Egypt set to cruise on the investment highway

Last Friday marked the opening session of Egypt’s Economic Development Conference in Sharm Al Shaikh, designed to attract foreign investment. The turn-out was phenomenal. Organisers told Al Ahram that whereas they were expecting around 1,700, some 3,500 turned up. The conference hall, graced with Arab and African heads of state, senior ministers, European foreign ministers and officials from the International Monetary Fund and the World Bank, as well as more than 2,000 interested investors from 112 nations, was proof that Egypt is seen as ready and open for business.

But even President Abdul Fattah Al Sissi could not have imagined how much genuine warmth and praise would be lavished on his government and the Egyptian people in what turned-out to be a veritable love-fest providing a boost to national pride and confidence when just over year ago, the country was virtually isolated — except for its staunch Gulf allies who were unstinting in their generosity. The order of speakers — Arabs first, Africans next, Europeans and others last — may have put some noses out of joint, but it showed that Cairo puts its regional allies first and foremost.

Addressing delegates to the conference, His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, said: “Egypt is our second country and the UAE is the second country of Egyptians.”

Saudi Crown Prince Muqrin Bin Abdul Aziz stressed his support for Cairo’s efforts to combat terrorism and pointedly called upon the international community to quit using double standards against Egypt. Kuwait’s Emir Sabah Al

Ahmad Al Jaber Al Sabah welcomed the recently overhauled investment laws as being “positive” for investors.

Lebanon’s Prime Minister, Tammam Salam, said the turmoil Egypt has experienced since 2011, forcing the government to focus on domestic problems, has deprived the Arab World of Cairo’s traditional key regional role, opening the door to foreign intervention. He described Egypt’s revival as essential for the region’s stability and investment in Egypt.

One of President Al Sissi’s widest smiles followed a speech delivered by Hailemariam Desalegn, the Prime Minister of Ethiopia, a country with which Cairo has had strained relations over the Grand Ethiopian Renaissance Dam that threatens to reduce the flow of Nile waters to Egypt. “The Nile constitutes a common destiny: We either sink or swim together. You know, Mr President, we chose to swim together,” said Prime Minister Hailemariam Desalegn, whose parting remark to the Egyptian President was, we met you and we loved you.

The entire hall rocked with laughter at US Secretary of State John Kerry’s slip of the tongue. “We will all strive for the future of Israel,” he said before swiftly apologising for his error. Kerry was effusive in his praise for Egypt’s efforts to turn around the economy, but this representative of the wealthiest country in the world arrived empty-handed apart from a vague hope that a decision on his country’s delivery of withheld F-16s would be taken soon.

In purely practical terms, the conference can already be judged as a success. Saudi Arabia, the UAE and Kuwait have each pledged $4 billion (Dh14.71 billion) in aid and investments; Oman promised $500 million. Sudan will open a new border crossing with Egypt to facilitate exports to Africa and has announced cooperation in the agricultural sector.

Last Saturday, Egypt signed a $12 billion deal with British Petroleum for the development of gas in the West Nile Delta, believed to be the largest commercial foreign investment in Egypt ever. Moreover, Chile’s state oil company plans to invest $30 million to build an oil pipeline through the western Desert. The French Development Agency has offered a sovereign loan to finance a power plant in Upper Egypt and General Electric announced it will invest $200 million in a manufacturing and training facility. On the second day of the summit, Egypt signed energy deals worth more than $40 billion.

China’s Minister of Commerce said his nation would strengthen cooperation with Egypt in the fields of infrastructure, energy, culture and tourism. PepsiCo plans to invest $500 million this year; Coco-Cola has pledged to invest the same amount over the coming three years. The African Development Bank has announced it is ready to offer loans up to $450 million this year. Bahrain’s Al Baraka Banking Group proposes to invest in various projects unveiled during the conference to the tune of 2 billion Egyptian pounds (Dh962,806).

The Egyptian telecommunications billionaire, Najeeb Sawiris, says he and his family are poised to invest $3 billion in new energy projects. “Egypt is the most stable country in this big mess,” he said. “We’ve acknowledged the mess in Libya, the mess in Iraq, in Syria. The fact is, Egypt is solid. Egypt is stable. We are actually the last pillar of resistance against uncertainties.”

Among the mega projects unveiled at the conference was Egypt’s new capital city, ‘a smart city’, to be created on 700 square kilometres, just 45km east of Cairo along a corridor to Suez and the Red Sea resort of Ain Sokhna in order to ease the historical capital’s overcrowding. The as-yet-unnamed, futuristic “world capital” will be home to approximately five million residents as well as ministries, government buildings and foreign embassies and will generate 1.75 million permanent jobs. Designed to be pedestrian-friendly and dedicated to the country’s youth, it will be redolent with green spaces, parks, tree-lined walkways and lakes. The website Capital Cairo, predicts that it “will be buzzing with life, day and night”.

This is no pipedream. Last Saturday, Egypt’s Housing Minister, Mustafa Madbouly, and Emaar’s chairman, Mohammad Al Abbar, in his capacity as co-founder of a new company Capital City Partners, signed a $45 billion contract covering the construction of the project’s first phase, scheduled to be completed within seven years. Arabtec is said to be poised to sign a contract to build one million housing units for low-income Egyptians within days.

Al Sissi is not short of big ideas — and thanks largely to his friends in the Gulf, he has the wherewithal to follow through on his plans at the rate of knots. But not everyone is impressed, though. Muslim Brotherhood channels airing from Turkey contend the Egyptian government has been hiring multi-lingual actors to pose as investers. Sure, and I have got an ancient pyramid in my back garden for sale.