopted and local capital.” and responsibilities associated continent as well.” generation capacities of around to give the global market a human by the government in turn have The Egyptian Government has with expanding the economy “However, the bottom line 25-26 gigawatts of wind, and an- face, and that is what we do,” says taken a particular focus on cre- indeed been busy on this front, and stimulating job creation, is is, the private sector has a sig- other 35-40 gigawatts of solar. So Mr. Al-Fouly. “We urged business ating an encouraging environ- with the Organization of Eco- that of Public-Private Partner- nificant role to play on multiple it’s a huge market. We have lots to stop operating selfishly and for- ment for the private sector to nomic Cooperation and Develop- ships (PPPs). fronts, and I think the govern- of empty land, lots of demand for getting their mandatory ethical re- participate in the sustainable ment (OECD) in January praising “I believe the role of the pri- ment recognizes that and wants electricity. If you come here with quirements. We stressed that those development process. Egypt’s recent promotion of the vate sector in infrastructure in- the private sector to step in and an open mindset then a lot of doors businesses that are primarily there “It is noteworthy what the private sector, as well as the vestments is paramount,” says play a leading role in the coun- open and things move a lot quicker to tender to the needs of humans Egyptian government has been country’s ambitious economic Ahmed El Sewedy, President try’s sustainable development,” than you might expect.” have to be ethically structured, ac- able to do in terms of structural reforms over the past four years. and Chief Executive Officer at concluded Dr. Heikal. In July 2018, the International Fi- countable, and responsible.”

Egypt Post leading Egypt’s digital transformation

www.egyptpost.org Digital Transformation Era E-Service Digital Self-services postal · Mobile application Customer ßQLFLDOVHUYLFHV · Marketplace t6PDUWSRVWRIßFH · QR Code payment ,GHQWLßFDWLRQ · Biometric · Onboarding KYC · Bill e-payment · Fingerprints · Parcel looker t7UDIßFßQHV · Finger veins · Cardless cash withdrawal · Zip code & locate us t)DFLDOLGHQWLßFDWLRQ & Deposit · Loyalty & rewards program · Remote queuing ticket · Shipment tracking application · Internet banking · Bio Metric ATM The Worldfolio SUNDAY, APRIL 14, 2019 05 BANKING AND FINANCE 0DFURHFRQRPLFVWDELOLW\ sets the Exporters primed to benefit from stage for sustainable growth newly expanded Suez Canal 7KUHH \HDUV DIWHU VLJQLQJ D 86 ELOOLRQ ORDQ SDFW ZLWK WKH ,0) (J\SW KDV HQDFWHG The development of the new Suez Canal Economic Zone and the Suez Canal, which “saw the key structural reforms, strengthening the business climate, attracting investment, and largest increase in income in history” at $600 million last year, is attracting tens of billions increasing employment. of dollars of investments and is set to turn Egypt into a global export hub. Tackling Egypt’s long-standing If the Nile is the lifeblood of ag- Egypt (EDBE). EDBE has estab- courted more South Korean in- structural challenges has kept fi- riculture in Egypt, the Suez Canal lished itself as the main funding vestment in infrastructure. nance minister Mohamed Maait has served as the heart of interna- source of export operations in the “Egypt is one of the countries extraordinarily busy in the months tional trade for the country for a country and holds a 70 percent where, as difficult as sometimes following his appointment in June century and a half, pumping trade stake in Export Credit Guarantee it is, once you get in and start 2018. But his efforts have begun to across the region and the globe. A of Egypt, a company that guaran- working, the margins are really bear fruit. Named African finance 120-mile stretch of water between tees and provides insurance and high,” notes Mrs. Soltan. “Slowly minister of the year by The Banker in Port Said and Suez, the Canal is factoring services to exporters. but surely, I think everything is January, his work in driving Egypt’s effectively the original Hyperloop, “When I joined a couple of years moving towards making Egypt ambitious program of economic re- slashing the distances container ago, we had around 250 clients; more attractive to foreign and form has seen him win plaudits from shipping needs to cover to access we are close to 500 clients now, local investors alike.” around the world, with good reason. the four corners of the planet. split almost evenly between large As Basil El-Baz, Chairman Today, Egypt’s hard-won macroeco- On January 2, 2019, the Ca- corporates and SMEs,” says Mrs. and CEO of petrochemical firm nomic stability is laying the founda- nal recorded the second-highest Mervat Soltan, Chairperson of Carbon Holdings, notes: “If the tions for future sustainable growth, single-day traffic statistics in EDBE. “As a bank, strategically, world was flat, Egypt would be attracting investment and providing history, with 5.1 million tons of we are trying to grow our base of in the middle. It is one of the ever-increasing employment oppor- goods transported along the exporters. We are trying to help few places globally where you tunities for the country’s rapidly- waterway. In 2017-18 revenues those who export 10-20 percent can service north, south, east, growing population. Dr. Mohamed Maait was named African finance minister of the year from the Canal had increased to export more and those who do and west competitively.” In February this year, the execu- by The Banker in January. by $600 million over the previ- not export to understand the ben- Carbon Holdings is building the tive board of the International Mon- ous year, which Suez Canal Ad- efits. We have a strategy to help Middle East’s largest petrochemi- etary Fund (IMF) carried out its ̸)RUWKHͤUVWWLPHLQ But this progress has not been ministration President, Mohab boost exports anywhere. We’ve cal plant – a circa $11 billion in- fourth review of the North African without its difficulties. Reducing Mamish noted, was the “largest done a bit of restructuring and vestment at the SCZone which nation’s economic reform program, years, we have moved from the country’s debt burden remains increase in income in history.” we’re establishing a new group falls in line with nation’s plan to and praised its progress. “Egypt’s DSULPDU\GHͤFLWWRDSULPDU\ a key target. “We have challenges. Mr. Mamish also added that that should start working very become a hub for downstream macroeconomic outlook remains fa- surplus of 0.2 percent last Our debt on 30 June 2017 reached revenues are forecast to double soon, like an international banking petroleum industries. By build- vorable, supported by strong policy year and 2 percent this year. 108 percent of our GDP, which was by 2023, proving that the Egyp- group. We partnered with banks ing a hub for petrochemicals and implementation. Robust growth and very dangerous. Our debt service tian government’s sweeping re- like Afrexim and the African De- its derivatives, such as plastics, a narrowing of the current account This is continuing to improve, was more than 55 percent of our form program has nowhere been velopment Bank. We also have a Egypt can create the eco system deficit reflect a rebound in tourism GHFUHDVLQJWKHRYHUDOOGHͤFLW expenditure,” says Minister Maait. more effective at turning water to create a thriving manufactur- and strong remittances, while unem- IURPSHUFHQWWR “What we did was we finally re- into dime. “At almost two-thirds ing sector, which would feed off ployment has declined to its lowest percent, and next year we duced it 92.8 percent this year and The opening of The Suez Canal the size of Singapore petrochemical producers such as level since 2011,” said David Lipton, 89.2 percent next year.” Economic Zone (SCZone), com- DQGVHUYLFLQJELOOLRQ Carbon Holdings. first deputy managing director of expect it to be 7 percent” The government has been able to plemented by the 2015 Suez “The company that is going to the IMF, who also underscored the do this, in part, after implementing a Canal Extension Project, has consumers worldwide, manufacture plastic coat hang- country’s stringent monetary policy DR. MOHAMED MAAIT, value-added tax (VAT) regime which already paid dividends, contrib- the potential for the ers on a world-scale basis is go- stance, which has kept inflation under Minister of Finance has substantially increased tax reve- uting to over $15 billion in rev- SCZone’s growth is ing to do very well in the SCZone. control despite temporary increases nues, alongside a reduction in energy enues between 2015 and 2018, almost off the scale” The company that makes plastic in global food and energy prices. With this growth and stability subsidies which has shored up the the most recent figures avail- pipes for plumbing is also going “Our inflation decreased from comes renewed investor confidence. country’s financial situation. able. At almost two-thirds the good network of correspondence to do very well. In Egypt, there 33 percent in July 2017, having de- The Egyptian stock market is now Perhaps the most important out- size of Singapore and servicing across the world where we could are all the ingredients that would creased to 12 percent in December among the most profitable markets come of the government’s reform 1.8 billion consumers worldwide, actually help exporters reach any- allow, with a disciplined industri- 2018,” says Minister Maait, adding in the world, and the VanEck Vectors efforts has been the decrease in the potential for the SCZone’s where in the world.” al program, a manufacturing sec- that he expects to finish the current Egypt Index ETF, a U.S.