Foreword from Ian Gray OBE, Chairman of the Egyptian-British Chamber of Commerce
When people in the UK think of Egypt, they usually think of holidays on the Red Sea, the cultural history of the Pyramids and the challenges of Middle Eastern politics.
What is often forgotten by the business community are the great business opportunities that exist for bilateral trading with, and investment in – and from, Egypt.
Egypt has a population of nearly 100 million, creating a vast consumer market. It sits as the gateway, geographically and economically, into Saudi Arabia (only an hour’s sailing time from its Red Sea ports), the Gulf and Africa. Egypt is a member of GAFTA (Greater Arab Free Trade Agreement), COMESA and other regional trade bodies, allowing trade with Gulf and African countries largely free of trade barriers or tariffs. An Association Agreement also provides significant benefits to Egypt’s trade with the EU.
Political events in 2011 introduced a period of uncertainty but the economy continued to grow, and businesses continued to trade successfully. Developments in more recent years have restored a stable business environment and many successful Egyptian firms are looking to develop trading relationships with UK companies.
President Sisi has recently been re-elected and has just appointed Moustafa Madbouly as Prime Minister. Madbouly has a strong record from when, as Minister for Housing, Utilities and Urban Development, he created infrastructure and urban renewal projects amounting to £16.6 billion since 2014.
The IMF has recently approved a $12 billion loan to Egypt recognising the Egyptian Government’s implementation of difficult fiscal measures, including reductions in subsidies and some tax increases.
The Egyptian Pound was devalued against the US Dollar after the Pound was allowed to float for the first time in November 2016 and in May 2018, Standard and Poors upgraded Egypt’s sovereign long-term debt rating from B- to B, confirming B for the short term.
All these measures indicate a recognition by global institutions of the strong progress being made at a macro level by Egypt.
Meanwhile, trade between the UK and Egypt at £1.1 billion in 2017 dropped from £1.2 billion in 2016 despite the UK having several examples of successful businesses in the country. BP and Shell benefit from access to Egypt’s substantial hydrocarbon resources but Vodafone and HSBC are among the largest companies in Egypt and have built their great success over many years by capitalising on the exceptional pool of talent provided by Egypt’s people (enabling them to deliver high quality services).
Egypt produces nearly 300,000 graduates every year, almost all speaking English and enthusiastic about working with international companies. The new industrial zones close to the recently expanded Suez Canal and the New Administrative Capital being built between Cairo and the Suez Canal also offer great opportunities for expansion at low cost.
Lastly the creation of all this new infrastructure has in itself created many opportunities for UK companies – although other European and Asian companies often appear more aware of these prospects.
The UK has a fast-growing community of small and medium sized enterprises that can benefit from understanding and taking the opportunities in and through Egypt. The Egyptian-British Chamber of Commerce is available to help guide businesses through the challenges.
Ian Gray OBE
Chairman, The Egyptian-British Chamber of Commerce
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