Interviews – Daily News Egypt Egypt’s Only Daily Independent Newspaper In English Wed, 16 Jan 2019 18:01:45 +0000 en-US hourly 1 Finding business use cases is prerequisite for building 5G network: Head of Ericsson Silicon Valley Experience Centre Mon, 14 Jan 2019 10:30:57 +0000 Since October 2018, Verizon started to offer 5G fixed internet wireless access in US:  Thomas Olsson

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Santa Clara- To feel the vibe of Silicon Valley and find more about 5G opportunities, Daily News Egypt (DNE) visited Silicon Valley’s Ericsson Experience Centre, where visitors can interact with several experts from Ericsson, and witness how technology and ecosystems will drive this transformation by empowering people, businesses, and societies with the solutions and expertise needed to reinvent what is possible.

The place offers an impressive showcase where you can immerse yourself in the latest innovations which will revolutionise our society. Whether you’re interested in networks, IT, or new industries, the centre will inspire you.

Ericsson is one of the leading providers of information and communication technology (ICT) to service providers, with about 40% of the world’s mobile traffic carried through its networks, with a comprehensive portfolio ranging across networks, digital services, managed services, and emerging businesses, powered by 5G and internet of things (IoT) platforms.

DNE interviewed Thomas Olsson, head of the Ericsson Silicon Valley Experience Centre, to determine his thoughts on the adoption of 5G technologies.

Olsson joined Ericsson in 2002 as the head of the Sales Managed Service business unit. He moved to Argentina in 2007, where he was responsible for service delivery and the network’s roll-out across the region in South America. From 2011, he became the head of Global Sales in the Business Unit Support Solutions, based at the HQ in Stockholm, and since 2016 he was named as Vice President and the head of Ericsson’s Experience Centre in Silicon Valley. He is the appointed spokesperson for Ericsson, representing this area, and also speaks at several industrial conferences and seminars.

The transcript for the interview is below, lightly edited for clarity:

How does the Ericsson Experience Centre boost innovation, and improve the tech eco system?

Being a big company, I think we contribute to the dialogue between different eco-system players, and we also educate ourselves through the dialogue with the start-up community as we know the limitations of current technologies, but we don’t know about the opportunities, and the limitations of the next one.

We are trying to be highly active in order to communicate with our partners. We talk about IoT, cloud-computing, artificial intelligence, and what we can bring to the process of industry solutions, as we go forward.

Therefore, I think we are contributing to that process, in addition to our traditional customers, the telecom operators, with half or even more of the traffic at the centre coming from start-ups, eco-systems, and big companies, as they all are trying to figure out what does the 5G technology would mean for them.

DNE interviewed Thomas Olsson, head of the Ericsson Silicon Valley Experience Centre, to determine his thoughts on the adoption of 5G technologies.

What is the biggest challenge facing the adoption of 5G, is it affordability?

To build a 5G network, it doesn’t have a one-use case, in 3G and 4G, the use-case was pretty much the voice connectivity and the mobile broadband, so it was the sim card that you were buying.

For 5G, it is not about the sim card any more, rather it is about the value of information for the industry, and when a machine would be able to communicate with other machines. Those values are part of the initial challenge to define the industry’s use-cases.

The benefit from doing that is that there will suddenly be more business cases, as well as incentives for operators to build a 5G network. I believe that despite the fact that the 5G adoption will be slower at the beginning, but the process will go much faster than it took us to change from 3G to 4G.

However, it is different this time as it is not only about changing from 4G to 5G, rather the new network will be a combination of both. Accordingly, the technology that Ericsson brought to the market will use the same hardware, and we will undergo a software upgrade of what is already there.

How can infrastructure-sharing reduce the cost and accelerate the implementation of the 5G technology?

I think that is actually happening as the possibility to have different use-cases on the same infrastructure will in reality make new use-cases affordable. Take the energy or the mining industry today for example, if you have an oil rig, they can afford to build a dedicated 4G network, but if you have a small workshop or a small garage-company they will not be able to. With 5G, the operator can offer them a shared network as if it was dedicated to them, so the network’s division and reuse will drive the speed of 5G.

When will the 5G revolution take place?

Since October 2018, Verizon has started to offer 5G fixed internet wireless access in the US. In the country, there are 30m households without a cable internet connection as companies do not have an incentive to provide it to these houses, so today these people have poor coverage.

Today, around 60,000 sites in the US are relatively covered with 5G. There are other sites which are not covered because the business case is not there, but if you have hard use cases, operators would build coverage, even where there is no coverage now.

In order to have a 5G network with no latency everywhere, the number of sites might go up from 60,000 sites to 600,000, or perhaps even a million.

A lot of these sites will be lamp-poles, 100 yards away from each other, that is necessary to eliminate latency. In order to build up this network, it will be a challenge, not in terms of technology, rather from a social aspect, as maybe some communities would not want more of this technology.

But I think the challenge for us as a company right now is exploring the limitation for 5G, we don’t know what impact it will have on the different utilities, and the different use-cases.

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Knowledge hub enters Egypt’s private university scene Sun, 13 Jan 2019 10:30:37 +0000 Project attracts several universities worldwide, to offer degrees in different specialties: El-Sewedy Education CEO

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With technology taking over the world in current decades, education remains one of Egypt’s main challenges in meeting the industrial market. Lack of good quality education, practical training, and relying on outdated taught theories as educational sources, are the common struggles facing millions of graduates who eventually find themselves unfit for international market requirements.

With the aim of fighting an educational system that brings the world an untrained, poorly educated graduate, El-Sewedy Education, an Egyptian education investment and management company, opens its doors to students starting from the 2019 academic year.