-listed ETF unemployment from 13.3 percent growth is almost off the scale. The SCZone is one of the chief tor to emerge relatively quickly,” financial year, which runs to the end dedicated to Egyptian equities, is up to 8.9 percent. For a country with a Egypt’s main export destina- beneficiaries of the IMF’s $12bn says Mr. El-Baz. of June, with single-digit inflation. by nearly 20 percent year-to-date, vast youthful population, this metric tions are the United Arab Emir- development loan and the flota- “I believe we have put the legal For the minister, the numbers speak making it one of the best-perform- not only indicates economic stability, ates, Italy, Turkey and the United tion and subsequent devaluation framework in place to allow that. for themselves. “To assess the situa- ing single-country ETFs. As a result, but also contributes to the stabil- States and Germany. But the dy- of the Egyptian pound, coupled It is now a function of putting in tion we have to compare the coun- international ratings agencies are ity of society, as unemployed youth namics of its external trade could with the country’s industrializa- place production of the base raw try’s growth to three or four years beginning to lift their outlook on the in Egypt represent a key risk. With very well change with the estab- tion drive, has attracted several materials to allow those manu- ago, when GDP growth was around country’s debt. Most recently, Fitch unemployment figures now down to lishment of the African Free Trade lucrative foreign investment deals. facturers to say: ‘Yes, this makes 2 percent. This year, it is 5.6 percent Ratings upgraded Egypt’s long-term pre-revolution levels thanks to the Agreement, which is set to drasti- LG and Samsung are to in- sense. Let me manufacture this and next year it will be 6 percent,” he foreign-currency issuer default rat- economic recovery and an uptick cally increase traditionally weak crease investment in Egypt, with in Egypt’. Egypt is in a very fortu- says. “For the first time in 15-20 years, ing to B+ from B, with a stable in national development projects intra-African trade – opening up a the Vice-Chairman of the former, nate position because on one side we have moved from a primary deficit outlook. “Egypt has made further which provide jobs, the future is once market of 1.2 billion people, with Koo Bon-joon, noting: “LG Elec- there is a large trade deficit and to a primary surplus of 0.1 percent progress in implementing economic again bright for the people of Egypt. over $4 trillion in combined con- tronics in Egypt marked exports on the other a small manufactur- last year and 2 percent this year. This and fiscal reforms, which are driving As Minister Maait points out, sumer and business spending, to of $200 million during 2018, ing sector; it has a tremendous is continuing to improve, decreasing improved macroeconomic stability, “We are adopting policies aimed Egyptian exporters. which represents 75 percent opportunity. You’re dealing, effec- the overall deficit from 12.9 percent in fiscal consolidation and stronger at enhancing the living standards Helping Egyptian exporters to of the company’s production.” tively, with very attractive virgin FY 2012/13 to 8.4 percent, and next external finances,” Fitch clarified in of citizens and protecting the most reap the new opportunities is Egypt’s Minister of Investment, territory and I am excited by the year we expect it to be 7.2 percent.” a report. vulnerable groups.” the Export Development Bank of Sahar Nasr, recently successfully future of our country.” Banking sector embraces digitalization towards ͤQDQFLDOLQFOXVLRQDQG60(ͤQDQFLQJ %DQTXHGX&DLUHKDVHPEDUNHGRQDͤYH\HDUWUDQVIRUPDWLRQVWUDWHJ\WKDWLQFOXGHVUHJLRQDO H[SDQVLRQ VWUHQJWKHQLQJ LWV GLJLWDO SODWIRUP DQG ERRVWLQJ 60( ͤQDQFLQJ DQG ͤQDQFLDO inclusion. For more than six decades, Banque on our leading position, we have fore, aim to leverage on our pres- du Caire (BdC) has been the first developed a successful, well-con- ence in the UAE in order to open up port of call in the Egyptian finan- trolled model of servicing a profit- new opportunities for our top-tier cial services sector and today able microfinance customer base local corporates in Egypt who have plays a leading role in the na- and we continue to see this as a potential to export goods and ser- tion’s Vision 2030 plan – in part key segment going forward,” says vices to the UAE and the Gulf region. by pumping financing into SMEs Tarek Fayed, Chairman and CEO of The office also plays a pivotal role and micro-finance sectors, while Banque du Caire. in showcasing that Egypt is ready also remaining a key financier to With 222 branches and 7,500 for foreign direct investment from some of Egypt’s largest blue chip employees in Egypt, BdC is one of the region in light of the enhanced companies and infrastructure de- the oldest and most-respected fi- investment climate and significant velopment mega-projects. nancial institutions in the country regulatory improvements that are Following the appointment of and one with a clear vision of the now in place,” explains Mr. Fayed. Tarek Fayed as Chairman and direction in which the sector needs CEO in January 2018, BdC’s new to head to meet the demands of an ”With 222 branches and board approved a five-year strat- increasingly digital society. egy that includes expanding its “We are planning to offer our 7,500 employees in Egypt, domestic branch network and clients a well-diversified suite of BdC is one of the oldest regional presence, upgrading its products that will enrich their and most-respected infrastructure, enhancing digital banking experience, rolling out in- ͤQDQFLDOLQVWLWXWLRQVLQ services, promoting financial inclu- novative solutions in addition to sion and expanding its SME loan state-of-the-art technologies and the country and one with a and microfinance portfolios. digital platforms,” says Mr. Fayed. clear vision of the direction “At the heart of our strategy in which the sector needs “We are planning to offer our is a renewed focus on developing to head to meet the FOLHQWVDZHOOGLYHUVLͤHGVXLWH world-class, customer-centric value demands of an increasingly of products that will enrich propositions, transforming our ser- vice models by focusing on innova- digital society” their banking experience, tion and digitalization.” rolling out innovative In light of Egypt’s efforts to serve Another avenue for BdC is in fast- solutions in addition to state- a sizeable unbanked population, de- growing Africa, where it operates of-the-art technologies and spite widespread internet penetra- its subsidiary Cairo International tion and a booming mobile phone Bank in Uganda. Like BdC itself, its digital platforms” market, Mr. Fayed notes the sector Ugandan subsidiary has also under- is ripe for expansion: “The Egyptian gone restructuring overseen by a TAREK FAYED, banking sector is flush with liquid- new CEO and new board that have Chairman and CEO, ity and our strategy is to establish laid down a five-year strategy to Banque du Caire BdC as a fully-fledged universal strengthen BdC’s African network. bank that caters to clients’ needs “We aim to use our subsidiary in So far the adoption of the new and recognizes achievement while Uganda as a hub for opening new strategy is already paying off, with also building up value across every business opportunities in east Af- BdC achieving net profit of EGP 2.5 facet of our community.” rica, and to also improve the bank’s billion ($144 million) in 2018 versus As part of its financial inclusion position in the next three to five only EGP 800 million in 2017. In strategy to tap into and develop years to be among the top 10 banks 2018, BdC also achieved growth the unbanked population, BdC aims in the market,” says Mr. Fayed. rates of 105 percent in SME financ- to add 90 more branches across With the launch of its five-year ing and 97 percent in micro-financ- Egypt over the next three to five strategy, BdC’s transformation is ing, supporting the Central Bank’s years, as well as launching inter- well underway. But to ensure its target of having 20 percent of all net and mobile banking services, continued success in the medium lending directed towards those seg- enhancing mobile wallet services to long-term, the bank is planning ments by the end of 2019. Today, for its customers and expanding to go public, staging an IPO with Your Banking Destination microfinance and SME loans com- its ATM network. a free float of up to 49 percent of prise some 15 percent of BdC’s total Outside of Egypt, the bank also its shares on the stock exchange. loan portfolio. plans to expand its footprint in “We have to tap all business venues. “BdC is the microfinance leader the Gulf, where it has established So, we have very strong plans for and pioneer in Egypt, distinguish- a representative office in the UAE growth in the next phase and we 16990 ing itself from other commercial to serve the entire Gulf region. believe that the IPO will greatly banks in the market, with a market “Egypt has strong bilateral trade help us to achieve these objectives,” www.bdc.com.eg share of 25 percent. To capitalize with the Gulf counties. We, there- Mr. Fayed explains. 