Egypt's Import Economy

B U S I N E www.amcham.org.eg/bmonthly S S NOT FOR SALE M O N T H L Y MARCH 2014 ALSO INSIDE: L L EGYPT GOES DIGITAL L L CAIRO’S INDIE FILM SCENE L L AMCHAM, EGYPT-U.S. BUSINESS COUNCIL JOINT MISSION TO WASHINGTON T H E C H I N A S Y N D R O M E M A R C H 2 0 1 4 Egypt's import economy M A RC H 2 0 1 4 VO LU M E 3 1 | I S S U E 3 Cover Story 24 Made in China Cairo is awash with cheap goods from Asia that are either imported through proper channels or smuggled in. But questions have been raised lately about whether these products are safe and reliable, while Egyptian factories struggle to stay afloat. Cover Design: Nessim N. Hanna Inside 12 8 Editor’s Note 10 Viewpoint The Newsroom 12 In Brief The news in a nutshell 16 Region Notes News from around the region © Copyright Business Monthly 2013. All rights reserved. No part of this magazine may be reproduced without the prior written consent of the editor. The opinions expressed in Business Monthly do not necessarily reflect the views of the American Chamber of Commerce in Egypt. 6 I Business Monthly – March 2014 M A RC H 2 0 1 4 VO LU M E 3 1 | I S S U E 3 18 40 42 Market Watch Executive Life 32 Stock Analysis 40 Dining Out Heat rises Spanish confusion 33 Capital Markets A glance at stocks & bonds 42 Food What's cooking? 35 Money & Banking Forex and deposits 36 Key Indicators The economy at a glance 37 Egypt-U.S. Trade In Depth Imports and exports The Chamber 18 Signals fuzzy as Egypt Corporate Clinic 37 AmCham, Egypt-U.S. counts down to digital Business Council 38 Technology The end of analog broadcasting joint mission Connected 21 Egypt’s independent movie 52 Events industry hits its stride A growing audience for art house 56 Member News films 58 Announcements 60 Media Lite An irreverent glance at the press 8 I Business Monthly – March 2014 Editor’s Note Director of Publications & Research HEAL Khaled F. Sewelam Editor-in-Chief Rachel Scheier Contributing Editor THYSELF Tamer Hafez resident in obstetrics and gynecology at Kasr el Aini, Egypt’s oldest and largest Staff Writer hospital, told me he became a doctor in order to serve his country. Now he just Mat Wolf wants to leave. Australia, Dubai—he’ll go anywhere he can earn a living wage. In recent weeks, doctors like him employed by Egypt’s public hospitals and Art Director clinics, which serve the vast majority of the population, have stepped up strikes demanding Nessim N. Hanna better pay and increased health care spending. Egyptian doctors are infamously underpaid, with fresh medical graduates earning as little as LE 200 a month. Many are forced to moon- Contributing Writers A Isabel Esterman light to the point of exhaustion or take bribes from patients in order to make ends meet. Brendan Meighan After seven years of medical school and eight as a resident, my doctor friend now earns LE 2,000 a month. He says: “Garbage collectors make more.” Photographers Last month, Egypt made international headlines when Army officials claimed to have Soha El Gabi invented several machines that can cure, among other things, AIDS and hepatitis C. One Said Abdelmessih of the devices, which a reporter said resembled “an antenna affixed to the handle of a blender,” claimed to detect the viruses that cause both diseases, while another reportedly Production Supervisor acted like a dialysis unit to “purify” the blood, curing 100 percent of AIDS cases and 95 Hany Elias percent of hepatitis C cases. The news that the Egyptian military had hit upon “miraculous” Advertising Director cures to not just one but two deadly illnesses the global scientific community has been Amany Kassem working to cure for decades was met with a mix of outrage and humor. Essam Heggy, a scientific advisor to interim President Adly Mansour, called the claims a “scandal” that Advertising & Circulation Assistant could damage Egypt’s reputation. For comedian Bassem Youssef—who is also a cardiac Raghda Salama surgeon—the news provided plenty of satirical fodder. Still, these diseases are no laughing matter. Egypt has the world’s highest prevalence of Market Watch Analyst hepatitis C, which can lead to cirrhosis and liver cancer, with an estimated 20 percent of Amr Hussein Elalfy Egyptian blood donors testing positive, according to the World Health Organization. While HIV prevalence rate remains low—under 1 percent—those who are infected often face so Chamber News Contacts Nada Abdalla, Nihal Alaa, much discrimination from health workers that they opt to forego care. A staggering 31 per- Shorouk Genena, Salma Shaaban cent of children under five suffer from stunted growth from malnutrition. Concerns