Knowledge Hub is El-Sewedy Education’s multidisciplinary project, consisting of different multinational universities located within the same campus. In their Egyptian campus, the internationally accredited universities offer students the chance of being taught the same curriculum students are taught in their native countries.

Coventry UK is the first university to sign the partnership agreement with the group. The hub offers students an education which meets international standards, through techniques that are being used for the first time in Egypt.

Daily News Egypt interviewed Ihab Salama, CEO of El-Sewedy Education to discuss further El-Sewedy Education’s new project, its goals and its future plans, the transcript for which is below, lightly edited for clarity:

Why did El-Sewedy Group decide to open a new university in Egypt?

The idea came when we started a corporate social resposibility activity four years ago, called El-Sewedy Technical Academy, which basically focused on vocational education. The programme accepts students after grade nine and teaches them a German curriculum which qualifies them to meet market needs.

From this day, we witnessed the impact on the community, and presently we feel that what Egypt really needs currently is the youths’ good quality of education. The country is in a deep need of well-educated generations, and education is no longer about the theoretical part, it has become more of how you connect with the current industry, as well as how you receive your practical training.

What does your university offer students differently?

We offer students a different model which is called the knowledge hub. The idea of that model is to attract several universities from all across the globe, each in their area of strengths, in order to offer their degrees in different specialties.

The campus is also designed in cluster areas in which technical studies’ students from different universities are combined together in one area. So, there’s an area dedicated to engineering school from all universities, while another is allocated to medical studies, and a third for social sciences and arts.

The beauty of these clusters is not only the degree you get from each university, but the inter-disciplinary connection you can create between all these universities.

Moreover, we provide students with a new educational system that is called the flipped classroom type of education, which is being offered for the very first time in Egypt. This system is different from the ordinary teaching system in which the professor stands in the middle of the classroom, dictating to students what to learn, and they have to memorise what they are being told; rather it is more about interaction, collaboration, and integration.

The flipped classroom system focuses on teaching students how to work in groups, encourages them toward critical and analytical thinking, as well as problem solving. Students in that system get their training ahead and use the group work to come up with a solution to the problem they have, which eventually teaches them what they need to learn. We believe this will change the landscape of education in Egypt.

How do you plan to overcome the challenge you have with several other private universities in Egypt?

I do not see any challenge. We do not compete with private universities in Egypt. Our model is completely different than all of theirs, as we are opening a university branch in Egypt which will host in one campus several world accredited universities.

As a start, we are opening a branch for Coventry, a British University in Egypt. As an academic partner, they come with their curriculum, teaching techniques and methodologies, quality assurance and control. So, El-Swedey University does not offer its students a degree, the graduation certificate they get is from Coventry University.

Our students will be registered in Coventry University and the certificate they get holds the same accreditation as students who graduate from Coventry, the UK, which is a total different aspect than private universities.

However, many of private universities’ certificates in Egypt are internationally accredited, what is the difference your university offers regarding that?

All private universities in Egypt grant students local degrees.

These universities offer an accredited curriculum.

The curriculum itself can be accredited worldwide because it is similar to other taught curriculums despite being improved locally. Nonetheless, our students are officially considered Coventry graduates or any of the signed-with universities’ graduates.

Since you are opening a branch from mother universities in Egypt, will the teaching staff be from Egypt or from the mother country?

All the heads of the departments will come from the mother branch and will be supported by professors from the same university as well.

However, a part of our focus as well is not only the students, but also to develop the way of teaching for Egyptian professors. So, we will provide them with training programmes in order for them to match the criteria of the mother universities, and upgrade their teaching methods.

That way we are benefiting the society from both ways: the students and the professors.

When are you planning to open you doors to students?

We are opening our admission next year. September 2019’s academic year will be ready to host students.

Where is your campus located?

It is located at the New Administrative Capital. It is a piece of 50 acre land, and we are only opening the first phase of it by the new academic year, with a five- to seven-year expansion plan.

What are the study fields the university is offering in the first year?

Engineering with all its fields and programmes, all the computing courses and media.

Will there be any exchange programmes between Egypt and the mother universities?

Yes definitely. The students have the right to go for a semester or a year to the mother university and vice versa. They are eventually all registered at the same university, yet different branches.

What is the  tuation fee range of Knowledge Hub?

We have not yet announced that, but the fees will be within the top fee range of private universities in Egypt.

At the end of the day, we are offering a different education model in which there is a partnership with a foreign university and several professors coming from all across the globe to teach your students.

Are you offering scholarships?

Yes. We will offer an athletic scholarship and top students will be released from fees.

Will you offer post-grad studies?

Definitely, but not from the first year. We are also planning to open our doors for masters students.

The campus will also be a hub for entrepreneurship to encourage students to open their own startups and support the innovation of entrepreneurship.

From your point of view, what are the main challenges facing you in the Egyptian market?

To be honest, we have substantial support from the government from all aspects in order to make this a successful experience.

We are mainly facing challenges in schools with the type of education students get. However, we will look into it, as it is our role to bring these students up to the highest level in order to match the type of education we are offering them, which will later on make them meet the criteria the employment market needs.

Another challenge we are facing is to deliver this new education model to both students and parents for them to understand the difference between a private university and a branch campus.

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Municipalities’ contribution to national income is not less than 30%: former governor of Qaliubiya, Menoufiya Wed, 09 Jan 2019 09:00:05 +0000 Local community activities in governorates contribute 30% to national income

The post Municipalities’ contribution to national income is not less than 30%: former governor of Qaliubiya, Menoufiya appeared first on Daily News Egypt.