06 SUNDAY, APRIL 14, 2019 The Worldfolio EDUCATION How Egyptian banks are Harnessing the demographic dividend through education supporting national development With sweeping education reforms, Egypt’s enormous youth population will soon have the tools it needs to drive the With the largest banking sector in the region, Egypt is economy forward. now leveraging upon the wisdom of its banking sector to the government to students and buttress its ongoing development. teachers. Unveiling the new ap- proach during the National Youth When rating agency Moody’s Of course, in order for banks to be Conference, the country’s educa- announced recently that it had able to increase financial inclusion tion minister said that he believes upgraded its outlook for Egypt’s in the country, they require a con- that the new system will elimi- banking system to positive from ducive environment and favorable nate the phenomenon of cheat- stable, few were surprised. Bank regulatory environment, and Cen- ing and private tutoring, and will profitability has surged over recent tral Bank governor Tarek Amer has increase learning and creativity months, and total deposits are on a been at pains to provide one. By skills in students. steady upward trajectory, reaching putting into place rules which al- EGP 3.82 trillion ($220 billion) by lowed banks to reduce the level of “When I started all this effort the end of December 2018. mandatory reserves held with the 25 years ago, I said I wanted This strong performance from Central Bank by the amount lent to create a locomotive to the banking sector is providing the to SMEs, SME lending is now very foundations the country needs in profitable for lenders, providing a take Egypt forward” order to cement its progress and real incentive. reach its development aims. A key With an unbanked population HASSAN EL KALLA, objective for the government is the standing at 84 percent of the to- Chairman, Badr University activation of the private sector. tal, the opportunities for banks to “This is an economy that is now make a difference to the country The potential of Egypt’s educa- standing on its two feet after a few are enormous. Putting new financial tion sector is demonstrated by years of heavy, extremely daring tools such as savings, insurance and the interest shown by the private economic reforms,” Ferid Belhaj, credit facilities into the hands of its “Do you want real education or Egypt’s 22 million public school to create a two-tier education sector in investing in it. Cairo for World Bank vice-president for the 50-million-strong under-25 popula- do you want your kids to just students started studying an en- system, divided between those Investment & Real Estate Devel- Middle East and North Africa said tion will enable Egypt to fully capi- get ‘degrees’?” tirely new curriculum, as part of Vi- who can afford top schools and opment (CIRA) is Egypt’s most recently. “The economy’s standing, talize on the demographic dividend This hard-hitting message, de- sion 2030, an agenda focusing on those who cannot, Mr. El Kalla acknowledged investor in the area now it needs to walk, and we be- it has available to it as a result of its livered by President El Sisi at the economic, social, and environmen- has sought from the very begin- of education, serving over 14,000 lieve that the private sector is re- youthful populace. New initiatives, Sixth National Youth Congress, tal developments in the country. ning to make Badr University as students. Its managing director, ally the driver.” from microfinance to online bank- set the stage for the implemen- Empowering Egypt’s youth is affordable as possible. “While Mohamed El-Kalla, explains its at- In order to achieve this, the ing, are helping to bring the banking tation of Egypt’s new education key for its future development, we’re keen to provide quality edu- tractiveness. “The Egyptian mid- Central Bank has set an ambitious sector closer to young Egyptians. system, which aims to turn dec- and this new focus on education cation, cost containment is our dle class alone is larger than the target for the banks to boost SME Following the appointment of a ades of rote learning on its head will, the government hopes, al- religion. There’s always a way to population of three or four other lending to 20 percent of their total new board of directors in Septem- and bring in a new focus on tech- low them to take part in build- save money and still produce a Arab countries combined. We are loan portfolios by the end of 2020. ber 2017, the Egyptian Arab Land nology, in order to future-proof ing the future of their country quality product, and that’s what the first entity to provide blended But doing so involves rethinking the Bank is now positioning itself as Egypt’s vast human resources. by enabling them to qualify for we’ve been trying to do all the learning to the masses in Egypt, way banking is carried out in what a fully-fledged services bank ca- As recently as 30 years ago, skilled jobs. time since we started. We’re go- and the first entity that looks has been up until recently a very tering to retail, corporate, invest- Egypt represented the pinnacle While the government is a ing to contribute to Egypt’s pro- at the middle and lower-middle traditional sector. ment and its traditional area of of educational prowess in the re- key actor in promoting a better gress. After succeeding in show- class with specialized services.” The Egyptian Arab Land Bank, expertise of real estate financing. gion. Its doctors, teachers and education for Egyptian youth, ing that this model is working and The firm, which started invest- established in 1880, has embraced Mr. Kamal adds that the Egyptian engineers were a prized resource the private sector plays a vital replicable, we have then moved ing in schools in Cairo, has now innovation as it seeks to meet – or Arab Land Bank is currently in- in the Gulf and beyond, which led role. The founders of Badr Uni- to creating a bigger mass to be moved to other governorates. even exceed – the Central Bank’s vesting heavily in automation and to the Egyptian variant of Arabic versity, which opened its doors really able to impact education “We’re in Minya, we’re in Asyut, goal. “For me, banks as institutions technological upgrades. becoming the lingua franca of in 2014, have long worried about in Egypt.” we’re in Hurghada, we’re in Suez, are like big elephants. They move “We need to build up a very ef- the Arab world. But a failure to the divergence between the Another initiative underway we’re opening in Delta… We’re very slowly,” says Amr Fouad Ka- fective technology platform. This is modernize the system saw the knowledge and skills genuinely to reduce wealth-based inequali- seeing where Egypt is growing mal, the bank’s chairman. “Penetra- something that has been considered country fall behind. By 2018, it needed by the Egyptian economy ties in education in Egypt is the and we’re always there. We open tion is very low for banking SMEs by the Central Bank and the govern- ranked 129th globally in terms of versus the knowledge and skills scrapping of the Thanaweya schools in new cities before people because Egypt is a very wide ment, who are sponsoring this move the quality of its education. As possessed by university gradu- Amma. This standardized test start moving in, that means that country. This is a hard job for the to fintech,” says Mr. Kamal. President Sis pointed out during ates, and have sought, in the five – the secondary school leaving we are part of the story of why banks.” To overcome this challenge, The banking sector has surged his speech: the current system intervening years, to address certificate – determines entry people would like to move to a new the bank is looking at new ways in popularity, and is now emerging produces neither well educated this issue. “When I started all into university, and the high city, because the school is there.” of reaching underserved clients. as a viable investment opportunity nor highly skilled citizens, result- this effort 25 years ago, I said stakes involved have tradition- Egypt is already the third-most “NGOs are much more flexible in for foreign entities. With the Cen- ing in a mismatch between their I wanted to create a locomotive ally seen those