Egypt

Last year's government reshuffle was another sign of Egypt's commitment to weathering the current economic slowdown, especially in light of the September 11 attacks on the US. President Mubarak has been quoted as saying: "the reshuffle is aimed at introducing new ideas and opening up new prospects for the Egyptian economy."

Atef Ebeid, Prime Minister of the Arab Republic of Egypt, enumerates his country's goals: "Egypt is now witnessing its reincarnation into a modern, liberal private sector-led and market-driven economy. Priority has been placed on an aggressive export promotion drive that will increase our share of the world market, lower the balance of trade deficit, upgrade our products and promote industries that generate value-added goods and are geared towards export."

"Various measures are in place to speed up the process," says Ebeid. "We will further boost investment of the private sector and particularly foreign direct investment to supplement domestic savings. We will increase the free zone areas within Egypt, and encourage their use as an export platform."

In relation to this, Egypt is offering generous tax breaks to foreign investors, and encouraging projects in the New Delta (Toshka and South Valley). This will help Egypt move away from its traditional dependence on the Nile. The country is only able to use about 5 percent of its land area. Expansion into new areas will help the growth of new industry and infrastructure.
Egyptian Prime Minister Atef Ebeid

The scope of activities available for foreign investment has widely expanded over the years. One recent fruit of this more open policy has been the building of the Suez Canal Hanging Bridge - a product of Egyptian-Japanese co-operation.

"The bridge is the first of its kind in the Middle East," says Takaya Suto, Japan's Ambassador to Egypt "The metal structure of the bridge was installed by a number of specialized Japanese firms, and is a shining example of joint efforts between our countries. The bridge links Asia and North Africa by an international road, and is an important transit point connecting Egypt to the rest of the Middle East."

Japan and Egypt have traditionally enjoyed cordial relations. Over the years, bilateral relations have steadily developed through increased political, economic and cultural exchange between the two countries.

Takaya Suto, Japan's ambassador to Egypt

"Japan considers Egypt a country that deserves priority in Japan's assistance to the Middle East, especially in the expansion of agricultural productivity, human resource development, education and job training, infrastructure and technology development, and improvement in the living environment, including water-supply and sewage systems," Suto elaborates.

Japan has also played a part in the field of modern Egyptian culture, helping build Cairo's Opera House in 1988 with grant aid totalling $49 million. "There are already more than 55 Japanese companies operating in the Egyptian market, and the number is expected to increase," adds Suto. "A Japan desk has also been set up in GAFI (Egypt's General Authority for Foreign Investment) to attract more Japanese investment, and to build a better image of Egypt in Japan."

Efforts to increase foreign investment go hand-in-hand with encouraging local industry to increase exports. The development of a tax system in accordance with WTO rules, quickening of the customs process, and setting up advisory bodies to modernize marketing efforts abroad have all been aimed at this end Examples of successful Egyptian companies exporting abroad include Oriental Weavers and Ceramica Cleopatra, both of which deal extensively with Japan.

The ongoing economic reform program is aimed at updating modern Egypt in this fascinating, historic and strategic position straddling the Middle East and Africa. Investment pioneers in Egypt today can expect to reap benefits when the region attains its 21st century goals.

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