As former governor of two large governorates, Qaliubiya and Menoufiya, and someone who contributed in drafting the new local community management bill, Adli Hussein introduced an integrated vision of the forthcoming bill, depicting the monitoring roles it includes.

Hussein also explained in an interview to Daily News Egypt how the absence of elected local community councils since 2011 till now has not only negatively impacted the economic scene in Egypt, but equally the megaprojects which have been established throughout the past four years.

The transcript for the interview is below, lightly edited for clarity:

How much does the constitution support governorates and their local activities?

The 2014 constitution carefully deals with local development. The constitution supports it with decentralisation financially, administratively, and technically in order to enhance the role of community councils in each governorate. Plus, it provides these councils with full autonomy to enable them to play their roles without any restrictions or burdens. In addition, according to the constitution, the decisions and resolutions that are released by these councils are irreversible. But, actually, the new bill sets only three condition to for opposition. They are in the event if those decisions are against the public interest, or are illegal, or if they conflict with other resolutions released by other community councils. Moreover, it ensures that the election is be the method of the governors’ appointment.

From your perspective, why has this bill not been released yet?

The new bill is supposed to be ready after discussing it in both plenary session and local government committee meetings in 2016 and 2017. But, I was surprised when the chairperson of the local government committee in House of Representatives stated that the government is not yet ready to hold local community elections. Indeed, the new bill is stills not on the parliament’s agenda.

To what extent has Egypt been affected by the absence of local councils in all governorates?

These elections are the main means of acquiring the experience of political practice in Egypt. Actually, it supports the democratic composition to the point where its role is more important than the parliament itself, as these entities and its elected members directly stay in touch with citizens, and deal with their troubles and complaints on a daily basis. Furthermore, the new bill adopts interpellation as a measure to interrogate officials who are responsible for any dereliction, including the governor himself. Thus, the formation of local community councils is an important guide for political practice, and the democratic process is in dire need for it. Actually, Egypt has not experienced similar elections since 2011.

But it has been a very long period, so, what is the impact of this situation during this extended time?

In contradiction with the constitution and law, since the dissolution of these councils in the wake of 25th uprising in 2011, all governorates are acting without their local councils, although the constitution and the existing law provide for forming interim councils in case of the dissolution of existing ones. It has not been happened till now, hence this case is a deeply unconstitutional and a legally flawed condition.

What can concerned bodies do to avoid this complicated situation?

Unquestionably, we must promptly form interim councils to avoid this unconstitutional and illegal condition. In addition, these interim councils will support governors to perform their duties. Furthermore, they are responsible for any oversight concerning the governor’s performance.

What about the impact, in particular on the Egyptian economy, especially on the reform programme?

Unfortunately, the absence of these councils has significantly harmed Egypt’s economy. Land allocations, budgeting, imposing local activity fees, approving the establishment of new projects in governorates, and oversight of the governor’s duties are essential roles of these councils. Thus, all governorates have suffered in their absence. In addition, it has a negative impact on sustainable development in governorates which is the key issue of the Sustainable Development Strategy Egypt 2030, definitely affecting the investment environment.

Does it mean that these councils have a major role?

That is right. Members of these councils, depending on their daily connection with people, would have a mission in persuading them with the new economic procedures which include serious ones for citizens’ daily life such as the floatation of the Egyptian pound, phasing out energy resources subsidies, increasing service fees, and other similar procedures. That would have played a significant role in this regard, which, eventually, would help the government to keep operating smoothly. Their role is more important than the role of the media or even the parliament.

As a participant in drafting the new law, what are the monitoring tools that were included?

The oversight tools that are insured by the new bill, included questioning, requests for briefing, and interrogation, which are vital for reproaching negligence to the extent that governors can have confidence withdrawn from them. What’s more, the key issue is that the new bill devotes an entire section for Cairo as the capital city with a special condition on the grounds that is the ruling centre and the headquarter of most ministries and governmental bodies. Moreover it is the most populated and most vital city, in a manner which distinguishes it from other governorates. This is the model which is followed in all developed countries such as France, Brussels, and London. Thereby, this is a good step forward as it secures more powers and competencies.

What about qualifying personnel in these local communities to become competent leaders for local councils?

A new national academy is supposed to be established according to Article 10 of the new bill, for all who work in local communities and all who intend to run for local council elections, in addition to qualifying personnel to assume leadership posts. This would bring an end to depending on assigned employees from ministries or departments to work in local councils.

How will these instruments facilitate the work of these councils?

They will provide the chance for governors and local councils to work more independently; approve new projects and establishments; offer economic incentives for investors; boost small, medium, and micro enterprises, and promote investments in each governorate. In this regard, I would like to mention a successful instrument which attracts investments that I had applied when I was a governor of Qaliubiya, which is Fraternities Agreements. This instrument allows for the cooperation and exchange of experiences between Egyptian local councils and their counterparts in other countries. I wish that the final draft of the new law would allow for these kinds of agreements.

As a former governor, can you estimate local community activities’ contribution to the national income?

Not less than 30%.

And how do local councils support the megaprojects which have been established?

These megaprojects are supposed to open branches in some of the Egyptian governorates which could pave the way for new investments in these governorates, followed by offering new job vacancies. In this regard, the local councils have a role to remove obstacles which restrict these new investments.