families who can popular destination country for penetration and we have decided tral Bank of Egypt saying in March qualifications and market needs. to take Egypt forward,” explains afford to do so turning to pri- international degree students that we are going to lend money that it has received a flurry of re- This year, however, this is set Hassan El Kalla, the university’s vate lessons outside the school. within the Arab world, surpassed to them,” says Mr. Kamal. By lever- quests from major international to change. President El Sisi has chairman. “I need to see my The new education system will only by Saudi Arabia and the aging the network of NGOs in the banks for new licenses to operate declared 2019 the ‘year of edu- graduates everywhere occupy- switch to a grade point average United Arab Emirates, and nine country, the Egyptian Arab Land in the local market, the banking cation’, boosting public spend- ing leading positions to make (GPA) system, based on the three of its institutions were included Bank can extend its reach far be- sector will soon see further oppor- ing on the sector by 8 percent. Egypt the star it should be.” He years of study in that educational in the top 31 of the 2018 Times yond its branches. “I can see a lot tunities for transfers of expertise Today, Egypt’s education system adds that Egypt occupies a fun- stage, instead of the final year Higher Education ranking of uni- that can be done by banks. We are and sophisticated banking tech- is set to become a showcase for damental place in human history, in the current system. To ensure versities in the Arab world. As it taking those steps and the national nology, as it continues to support Egyptian renewal. and that its education standards transparency, it will be mainly overhauls its education system, it banks are also taking steps: it is the growth and development of At the beginning of the current should reflect this. based on technology, with tab- looks set to regain its position as coming,” adds Mr. Kamal. the Egypt of the future. academic year last September, Cognisant of the potential let devices being provided by the academic hub of the region. The Worldfolio SUNDAY, APRIL 14, 2019 07 TECHNOLOGY AND INNOVATION Postal provider ICT sector hits double-digit growth amid digital transformation becomes vibrant As the digital revolution transforms business, society and the global economy, Egypt’s growing ICT sector is laying the foundations for sustainable progress.

services and The Egyptian ICT sector is on a “We’re eager to sustain steady tick upwards, bringing ͤQDQFLDOKXE with it sweeping changes that are our contribution to GDP touching every sector. Tipped at 15 at 4 percent and then The barriers to e-commerce percent growth for the current fis- grow to 5 percent” are being eroded thanks to cal year, the government aims for the sector to contribute 5 percent DR. AMR TALAAT, Egypt Post, which is ena- to the country’s economy within bling online trade so that the next three years, up from 3.2 Minister of Communications Egypt can serve as a gate- percent in 2017, as it transforms and Information Technology way to Africa. Egypt into a digital economy. “The ICT sector grew by 14 per- phase. This includes notarization, re- cent in Q1 and 16.2 percent in Q2, newing driving licenses, and utilities which is an enhancement to what and electricity bills. Alongside that, has been realized in the past fiscal the government is technologically year,” says Amr Talaat, Minister of advancing its various agencies to Communications and Information provide better citizen services, while Technology. “We’re eager to sus- an aggressive plan is underway to tain our contribution to GDP at 4 integrate members of our society percent and then grow to 5 percent in the mainstream formal economy. and beyond in the coming years.” “We’re working in collaboration Remarkably, ICT investments in with the Central Bank of Egypt and the country soared by 38 percent other government entities to leap for- to $21.8bn in the 2017-2018 fiscal ward en route to financial inclusion,” year. The minister adds that the says the minister. “A unique initiative government plans to achieve this we’re working on is a unified card for by attracting ICT companies to citizens to receive all their govern- Essam Mohamed El Saghir, expand in Egypt and participate ment entitlements such as salaries, Chairman, Egypt Post in the implementation of Egypt’s pensions or subsidies. The card is digital transformation strategy. tied to either a bank or an Egypt Despite its 100 million-strong pop- Post account. When this initiative is ulation – three-fifths of whom are ”Our ability to attract foreign completed, 20 million citizens will be aged under 30 – and its 103-per- investments in ICT remains banked. We’re also working aggres- cent mobile phone penetration, the strong and we are aiming to sively on encouraging our citizens to e-commerce revolution sweeping use mobile money and mobile wallets the globe has yet to reach the banks strengthen it further. This and enrich the portfolio of services of the Nile. All this, though, is set ability stems from the young, offered. We’re collaborating with to change, and change is coming vital, vibrant, eager people young people across the continent the Central Bank of Egypt to offer from the unlikeliest of quarters: the ready to learn and make a to develop mobile applications and microfinancing through mobile appli- 154-year-old governmental postal digital games to meet the needs of cations. All these initiatives help in service provider. future for themselves” the Arab and African markets. moving towards a ‘less-cash’ society.” “We are redefining the role of It is interesting to shed light on The private sector has lauded Egypt Post,” says Dr. Amr Talaat, DR. AMR TALAAT, examples of companies with solid the government’s progress. Adel Minister of Communications and Minister of Communications investments in Egypt, such as: Uber, Hamed, CEO of Telecom Egypt, Information Technology. “We aim and Information Technology with its second largest center of says: “Digital technology has been to transform the Egyptian Postal excellence in Egypt; IBM’s six deliv- on the table since the early 2000s, Authority to become a services The Ministry of Communica- ery centers serving the entire globe; but people were talking about digi- and financial hub.” tions and Information Technology Dell Technologies center of excel- tal transformation of technological The barriers to e-commerce in (MCIT) recently signed MoUs with lence providing IT and business entities inside each organization. Egypt are twofold: the first, pro- a number of global technology process services in 14 languages; Today, the digital transformation hibitive shipping costs, and the innovators to develop the local and Microsoft Egypt’s Advanced is beyond that.” Notably, President second, a strongly cash-based skill base in order to support the Technology Lab (ATL) which works El Sisi has mandated the reform of society, which makes online country’s digital transformation on many exciting services and re- the education sector as a top na- payments difficult, explains Es- program currently being imple- search areas like speech processing, tional priority. Mr. Hamed shares sam Mohamed El Saghir, Chair- mented. A mindset shift is under- machine learning, and computer Telecom Egypt’s role as a major man of Egypt Post. To address way in Egypt, with plans to create vision, which contributed to build- contributor to the reform project, this, Egypt Post has agreed to 100,000 ICT job opportunities by ing Microsoft flagship products and extending fiber infrastructure to facilitate e-commerce through a 2022 in fields such as software de- cloud services. Additionally, Mentor 2,550 schools nationwide. consolidation hub at the postal velopment, cyber security, artificial Graphics’ R&D Center in Egypt is U.S., Europe and Asia. The world’s of choice to offer their global deliv- “The Egyptian market is extremely service’s logistical center at Cairo intelligence and blockchain. one of its biggest centers outside major subsea telecommunications ery services is on the rise. promising,” says Minister Talaat. “Our International Airport. While the impact upon Egypt’s USA; Vodafone has its center of cables run along the north coast Egypt is turning its sights to digi- ability to attract foreign investments Of course, logistical chal- GDP of this digital transformation is excellence for the Group’s artificial of the country, ensuring always-on tal transformation in order to drive in ICT remains strong and we are aim- lenges to e-commerce don’t just impressive, the government doesn’t intelligence and robotic process au- connectivity. The resource pool of forward its economy, starting with ing to strengthen it further. This ability affect Egyptians. Difficulties in want to stop there. Instead, it aims tomation (RPA) activities in Egypt; competitive labor stands out with government services. “This will stems from the young, vital, vibrant, receiving goods have led to the