have been raised about the Egyptian health sector’s ability to tackle these afflictions and other challenges likely to grow along with the population, from drug addiction to swine flu. Health care spending in Egypt represents about 5 percent of GDP—on par with other emerging markets but much lower than the Western world. Many have pointed out that redistributing resources from the top-heavy Ministry of Health, where the bloated salaries of senior administrators eat up valuable pounds, would mean more money for patient care. Even private donations to hospitals often come in the form of new equipment or build- ings; little goes to providing better training and pay for physicians and nurses, points out the Kasr al Aini obstetrician. In the meantime, Egyptian doctors continue to decamp for U.S. address: 1615 H Street, NW • Washington, D.C. 20062 greener pastures. “You can’t serve your country when you’re hungry,” he says. Please forward your comments or suggestions to the Egypt editorial office: Business Monthly American Chamber of Commerce in Egypt RACHEL SCHEIER 33 Soliman Abaza Street, Dokki 12311 • Cairo • Egypt Tel: (20-2) 3338-1050 • Fax: (20-2) 3338-0850 E-mail: [email protected] www.amcham.org.eg/bmonthly CTP and printing: Sahara Printing Company, SAE – Nasr City Free Zone 8 I Business Monthly – February 2014 Viewpoint WHO HATES EGYPT? omeone is hitting the brakes and trying to stop Last month, the board of AmCham Egypt and the Egypt- the growth of this country. There are frequent U.S. Business Council together visited Washington, D.C. disruptive criminal acts, new to Egypt and hard Discussions held with representatives of think tanks, Congress to understand. Is it possible to accept the fact and administration officials all confirmed that the current that certain nationals are actively seeking to aggressive, repressive stand, though often understandable, is destroy their own nation? Is it reasonable to leaving a bitter taste and working against the progressive envi- believe that anyone will want to build on rubble? ronment we are trying so hard to build. There are no good answers to these questions. I am not Egypt freed itself from the “listen and obey” rhetoric of inclined to trust conspiracy theories; however, the facts speak the past, and it must go back to trusting others outside the for themselves. Violence is alive and well, and all proponents closed power circle. The last thing we need is give the of these disruptive acts have to be condemned and brought to impression that a new group is simply following in the Sjustice. footsteps of the old one. Giving in to blackmail and arm twisting is a catastrophic While there is a broad pragmatic recognition of Egypt's recipe for failure. We in the business community have learned strategic location in the turbulent Middle East, there is the hard way that it does not pay—if you give in today, there also a realization of our production potential and buying is no reason why you won’t tomorrow, until the situation power. Hence the urgent need to get back to work to avoid becomes a lawless jungle based on brutality and fear. the danger of being sucked in by turbulence and drifting In a country in which the majority of the population is backwards. unable to read and passively bombarded by messages from the Mounir Abdel Nour, now Egypt’s minister of industry, for- media, there is an enormous responsibility borne by television eign trade and investment, gave a hard hitting and well- news anchors and reporters. While it’s normal for news to be received speech at the U.S. Chamber of Commerce. He high- sensational, it would make a huge difference if stories about lighted the success stories of American firms in Egypt and explosions, death and crimes were followed by a touch of real- investment opportunities as well as challenges. We should ity and optimism, in order to create a climate conducive to work to exploit the momentum created by the visit and his hope and success as opposed to fear and desperation. Getting speech; it would be a shame to let serious efforts go down the used to a constant flow of bad news is dangerous. drain. A climate of fear leads to a general state of paranoia. Hasty, Hard work, fairness and strategy can vanquish hate and uncalculated reactions are disproportionate and often cause fear. All of us are given the same number of hours each more harm than good. The recent sentences and arrests are day; unfortunately, some of us use them productively detrimental to the image, credibility and business climate of while others are in danger of wasting them.

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