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2018 is booming year for tourism in Hurghada throughout last 3 years: Guirguis Tue, 08 Jan 2019 10:00:36 +0000 Hilton Hurghada Resort launched new renovation plan, scheduled to be completed by 2020

The post 2018 is booming year for tourism in Hurghada throughout last 3 years: Guirguis appeared first on Daily News Egypt.

Despite Egypt being one of the best destinations for tourists worldwide, and known for having the most attractive locations, tourism has declined for a long period, but with the government’s and the private sector’s incentives, Egyptian tourism has witnessed a major boost during 2018.

Marketing the sector was one of the challenges listed on top of the government’s work agenda for the past years. Reviewing the prices strategy, opening new markets, development, as well as improving the security conditions, were the main factors which helped the return of tourism after two years of unstable conditions, following the crash of the Russian airplane in 2015.

Daily News Egypt interviewed the General Manager of Hilton Hurghada Resort, Gilaine Guirguis, one of the leading figures in the tourism sector who has worked in it for almost 37 years. During our interview, she introduced the hotel’s renovation plan, which is to be fully executed during the upcoming few years, and explained how the hotel worked on flourishing tourism with the government’s help during the time of crisis.

Gurguis was the general manager of Hilton Marsa Alam Nubian Resort from 2013 to 2016, and the general manager of the Hilton’s Fayrouz Resort in Sharm El-Sheikh from 2011 to 2013.

The transcript for the interview is below, lightly edited for clarity:

To begin with, will you give us a brief on the current situation of the tourism in Hurghada, compared with the past years?

Tourism has really improved much during the past two years all over Egypt. The foreign tourist is willing to fly to Egypt for a stay, however tourists became more selective than before.

After the 2015 incident, Hurghada’s tourism sector was negatively affected, as the Russian tourists were the main market feeders. Accordingly, both hotels and travel agents started to look for alternative markets in order to recover from this decline, while depending on the domestic tourism.

In 2017, slight changes began to appear on the ground, especially after the flow of the Chinese market to Egypt. Chinese tourists like to visit Egypt in groups for five-nights tours divided between Hurghada and Luxor. This is in addition to the flow of tourists from specific European countries like the UK and Germany to Hurghada, instead of Sharm El-Sheikh due to flight suspensions. Currently, we can see that the occupancy rates and the number of flights are increasing in Hurghada.

The improvement of occupancy rates encourages many hotel owners to invest in building new hotels and extending the total number of guest rooms in Hurghada, which is an indicator prooving that tourism is actually doing well.

What was Hilton Hurghada’s role in promoting tourism?

First, let us note that the Russian tourist was the main one contributing to the Egyptian tourism market until 2016. Accordingly, we started to collaborate with travel agents to explore new markets and search for alternative tourists to visit the country. 

We prepared a strategic sales plan to increase the current flow of tourists from the UK, Germany, and Lebanon in parallel with penetrating new markets such as Belgium, India, China, Armenia, Kazakhstan, and more notably France.

Some of those markets have specific requirements in order to come and stay with us. For example, the Indian market requires an Indian chef to accompany tourists in order to cook their meals and recipes. After we looked into this request, we succeeded to execute the business deal once we dedicated a separate kitchen and obtained the required equipment. Their feedback on the hotel’s action has been significantly positive and satisfying.

How do you describe the occupancy rate in 2016, 2017, and 2018?

In 2017, a noticeable increase of 27.9% has been recorded compared to 2016.

In regards to 2018 results, we haven’t announced our Q4 year-end earnings numbers yet, they are to be released in the near-term, yet occupancy rate, and total revenues have improved, compared to 2017. Moreover, Hilton Hurghada recorded great satisfaction and problem resolution scores.

Are you planning on increasing the prices during the upcoming period?

As long as we are in a high demand, reviewing the pricing strategy is essential. For instance, we are witnessing high demand during January and February, so I decided to increase the prices, and no negative feedback was witnessed.

Did the Al-Haram district incident affect the hotel’s occupancy rates during the Christmas celebrations?

We did not receive any cancellations, and I also think that the attack did not leave any impact on tourism anywhere in Egypt.

During the evening of the day of the attack, we prepared a sheet and we expected that we will start taking cancellation requests, but thankfully, no one submitted any cancellation or even any guest left the hotel.

We were so worried especially that the timing of the attack coincided with the New Year’s and Christmas celebrations, so it was definitely a high season.

How did your hotel work on its marketing strategy during the decline of tourism?

Our marketing strategy depends on two factors, the outbound marketing, which focuses on the ways to reach clients. Our dedicated sales team plans regular sales calls and visits to tour operators in Egypt and abroad. Those trips mainly aim to strengthen the business collaboration between the hotel and tour operators, and usually help in exploring new ideas and alternatives to support the business, so that we are capable of choosing the right promotions at the right time, and to the right people. We also were keen to be present in all the international travel forums and exhibitions. As for our second strategy, the inbound marketing, our focus is to boost digital marketing, and work on updating the website, keywords, content, images, online travel agencies (OTAs), as well as our social media presence.

What was a major achievement that Hilton Hurghada implemented in 2018?

Hilton was established 25 years ago, so the hotel needed some upscaling to cope with the guests’ expectations, especially that Hilton is one of the few hotel chains in Hurghada. As for my work agenda, it was important to prepare something which will meet all our new clients’ expectations.

First, we started with renovating the rooms, as they were built several years ago, and it was important to reconstruct new interiors in order to cope with modern designs.

The rooms’ renovations are planned to be finished in phases, putting into consideration that we have to avoid the guests’ interruption during their stay. This is the reason why we work in winter when the occupancy rate is lower than in summer, so that we are able to close and renovate those rooms. During the summer, hotels are fully booked, and it is not easy to lose our guests.