to position itself as Africa’s digital and Valeo Egypt has evolved to be its global competency standards create a collaborative environment eager people ready to learn and make e-commerce market across the hub. At the Cairo ICT Forum in No- Valeo’s main software R&D center, and competitive cost. Egypt poses among the government itself that a future for themselves. We’re looking whole African continent ac- vember last year, President Abdel providing all services in the field of a large English and French-speaking will contribute towards a more ac- to create an internationally compe- counting for less than 0.5 per- Fattah El-Sisi launched the Africa automotive embedded software. population, supported by other lan- tive and stronger ICT industry in tent talent pool of young technology cent of GDP, far below the global Games and Digital Applications Ini- In business process outsourcing guages including German, Italian, Egypt,” says Minister Talaat. savvy professionals specialized in ad- average of 4 percent. But Egypt tiative, which will see the creation (BPO), too, the country is rising in Spanish, Greek and Portuguese. To- The digital transformation pro- vanced technologies in order to ca- is well-placed to tackle this is- of 100 Egyptian-African start-ups prominence. Ideally situated in the day, the number of global technology gram includes offering up to 25 ter to the demand of ICT firms with sue. Mr. El Saghir, describes how and provide training for 10,000 GMT+2 time zone, it can serve the firms seeking Egypt as a destination digital public services in its first promising expansion plans.” he brought together his coun- terparts in a number of African countries to develop the Ecom@ Africa Initiative, positioning the Putting Egypt at the forefront of biotech for the region postal network as a key enabler Minapharm continues to venture into the future of biotech by investing in new facilities in Egypt and Berlin, opening the door for synergy projects to jointly develop and facilitator of e-commerce, and produce modern immunotherapies for Egypt, the MENA region and beyond. and enabling Egypt to become Africa’s e-commerce gateway. With over 50 years of experience next-generation medicines,” says Dr. Africa and the Middle East, special- Berlin to develop high-quality, yet “A big number of African coun- in producing the highest-quality Wafik Bardissi, Chairman and CEO ized in the research, development and cost-effective, genetically engineered tries signed with us and are now products based on cutting-edge re- of Minapharm. manufacturing of complex geneti- drugs,” explains Dr. Bardissi. using this facility, from the U.S. search and innovation, Minapharm By its part, the Egyptian govern- cally engineered proteins for unmet Enabled by its acquisition of Pro- to Cairo to African countries,” covers a broad spectrum of medi- ment has made efforts to facilitate medical needs. Taking a leap into cell BioGen AG, Minapharm has trans- says Mr. El Saghir. “We enabled cines, ranging from small molecules the growth of the pharmaceutical line engineering, Minapharm further formed from a regional technology e-commerce not just for Egypt, to extremely complex bioengineered industry, however, more attention consolidated its biotech business driven manufacturer of affordable but we’re now a huge gateway proteins. Key to Minapharm’s success needs to be given to address the ob- model in 2010 by acquiring ProBio- complex medicines to a global pro- for Africa as well.” Egypt Post and its regional leadership has been stacles to encourage local manufac- Gen AG, a Berlin-based internation- vider to the biotech industry at large. has now signed agreements with its strategic alliances with world turing of innovative products and to ally renowned contract development Minapharm continues to ven- several U.S. e-commerce plat- leaders at the forefront of pharma- develop strategies to accommodate and manufacturing organization and ture into the future of biotech by forms and marketplaces, includ- ceutical innovation. The cooperation the growing demand for biologics technology provider of biopharma- investing in two new facilities in ing Amazon, to open enormous with European and U.S. partners has versus the production of simple ceuticals. This business model al- Cairo and Berlin, enabling synergy opportunities in the Egyptian and enabled the transfer of technologies molecules. “For example, several lowed Minapharm to cover the full projects to jointly develop modern African markets. to provide locally manufactured prod- national health authorities across value chain from cell line to launch of immunotherapies for Egypt, the “The postal organization plays “While the focus in Egypt ucts in an affordable way, not only for the world have put in place regula- finished product, so patients in devel- MENA region and beyond. an evident role in the bigger pic- the Egyptian market but for other tions to encourage the use of inno- oping countries can also benefit from “It is, therefore, not unlikely to ture of the digital transforma- is still on small molecules, emerging countries. vative technologies for biosimilars the latest innovations. see Minapharm implementing a tion strategy and financial inclu- Minapharm was an early “While the focus in Egypt is still by authorizing tax incentives and “The establishment of a hybrid radically ongoing transformation of sion initiative of Egypt. Uniquely, recognizer of the shift in the on small molecules, Minapharm was subsidies,” says Dr. Bardissi. bioengineering R&D community of the global healthcare industry from Egypt Post enjoys the trust of health-care industry and an early recognizer of the shift in the As itself a leader in the region, Egyptian and German scientists al- traditional chemical compounds to the Egyptian people across all health-care industry and embarked Minapharm established its biotech lows us to constantly innovate, with today’s complex genetically engi- segments of society and has embarked on a transition on a transition towards large, com- subsidiary in 2003 in Cairo, the first synergistic projects driving tech- neered medicines and tomorrow’s a very wide footprint of more towards large, complex plex molecules ready to bridge to biopharmaceutical facility in Egypt, nology transfer between Cairo and ATMPs,” adds Dr. Bardissi. than 4,000 offices nationwide; molecules ready to bridge to possessing an extremely strong next-generation medicines” brand identity. Due to its simple interface, Egypt Post, therefore, is well positioned to serve as one DR. WAFIK BARDISSI of the main arms for providing Chairman and CEO, Minapharm digital and financial services for our citizens as part of the digi- Egypt remains one of the larg- tal inclusion initiative,” stresses est producers and consumers of Minister Talaat. pharmaceuticals in the Middle “The government is now work- East and Africa and aims to po- ing with the Egypt National sition itself as a leading provider Postal Organization to make of medicines to the region, despite microfinancing and other fintech the economic instability it has applications available to every witnessed following the currency citizen through a digital platform devaluation. The pharmaceutical as well as through digital offices, sector is seeing increasing atten- to allow people to buy and sell tion from investors and the grow- goods online,” says the minister, ing stability of businesses capable “We’re building an inclusive plat- of adjusting to the new economics form at ENPO to support small of a changing industry. manufacturers and artisans mar- With the shift towards complex ket their goods online.” molecules and advanced therapy All of this is part of the govern- medicinal products (ATMP) to ac- ment’s plan to double the number commodate unmet medical needs, of businesses selling products and Minapharm is leading a transition services online by 2020, making to high-value biologicals in devel- use of e-commerce to provide job oping markets. Aside from the opportunities, increase competi- production of life-saving and life- tiveness in the market, as well as enhancing medicines, the company raise business-to-business e-com- is adopting an international opera- merce volume from the current 0.5 tion platform for biotechnology and percent of GDP to 1.5-2 percent. cellular engineering. 08 SUNDAY, APRIL 14, 2019 The Worldfolio REAL ESTATE AND TOURISM Real demand and stable economic growth provide strong Egypt eyes sustainable fundamentals for real estate sector tourism growth An estimated 500,000 new homes need to be built every year to keep pace with the expanding population and to address the estimated backlog of 3 million housing units. Meanwhile, a new law that grants residency to foreign property buyers is expected to prompt a surge in demand from abroad. “The aim is to really change the narrative,” says Minster of Tour- Following the devaluation of the ing, but also providing a lower cost ism, Dr. Rania Al-Mashat, refer- Egyptian pound in November 2016, of living for residents through the ring to the political, economic real estate prices rose around 30 adoption of technology and innova- and security impacts that had percent year on year as citizens and tive building. in recent years severely ham- investors invested in property as a “We think our selling point in pered tourist numbers to one of means to keep their money safe. At Badya will not only be creative, the world’s most popular des- the same time the weakened pound innovative and high-tech knowl- tinations. However, with more also drew more foreign property edge, but it’s also the reduction than 11.5 million visitors to the buyers, which also contributed to of opex (operational expenditure) country in 2018 – a return to high price rises. using high technology. People were pre-revolution levels – it appears As the currency has stabilized, the always worried about the capex the recent sectoral reforms im- rate of growth of prices has fallen. (capital expenditure) to buy the plemented by the ministry are But despite the slowdown, the real unit. Now what’s becoming more already facilitating success. estate sector is still growing at a important is the upkeep of the unit. Yet creating sustainable tour- healthy 15 percent and is buoyed by With the removal of the subsidies ism – the central aim of the stable economic fundamentals and Egyptian property market is the mistic about the opportunities this Cairo’s west and east sides. in electricity, water and gas, life is reforms – is not just about in- real demand for housing that is not extremely low rate of mortgages, new law will bring about for Palm Aside from 30,000 residential becoming much more expensive,” creasing the number of tourists, going to let up. with many home buyers having to Hills, which has already seen its units, 16 percent of which will be explains Mr. Mansour. explains the minister, it’s about With Egypt’s population growing pay for their houses up front due portion of sales going to Egyptian standalone, Badya Creative City One highlight innovation that will “making sure that the local com- by 2.5 million a year, 500,000 hous- to the lack of mortgages on offer. expats jump from around 6 per- will also comprise of commercial, help to reduce opex is the city’s de- munities are part of the economic ing units need to be built annually This, Mr. Mansour says, acts as a cent to 18 percent following the retail, educational, leisure and medi- sign. Palm Hills purposefully con- spillover that tourism generates.” to meet current demand. A sizeable doubled-edge sword. currency devaluation. cal facilities. A beacon of health and structed the city in such a way that With one in every ten jobs in part of this demand can be attrib- “It works as a bad thing because “The new law which grants resi- sustainability, Badya promotes a the placement of the buildings cre- Egypt coming from the sector, uted to newly married couples that there’s such huge potential to be un- dency to foreigners is a huge thing ates a corridor of air that decreases the need to build capacity and still adhere to tradition. Even today, locked in the real estate market if we that will help us a lot. When I say “Egypt is a very unique the temperature by 2 to 3 degrees develop infrastructure have been modern newlyweds in Egypt will have an efficient mortgage system,” we will have new sales of 14 billion country in terms of real centigrade, which in turn will reduce identified as areas for achieving look to immediately buy a house or he says. “It’s good in the sense that this year: that is from the sale of HVWDWH,W̵VDFRXQWU\RI consumption of electricity to power sustainable growth. For this, the apartment rather than rent like their it works as a shock absorber in case around 3,400 to 3,500 units. I can million people. There is air conditioning. government is leaning heavily on counterparts in Europe and the U.S. of bad times. We’ve seen this with easily see us increasing this by 50 “We’ve also reduced the size of the private sector. “Egypt is a very unique country in the crises in 2008 and 2011 – one percent by going abroad and try- GHͤQLWHO\JHQXLQHGHPDQG the unit and improved engineering “The priority must be to con- terms of real estate. It’s a country was the international financial crisis ing to sell this residency program,” because of the number of to make it more efficient. We’ve tinue to build infrastructure,” of 103 million people. There is defi- and the other was Egypt specific. In says Mr. Mansour, who sees most marriages and people who done this with our intention to re- agrees Khaled Bichara, Group nitely genuine demand because of both cases, Egypt’s real estate mar- of the demand for permits coming want to move out of Cairo” duce people’s opex (their monthly CEO of Orascom Development, the number of marriages and peo- ket was extremely resilient.” from citizens from other countries payment) by up to 30 percent of a leading developer of fully in- ple who want to move out of Cairo, With a new law on residency per- in the Middle East and North Africa what they’re paying, which I think tegrated destinations in Egypt maybe moving to the west and east mits for foreign property owners, (MENA) region. YASSEEN MANSOUR, will help a lot of people to move and which include hotels, residential as Cairo doesn’t expand to the north there is expected to be a surge in Group CEO and Chairman, live comfortably in Badya.” units and leisure facilities. “That’s and south,” says Mr. Yasseen Man- demand from abroad that will also Badya Creative City Palm Hills Development Badya will also be one of the ME- why at Orascom Development, sour, Group CEO and Chairman of drive real estate sector growth, Set to become a hub for entrepre- NA’s smartest cities thanks to Palm we build whole towns! In every Palm Hills Development. alongside increasing demand from neurship, creativity, art, education healthy lifestyle – applying the ‘5- Hill’s collaboration with IBM, which town we build, there’s residen- “We’ve seen unbelievable de- Egyptian expats. A one-year residen- and healthy living, Badya City is Palm 10-15 urban walkabilty’ rule with aims to pioneer the notion of cognition tial, touristic, educational, and mand over the last few years. Our cy permit will be granted to buyers Hills’ flagship development. Situ- highly accessible pedestrian zones in a multitude of lifestyle solutions. the commercial component. Our sales two years ago totaled roughly of properties valued at $100,000; ated on 3,000 acres west of Cairo – and is the first city in the MENA As such, Badya will be the first truly most mature towns have their 8 billion Egyptian pounds ($460 while three-year and five-year per- and adjacent to 6th of October City, region to fully comply with the UN cognitive city in Africa, the Middle own hospitals, a university, even million). Last year it was 12.5 bil- mits will be offered to those who Badya’s location capitalizes on the Sustainability Goals. East and Europe, designed to attract its own football team and sta- lion and this year we’ll probably hit buy properties worth $200,000 new road, monorail and high-speed Another important goal for Palm the talented, tech-savvy and creative dium! It’s basically a complete close to 14 billion Egyptian pounds.” and $300,000 respectively. train networks that connect it with Hills with the Badya development class of young Egyptians that will help community.” Another unique feature of the Mr. Mansour is particularly opti- new points of interest and bridges was not only promoting healthy liv- to build the Egypt of tomorrow. “We can do all that our role asks of us, as a community devel- oper,” continues Mr. Bichara, “if Disrupting the Egyptian real estate market with unique integrated developments we have the right conditions in terms of airport services, roads, As Egypt looks to plug the huge demand gap in housing, Tatweer Misr has developed a unique project that will integrate housing, education facilities, a power infrastructure, and the university and start-up incubators that will become a hub for living, innovation and entrepreneurship. political will to promote Egypt as a safe destination – which Steadfast development of hous- fortunately, we now do.” ing, new cities and infrastructure Key tourism players like Oras- projects have made Egypt’s real com will not only look to govern- estate one of the most attractive ment to create these necessary investment segments for foreign conditions for growth, but other investors. With high population industries too, such as the trans- growth, around 500,000 new port sector. housing units are needed per year, Nile Air is Egypt’s largest leaving a huge demand gap to be private full-service carrier op- filled both by government social erating scheduled and charter housing schemes and private de- services from Cairo and Alex- velopers, who currently deliver andria to emerging airports in around 50-60,000 units annually. the region, giving international The real estate sector is poised and domestic visitors easy and to take off following the inau- comfortable access to many guration of 14 cities worth 22.5 