We already finished 80 out of 400 rooms. This phase took almost six months from January to July 2018. The rooms are now decorated with a new interior style, making them more delightful and colourful. The rooms are completely renovated including their colours, ceramics, as well as the furniture.

We are now preparing to start working on another 80 rooms during 2019, and will continue until we are finished with all the 400 rooms.

The new phase is expected to start this January, and will end by the beginning of the summer. We are planning to finish 280 front-line rooms by 2020.

Restaurants are also part of the renovation, as we are looking forward to expanding the size of the restaurants to accommodate the numbers of guests. We are expected to work on this after finalising the rooms’ refurbishment. Occupancy is mostly over 80%, so we do not want the guest to feel that the restaurant is overcrowded, and that is why we had to renew it.

Moreover, we also have another 121 rooms located in the second line of the promenade,

as they were designed in an older stage than the front-line rooms, and we will still have another four to five years for their complete renovation, and we are working on a refurbishing plan for a period of one year.

What were Hilton Hurghada’s challenges during 2018?

First, we had a big challenge in improving the food taste and quality, which made us replace the chef two times, until we succeeded in reaching the best results which we were looking for. We also conducted training courses for our chefs.

We also changed the animation team three times. In addition, we constructed the Aqua Park, which was really one of the best ideas. Most importantly, we succeeded to start our renovation plan.

What are your main goals for 2019?

We are looking to start the second phase of the room’s renovation and increase corporate business. We increased our business with big corporates such as petroleum services companies.

We also launched a plan in order to arrange weddings by the beach, something that we already started, with the first wedding held two months ago. We are coordinating with various wedding planners in Hurghada to reach out to Hurghada’s residents, letting them choose Hilton as the venue for their wedding celebrations.

Recently, people are more frequently visiting places like Sahl Hashish, Gouna, and Dahab as they are becoming mainstream destinations, do you think this has influenced tourism in Hurghada?

No. Our clients are different, and each destination has its specific market and visitors. The hotels here are different, which combine both shopping and relaxation. Clients choose places according to their needs.

How did you work on improving the employment rates?

Due to the tourism’s decline during the past three years, many employees left Hurghada to look for other jobs. Therefore, we worked on training fresh graduates in order to select the best ones. The induction-training plan takes place for 15 days before joining the hotel’s operation.

We are now very concerned with language abilities more than before, and we do not accept slang language anymore. We also targeted breadwinner females, as we train them on cooking and baking pastries, and provide them with the chance to work with us.

We already trained 10 females who send us baked desserts, and anyone who wants to learn or work, we are open to teaching them.

We also do some community work by sending some equipment and materials to charity organisations so they can use them to train children and young people who are interested in working in the tourism sector.

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Egypt is among largest Arab markets, insurance diffusion remains low: El Khatib Mon, 31 Dec 2018 11:00:48 +0000 Company’s assets increase by 19% for last 3 years, after distributing $10m of dividends in 2017

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Egypt is a huge country with nearly a population of 100 million; however, its insurance market cannot be considered mature enough, even though it has witnessed some changes in recent years. According to the Financial Regulatory Authority’s (FRA) latest report, the non-life insurance (property) companies in Egypt achieved premiums worth EGP 12.4bn during the first 11 months of 2018 (11M18), up from EGP 11bn during the same period last year, a 12% growth. Life insurance companies operating in Egypt achieved premiums worth EGP 28.2bn in 11M18, compared to EGP 21bn in 11M17, an increase of 34%.

Osama El Khatib, vice chairperson and managing director of AIG Egypt Insurance Company, informed Daily News Egypt that the depth and penetration of insurance in Egypt is one-quarter of Tunisia and one-fifth of Morocco, proceeded by Qatar, Saudi Arabia, and the UAE respectively. This shows the challenges faced by insurance companies and the absence of awareness about the benefits of insurance and its significance to protect all segments of the society, as well as commercial, industrial, and financial sectors.

AIG is a global property-casualty and general insurance organisation serving more than 70 million clients around the world.  With one of the industry’s most extensive ranges of products and services, deep claims expertise and excellent financial strength, AIG enables its commercial and personal insurance clients alike to manage virtually any risk with confidence.

Daily News Egypt interviewed El Khatib to discover his views on the local insurance market and AIG Egypt’s latest plans, the transcript for which is below, lightly edited for clarity:

How do you see the Egyptian insurance market in view of the current challenges?

Egypt is among the largest Arab markets, but the depth of insurance (total underwritten premium to total local production) is very low. The insurance penetration and average per capita expenditure on insurance (total underwritten premium /population) is very modest. The depth and penetration of insurance in Egypt is actually one-quarter of Tunisia and one-fifth of Morocco proceeded by Qatar, Saudi Arabia, and the UAE respectively. This shows the challenges faced by insurance companies and the absence of awareness about the benefits of insurance and its significance to protect all segments of the society, as well as commercial, industrial, and financial sectors. I’m sure that the path adopted by the FRA and the Insurance Federation of Egypt (IFE), in coordination with the government, is the best to protect all social classes, especially low-income people, and to benefit the whole economy in general. The role of insurance companies in helping to protect the Egyptian economy is very important, as their task is to study market requirements; find the products they need; spread awareness; find the suitable channels for distribution, and payment of claims. Since the depth and intensity of insurance in Egypt is low, there are great opportunities for insurance companies for growth for the benefit of all.

Osama El Khatib, vice chairperson and managing director of AIG Egypt Insurance Company

What are the main challenges faced by foreign companies in their expansion in Egypt?