destinations inside Egypt. billion dollars. It is projected that “Tourism is helping Egypt 700,000 units will be added in bring in foreign capital once 2020 by the Ministry of Housing, again. It’s very important for which also wants to engage the us,” says Nile Air CEO, Hassan private sector in the development Aziz, stressing that tourism cur- of social housing. rently represents a third of the With Egypt’s old towns and cities airline’s network. too congested and unable to han- “We have all the safety aspects dle more capacity, the construc- and quality, including IOSA ac- tion of liveable, breathable new creditation – a remarkable cer- urban centres has been deemed tificate to prove that the airline the way forward for the country, Two of Tatweer Misr’s developments: Fouka Bay and Bloomfields. is providing the highest safety which still has vast swathes of un- standards in the industry.” occupied land primed for devel- of the real estate sector and real will be connected with all GEN With tourism levels rising again opment. (Egyptians currently live estate developers.” networks around the world and to their highest in ten years, Nile on just 7 percent of the country’s This type of integrated devel- will enable young entrepreneurs Air is ramping up to support in- total land area). opment, incorporating schools, to present their ideas, get ad- dustry growth, says Mr. Aziz, universities and hospitals in vice and secure financing, etc.,” highlighting the two new routes “I think we developers new liveable spaces away from says. Dr. Shalaby. from Madrid and Paris to Luxor, should consider expanding congested old population cent- “The hub will host executive as well as a deal in the pipeline our work, especially now that ers, is something Tatweer Misr courses from different institu- with a German partner to link the is already doing at its Bloom- tions around the world, training Red Sea and North Coast of Egypt. the government is opening fields development located just courses and conferences. So, The airline is also adding another new cities everywhere in 15 minutes from the New Ad- it will act as the main value to two Airbus aircrafts in 2020, and the country. I also see the ministrative Capital. connect the schools, the univer- another in 2021, bringing its total opportunity for other types As Tatweer Misr has called it, sity, the surrounding residents in fleet to 10. However, the sky is the Bloomfields is “a breakthrough Bloomfields and the others to this From mountain to sea: IL Monte ties and lifestyle factors that we limit in the long term says Mr. Aziz, of real estate developments perspective on integrated living area – to make this area the cen- Galala and Fouka Bay will add to this amazing place.” with the sustainable development – not just housing, but offering new concept homes de- tre of life, innovation and science.” Aside from their ambitious Bloom- Tatweer Misr’s second project, of the communities it serves at the schools and universities and signed for every lifestyle, rang- fields project, Tatweer has two Fouka Bay on the North Coast, forefront of expansion plans. also hospitals” ing from one up to four-bedroom “We decided to have the other major developments target- consists of double-decked twin “I would like to grow the air- residences.” With education, sci- GEN hub in the heart of ing tourists, domestic and foreign houses and townhouses, stan- line to 20 aircrafts and add more ence and innovation at its heart, second-home buyers and Egyptians dalone chalets, spacious cabins destinations to Nile Air, which AHMED SHALABY, the 415-acre development will the university campus. on the higher-income scale. and bungalows – all of which are will be a huge success for the CEO and Managing Director, also comprise an entrepreneur- Through this hub we will Nestled in the mountains of Galala located facing the white sandy country. We are part of this Tatweer Misr ial university, a lively college have all GEN activities. It on the Red Sea coast, IL Monte beachfront along the stunning Ras country and we must contrib- town, internationally acclaimed Galala is Tatweer Misr’s first pro- El Hekma coastline – and like its ute to society. We train, educate, “Now we have the land, we schools, and is set to become will be connected with all ject, whose design was inspired by sister resort, includes a huge Crys- hire, and recruit the Egyptian have different projects, the Egypt’s hotbed for startups and GEN networks around the the blend of architectural sophisti- tal Lagoon making every home in people. We work in Egypt, so new administrative capital and entrepreneurs. world and will enable young cation and natural beauty found in the resort a waterfront home. must cater for them.” other new cities, I think that the Tatweer Misr has held talks with entrepreneurs to present the mountains of Portofino, Italy. At both IL Monte Galala and Amr Badr, Managing Director government spending in infra- a number of U.S. universities and Named ‘Best Project’ at the City- Fouka Bay, Tatweer Misr has part- at Abercrombie & Kent Egypt, a structure is just opening the way recently penned an agreement their ideas, get advice and scape Global Awards in 2016, IL nered with Kerten Hospitality to leading luxury travel company, for more investments to come with the New Jersey Institute VHFXUHͤQDQFLQJ̹ Monte Galala’s 2.2 million square build a total of seven boutique ho- agrees that the outlook for the in to the country,” says Ahmed of Technology (NJIT) and Ocean meters will offer residents and tels operated by the Cloud7 and Egyptian tourism is once again Shalaby, CEO and Managing Di- County College (OCC) in order to As one of Egypt’s most innova- visitors a unique lifestyle proposi- House brands, which will also of- “extremely positive”. rector of Tatweer Misr for Real establish Egypt’s first American tive and forward-thinking young tion, boasting luxury housing, hotels, fer serviced apartments, villas and “Tourism is growing phenom- Estate Development. International Branch Campus companies, Tatweer Misr wants serviced apartments, retail and lei- cabanas. The House Hotel Fouka enally,” he says.“The potential is “I think we developers should (IBC) at Bloomfields. to instill the ethos of innovation sure, office spaces, and the world’s will be the first of the seven to be great. Egypt is gifted by the fact consider expanding our work, es- This agreement follows the es- and entrepreneurship at “GEN@ first man-made Crystal Lagoon on launched in 2020. that it’s one of the few destinations pecially now that the government tablishment of another partner- Bloomfields”, at the university a mountain, which will include three “Between hotels and serviced in the world that is on everybody’s is opening new cities everywhere ship with Global Entrepreneurship campus and across the whole of kilometres of white sandy beaches. apartments, we will add about bucket list. Importantly, the coun- in the country. I also see the op- Network (GEN) to launch “GEN@ Bloomfields, in order to build a “In terms of location and natu- 2,400 keys both in Fouka and try is building the infrastructure to portunity for other types of real Bloomfields”, the first hub for in- thriving ecosystem for creativ- ral beauty and also proximity to IL Monte Galala,” Dr. Shalaby support this. To double our tourism estate developments – not just novation and entrepreneurship in ity and start-ups. As Dr. Shalaby Cairo, IL Monte Galala is the per- explains. “We believe in this di- numbers, we’ll have to build more housing, but schools and univer- the Middle East and North Africa points out, the next generation fect location,” says Dr. Shalaby. versification, we believe that we roads, more accommodation, air- sities and also hospitals. I think managed by GEN. of Egyptians will have to be job “Unfortunately, it is also a location should diversify our portfolio to ports, and the manpower capacity. this diversification in portfolio “We decided to have the GEN creators rather than job seek- where there are many houses and have typical residences, serviced Do we have today the readiness to between locations and products hub in the heart of the universi- ers and Tatweer Misr aims to beautiful vistas but very little life. apartments and hotel rooms, and do it? It’s a challenge – it’s buildup will be very helpful in the coming ty campus. Through this hub we support that landmark shift And here lies our vision to change I think there’s a huge opportunity of things that we need to do, but few years to sustain the growth will have all GEN activities. It at Bloomfields. this through the different activi- for that in Egypt.” we can do it.” The Worldfolio SUNDAY, APRIL 14, 2019 09 TOURISM Private sector investments in the hospitality sector to increase as a show RIFRQͤGHQFHLQ(J\SW̵VDSSHDODVDGD\GHVWLQDWLRQ Latif Group, in line with the widespread development of tourism-related infrastructure, is planning to add several properties to its portfolio in Egypt, which includes the award-winning Rixos Sharm el Sheikh and Rixos Premium Seagate.

Photo left: Latif Group’s multi-hotel project in Egypt; Photo center: Rixos Premium Seagate’ swim-up suites; Photo right: Alex Kyrakidis of Marriot International (left) and Nasser Abdel Latif (right) sign a contract management agreement for the Ritz Carlton Sharm el Sheikh.

With tourism forming a core part Established in 2000, Rixos existing properties in Sharm el described as the gem of the Red Following the great success of ism projects, as Alamein is a very of Egypt’s Vision 2030 plan, the Hotel Group has found success Sheikh and El Alamein. Sea, the Ritz Carlton is set to open its Sharm El-Sheikh properties, safe destination for investment.” government and stakeholders in offering traditional Turkish hos- In line with the widespread its doors in 2020 following a $600 the company opened Rixos El As it looks to increase its room the private sector are pushing to pitality coupled with a unique development of tourism-related million dollar investment. Aimed at Alamein in 2014 as the brand’s capacity from 2,000 to 15,000 market resorts such as Sharm el spa experience in the finest sur- infrastructure and resources to al- the affluent leisure tourism mar- iconic representation on northern rooms over the next five years, Sheikh on the Red Sea and the roundings and luxury ambience, low Egypt to accommodate more ket, the resort will comprise of 252 Egypt’s Mediterranean coast. Mr. Rixos expansion plans include Mediterranean coast’s El Alamein operating premium resorts and than 10 million tourists annually, rooms, including 12 villas, three Latif is particularly optimistic adding properties in Hurghada, as 365-day world-class lifestyle villas in Europe, the CIS coun- Rixos plans to increase its capacity restaurants, several pools, a spa, about the potential of El Alamein Magawish, Makadi Bay, Sahl destinations, poised to attract tries, North Africa and Middle from 2,000 to 15,000 rooms over a range of water sports activities, to become one of the world’s pre- Hasheesh, Marsa Alam and Cairo. families, business travelers and East. The hotel chain is reputed the next five years, and will focus as well as the one of the biggest mier destinations. “With 2,000 rooms already international events. for its hospitality, attentive per- its resources on niche tourism, shopping, entertainment and inter- under its portfolio, Latif Group sonalized service and fine cuisine luxury hospitality and attracting national restaurant complexes in “With the continued is moving forward to increase “With 2,000 rooms already and has received global recog- world events to its properties to Sharm El Sheikh. infrastructure developments the number of hotels and rooms under its portfolio, Latif nition and top ratings from the drive awareness of the destination In February, Rixos Sharm el and support from the throughout the country with Group is moving forward likes of the American Five Star and the brand internationally. Sheikh in Egypt ranked eighth in a concept that is continuously Diamond Award, Conde Nast, Having spotted the niche ap- the TripAdvisor’s ‘Top 25 All In- government, Alamein will perfected across Rixos Hotels in to increase the number of World Travel Awards and Great peal of Egypt’s up-and-coming clusive Resorts in the World’ list- very soon become a name Egypt,” says Mr. Latif. hotels and rooms throughout Hotels of the World. destinations, Rixos entered the ing. Meanwhile, Rixos Premium that resonates on the world “We are aiming to expand in the country with a concept “As Rixos we aim to create an country in 2011 with the launch Seagate was named ‘Best Hotel in tourism stage” Hurghada with two properties environment where our guests of Rixos Sharm El Sheikh, intro- Egypt’ and ‘Best Luxury Hotel’ in being unveiled in the end of 2019: that is continuously feel they are experiencing the ducing the pioneering ‘Ultra-all- Egypt, and won the fourth spot in Rixos Makadi Bay and Rixos perfected across Rixos true meaning of hospitality. The Inclusive’ and concept to the the ‘Best Hotel in the Middle East’ NASSER ABDEL LATIF, Magawish. Latif Group is plan- Hotels in Egypt” Rixos brand is very versatile in Egyptian market. category, making it one of the best Chairman and Founder, ning a construction of a 4,000 the implementation of new ideas Since then, the company has hotels in the Middle East. Rixos Latif Group key resort in Sharm El Sheikh that From ancient Egyptian heritage and concepts and that’s why we added two more five-star prop- has also won various awards from will feature four international and culture, to luxury hotels, spas can quickly adapt to our guests erties to its portfolio in Sharm el Top Hotels, Holiday Check and “We believe the Alamein area brand-name resorts, a congress and a protected coral reef that has needs,” says Nasser Abdel Latif, Sheikh; the Ritz Carlton and the received many distinctions from will be one of the leading tourism center, 40 serviced villas, enter- made it a world-renowned diving Chairman and founder of Latif Rixos Premium Seagate. Rixos global tour operators. The Turk- destinations. Seventy percent tainment and shopping complex, destination, Sharm el Sheikh truly Group. “Passion and attention Seagate offers 1,000 luxurious ish-inspired, Ultra-all-Inclusive of travelers’ worldwide travel a sports village, an aquaventure has it all. Famed for the decisive vic- to detail is something we value and elegantly decorated rooms, luxury resorts were awarded with during the summer/spring sea- park and a 20,000-square-meter, tory of the Allies in the WWII North and undertake from the planning suites and villas, a conference the highest TripAdvisor honors sons which are over six to seven state-of-the-art crystal lagoon. Africa campaign, El Alamein, mean- phase when building the proper- room and seven swimming pools, based on their distinct quality, ser- months a year, and Alamein, with We are also planning to expand while, has several historical sites, ties to when the guests check out and has its very own protected vice, value and overall experience one of the most beautiful coasts to other destinations with the glistening Mediterranean beaches of our hotels.” coral reef, designed to provide di- – which have led to the thousands in the world, is an attractive same strength.” and is the perfect base from which Buoyed by the prospect of rect access for divers and snorkel- of positive reviews these hotels destination,” he explains. “With Latif Group’s ambitious ex- to discover Egypt’s stunning North longer term investment, increas- ers from its very own jetty. have received from their guests. the continued infrastructure de- pansion plans throughout Egypt Coast. And one company that aims ing visitor numbers and a growing On the back of its outstanding Such international recognition for velopments and support from speak volumes about its belief to put El Alamein and Sharm el number of incoming international reputation, Latif Group signed a Rixos’ Sharm el Sheikh Hotels will the government, Alamein will in the country’s tourism po- Sheikh firmly on the global tourism flights, Latif Group is making in- management agreement to bring help boost the area’s global ap- very soon become a name that tential and its commitment to map is Latif Group, owner of Rixos vestments in Egypt, which include the Ritz-Carlton Sharm El-Sheikh peal as a world-class destination resonates on the world tourism supporting the development of Hotels, one of the world’s fastest- plans to add several new develop- Resort to the Sinai Peninsula in for luxury, leisure, business and stage. There is huge potential tourism in line with the goals growing luxury hotel chains. ments across the country to its 2016. Located in Sharks Bay, often conference tourism. for real estate, hotel and tour- of Vision 2030.