Any investor, whether foreign or Egyptian, conducts studies before any investment is made, either for the first time or expansion. In addition to the feasibility study, investors carry another important step which is a risk study– that may prevent them from achieving their objectives. Hence, they can analyse and compare between countries or regions to identify whether the investment is reasonable or not, and what is the investment failure rate if exposed to each risk or all risks. The 10-levelled analysis is usually based on political; economic; legal; tax; operational; safety, and security risks. In Egypt, the youth represent 52% of the population. The local production is growing, reaching 4.5%. If the government invests in substantial infrastructure and energy projects, inflation will decline, production of oil and gas will increase, and Egypt will become an exporter of both instead of being an importer. This is the current situation in Egypt. It is a significant improvement in all of the mentioned fields. Security, improving economic situation, and establishing a strong legislative environment are what encourage foreign investors to come to Egypt and expand which was reflected in the growth of foreign direct investments (FDI) and classifying Egypt’s credit rating by Standard & Poor’s at B with stable outlook.

How do you see the Sharm El-Sheikh Rendezvous Insurance Conference’s impact on the insurance sector and in attracting new FDI to the Egyptian market?

The Sharm El-Sheikh Rendezvous is one of the regularly organised rendezvous by the IFE. These rendezvous are very important as they bring together regulators, insurance companies, and investors from Egypt and the Arab region.

The federation seeks to coordinate with all related parties for the benefit of the Egyptian community and economy and to attract foreign investment. Such rendezvous reveal a clear insight of the future and the chance for investors to get answers to their concerns, observations, and ideas, and link investors, legislators, and executors together.

What is your company’s expansion plan in the Egyptian market?

There are different types of expansions, either geographically, issuing new products, opening new distribution channels, etc. I would like to maintain confidentiality of our expansion plans until it gets approved by the board of directors.

What is the company’s position in the market after the announcement of auto and personal property withdrawal?

I would like to note that we did not stop issuing auto coverage, but we restrict and reduced it for strategic purposes. Some people thought that we ceased the issuance of auto insurance which is not correct. We still have auto insurance for a selective customer base. Our share in the Egyptian market is 3% of the general insurance sector premiums for the year ended June 2018. Note that we have a very limited portfolio in the auto insurance business. If the total auto premium is separated from the total, then our share in the market is much larger.

The reality is the intended withdrawal from the market, laying off company employees, and closing some branches, whereas nothing is true about our withdrawal from the market. AIG has a historical presence in Egypt and remains committed to the Egyptian insurance market. AIG is focused on ensuring meeting the customers’ and partners’ needs. AIG is one of the leading companies in Egypt known for innovative products and high levels of service. All of this is only possible with the dedication and professionalism of the AIG Egypt team. Like any other company, AIG Egypt is constantly reviewing its infrastructure to ensure the company is established in a way that is efficient and relevant for the customers and the Egyptian insurance market. We are pleased to work closely with our esteemed insurance regulator, the FRA. Furthermore, AIG Egypt prides itself on ensuring compliance with local regulation and participating in the development of the insurance market of Egypt. The company is committed to investment and brining international standards to its operation in Egypt. We are well on track to complete the restructuring actions taken to secure the operation’s sustainability and long-term future. In addition, AIG Egypt’s strategy is set and its three-year business plan is already in motion to take AIG Egypt’s operations to the well-deserved international level.

What is the parent company’s strategy in the Middle East?

I represent AIG Egypt only and answer only questions related to my company.

What about AIG Egypt’s 2017 financial position/balance sheet (performance)?

AIG has a strong financial position and adequate assets to cover its labilities towards the policyholders and the shareholders. The company’s assets increased in average by 19% for the last three years even after distributing dividends of $10m to shareholders in 2017.

The pledged investments to the regulator are higher than the policyholder rights by 234% (at net basis) and higher at gross level (as required by the regulator) by 45%. All investments are either in cash and cash equivalent or governmental securities (i.e. very conservative with minimal risk), and 77% of the receivables are from clients that have been with us for less than three months. The above shows the strength of the financial position of the company.

What are the company’s new products?

We have been honoured to be tasked by the FRA to prepare a product covering cyber security risks. This product has already been processed and delivered to the authority and reviewed by them. We have already received their approval last week. I want to thank the FRA for giving us the chance to contribute in providing them and the market with such an important product, as part of the authority’s efforts to protect companies, especially the financial, banking, and asset management companies from risks that they may be exposed to.

Digital nations are confronting an increase in cyber security threats in both public and private sectors causing widespread disruption. Egypt is a nation on its way to digitalisation and this risk is to be mitigated. Companies that suffer data breaches will sustain heavy losses due to theft or loss of data, data destruction, legal expenses (advice and defence) in addition to revenue losses from network or computer outages, including cost of restoring lost data, cyber extortion expenses among other risks. AIG offers coverage in the event management, network interruption, and cyber extortion risks.

We also intend to enter the field of micro and small, and travel insurance products along with the principal core that characterises AIG which are property and accident insurance and reinsurance. For the time being, we will also be in track with the regulators.

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Egypt among top 20 fastest-growing markets, if we want to grow, we need to invest in this country: Twitter’s Middle East, North Africa managing director Tue, 25 Dec 2018 09:00:23 +0000 We value increasing ad revenues, but not at expense of platform users’ safety, health of conversation, says Ampen

The post Egypt among top 20 fastest-growing markets, if we want to grow, we need to invest in this country: Twitter’s Middle East, North Africa managing director appeared first on Daily News Egypt.

Twitter can be described as one of the top online news and social networking platforms on which users post and interact with messages known as “tweets”.  California-based Twitter Inc has more than 25 offices around the world.

Created in 2006 by Jack Dorsey, Noah Glass, Biz Stone, and Evan Williams, Twitter managed to rapidly gain worldwide popularity. In 2012, over 100 million users posted 340 million tweets a day, and the service handled an average of 1.6bn search queries per day.

In 2013, it was one of the ten most-visited websites and has been described as ‘the SMS of the Internet’. As of 2016, Twitter had more than 319 million monthly active users.

The social media platform has been the centre of debates and news covering politics of the United States and elsewhere, especially during the 2016 US presidential election, Brett Kavanaugh’s Supreme Court nomination, and 2018’s US Midterms.

Twitter proved to be the largest source of breaking news on the day of the 2016 election, with 40m election-related tweets sent by 10 pm.

Daily News Egypt interviewed Twitter’s Middle East and North Africa Managing Director, Benjamen Ampen, to find out about the company’s latest financial results and future plans, the transcript for which is below, lightly edited for clarity:

How did your business perform in the third quarter (Q3) of 2018, what did you do differently?

We managed to increase our advertising revenue by 29% year-over-year (y-o-y). We actually did not do things differently. These trends of revenue growth have been going on for several quarters, and this is the result of different efforts that we have been doing on our products. When you think about it, we wanted to make sure that we kept improving the value for advertisers, through better engagement and ad-relevance.

As a social media platform, we fully took advantage of the original investment for advertisers in terms of value – engagement and reach – and price.

It has never been clear what Twitter specifically brought to businesses, but we now know that Twitter has the most valuable and receptive audience. It is a message that we have been perceiving, and now the market is responsive to it.

Do you think that the current growth rate is sustainable?

For the remainder of the year and the year after, we are very optimistic about our ability to maintain our priorities and value for advertisers. Making sure advertisers will reach their audiences when they are most receptive is one of our priorities, so they can get better returns and engagement. We also make sure to build trust with our customers. In Twitter, we want to keep our leadership in terms of quality, transparency, and accountability.

Increasing ad revenue growth without affecting the quality of user experience is a challenge, how do you plan to keep this balance?

It is a very important point. We prioritise the platform users’ experience and the health of the conversation. When you look on Twitter, you need to think about what we are advertising on it—unlike other platforms—we only take content that already exists in public, and use our products to amplify it. As it is very selective, we are really far from ad saturation.

At the end of the day, what matters is the relevance of these ads, if we manage to present ads that are really relevant to users, we will know because they will engage them, unlike other social media platforms.

To summarise, first, we keep in mind the health of the platform, to ensure peoples’ safety, followed by content relevance. Second, we are working on our products to ensure that they add value to our users. Third, we keep a very close eye on how we think about advertising on Twitter, because advertising should not be a nuisance.

Data privacy was one of 2018’s controversies; as a platform how do you protect your users’ data? 

This controversy about data is linked to the health of the platform. Twitter is very unique because it is public, so when you think about the tweets on the platform, they are public and searchable. The majority of Twitter users choose to engage in public conversation, so any data we have is not private. It is very important to highlight that we do not provide any personal data, only the ones that are already public.

How can Twitter balance protecting freedom of speech and combat hate speech?

Improving the health of our platform is our main objective. We are fundamentally rethinking how the platform works, so that together we can increase the collective health, civility, and openness of the conversation on Twitter.

What are the latest developments about Twitter’s new verification standards? When can we expect it?

Verification was meant to authenticate identity and voice, but it was misinterpreted as an endorsement or an indicator of importance. We recognised that we have created this confusion and are working to resolve it. We have suspended all general verifications and we will report back soon.

For Arabic Twitter, can you tell us about the original Arabic programmes that were produced on Twitter?

Globally, when we are talking about our numbers, we mention higher engagement. We have a 9% y-o-y user growth, which is a good indicator. I am mentioning this because with local presence – like our regional office – we are making sure that we contribute to that.

In the Middle East and North Africa (MENA) region, we recognise the appetite for high quality and premium content. Taking into consideration that most of the region is actually talking in Arabic on the platform, we make sure that we provide programmes that add value to the users.

We introduced three Arabic language programmes that were produced by our partners. Twitter is not producing this content, we work with the best content producers out there.

In Ramadan, for example, we introduced a programme called #HawanahZein, which is an evening Arabic show that focused on what was happening in the Arab world on Twitter during the holy month. The show attracted an average of half a million viewers per episode.

During the FIFA World Cup, we introduced #YallaGoal, an evening Arabic show, which focused on football-related news on Twitter during the tournament. The show had an average of 400,000 viewers per episode. All in all, the show attracted a total of 10m video views, which included both the live episode and highlighted clips. In Egypt, this show had different people presenting the talk show, one of them was Hany Hathout, the famous Egyptian sports presenter, to make it more relevant to the region and Egypt. As Egypt is one of the most important markets when it comes to football, this show was filmed in Cairo.

Most recently, Sayidaty, a women fashion magazine, launched #FrontRow, an evening Arabic fashion series, that coincided with the Big Four Spring 2019 fashion weeks in New York, London, Milan, and Paris. The show generated an average of over 260,000 viewers per episode. All in all, the show generated a total of more than 6m video views, which included both the live episode and highlighted clips. This is the first live fashion news series to ever take place on Twitter—globally.

*Editor’s Note: live streams of fashion runway shows have taken place on Twitter but there have never been any fashion news series until this show was launched.

How much was MENA’s share of Twitter revenues?

We do not break down our revenues by country or region. However, we can say that Egypt is one of the top 20 fastest-growing markets globally. For the region, although I cannot share the exact number of revenues, I can tell you that we are at an all-time high.

How do you plan to increase Twitter’s penetration in Egypt?

When we think about Egypt, we know it is the biggest country in the region. Consequently if we want to grow on the long-term, we need to invest in this country, and that is something we have been doing through several initiatives. Earlier this year, we had a team working on Egypt’s presidential election, ensuring that the poll results were streamed to increase engagement. In all the world, not only Egypt, elections are usually a big driver of user growth.

During the FIFA World Cup, we had a content publishing team dedicated to the Egyptian national team, as we understand how important football is in Egypt, so we saw it as an opportunity for us. We made sure that the full squad were on Twitter. It was not only about Mohamed Salah, as the other players are important as well to the Egyptians. We had video highlights on the platform about what the Egyptian team was doing during the tournament, in partnership with Presentation Sports.

In the next year, there will be more programmes as well, bringing new users on the platform. On the advertising side, we have been working a lot with different organisations that can have an impact, such as the World Youth Forum in Sharm El-Sheikh.

When it comes to ‘Twitter moments’, do you plan to introduce country-specific moments?

Twitter is about what is happening in the world, more than something specific in a certain country. In Egypt’s case, ‘moments’ are curated for Egypt, however, some regional moments are also included, and the chronology of publishing moments varies based on whom the publisher is following.

You have recently conducted a study, have you shared it with marketers?

The study confirmed what we have already known, that Twitter users are more valuable, as people on Twitter usually aim to discover and engage with new content.

In Egypt, the study confirmed that Twitter is the best place to see ‘what’s happening’, to follow developments in real-time and to ‘see every side’.

In this study, Twitter wanted to better understand why its users are turning to the platform to see what is happening, and what makes their user experience unique. Watching news in real-time, as it happens, and being closely immersed in the action is one of the main strengths of Twitter, with 72% of users turning to Twitter for news (85% amongst daily users).

In terms of user experience, the findings revealed that people who want quality news turn to Twitter. Users in Egypt like to use the platform because news spreads faster on it (71%), they can follow developments in real-time (69%) and can ‘see every side’ of a story (72%). They are also heavily reliant on Twitter for news, when something is not discussed on Twitter, they question its significance (61%).

What are the latest product changes that you have made?

We keep on pushing a lot on videos, because today more than half of our revenues come from videos, so we keep on investing in it. We have also added the ability to stream audio only. What is interesting that we have seen that a lot of people used our streaming options for audio only.

Twitter has managed to remove a tonne of fake accounts during your latest campaign against the issue, will we see more removals?

As we discussed today, health is our main priority in Twitter, and removing spams is an essential step towards achieving this goal. This is not just a campaign, it is something that we will continue doing, and recently we introduced more measures to handle spams and data manipulation.

We have reduced the visibility of suspicious accounts, to ensure that it is not possible to artificially boost an account, and we have created an update to enforce the fact that every account must validate itself by using an e-mail and a phone number.

In terms of numbers, as of May 2018, we have identified more than 9m potential spammy automated accounts per week, up from 6.4m accounts per week earlier.

The post Egypt among top 20 fastest-growing markets, if we want to grow, we need to invest in this country: Twitter’s Middle East, North Africa managing director appeared first on Daily News Egypt.

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There will be no float of shares before mid-January 2019: Minister of Public Enterprise Sector Mon, 24 Dec 2018 06:00:47 +0000 I have agreed with minister of planning to put some of ministry’s assets in Egypt’s sovereign wealth fund, through two sub-funds dedicated for hotel management, real estate development

The post There will be no float of shares before mid-January 2019: Minister of Public Enterprise Sector appeared first on Daily News Egypt.


With the beginning of the new year and after six months in office, the Minister of the Public Enterprise Sector, Hesham Tawfik, said that the government initial public offering (IPO) programme that starts with the Eastern Company for tobacco manufacturing will not be initiated before the end of the holidays in January, since most of the clients are foreigners. During an interview with Daily News Egypt, Tawfik explained that the company will not be floated before the price reaches EGP 18.7 per share, adding that it will be difficult to set a deadline for the programme anyway following the delay that occurred in the

wake of the emerging market (EM) crisis. He also discussed an agreement with the health minister concerning the repricing of the medication by some companies in order to enable them to attain profits and restructure their companies.

Furthermore, he clarified the ministry’s vision and its goals in the coming year, such as reorganisation losing companies, settling the debts of the companies, and developing the different sectors of yarn, textiles, steel, fertilisers and others. The transcript for the interview is below, lightly edited for clarity.

The ministry of public enterprise has prepared a new business strategy. What are the most important features of this plan and what has been achieved so far?

We have 121 subsidiaries of eight holding companies. The business results for the fiscal year (F Y) 2016/17 indicated that there are 73 companies that profited EGP 15bn and 48 companies that lost EGP 7.5bn, which means that total losses reached EGP 7. 5bn. These 48 have been losing for years. The shareholders’ equity reached a negative of EGP 39bn. We penned a development plan for 26 companies in the first phase, which realised losses of EGP 6.7bn,accounting for 90% of the total losses of the 48 companies. We studied the strengths and weaknesses of these companies, and reached a conclusion for the restructuring of them. In addition to the 26 companies, we have others that profited but still need restructuring, investment, and vision to increase their efficiency and profits. We are talking about 40 companies out of 121 companies that we will focus on in the first phase.

We have already started the operational procedures to restructure these companies, based on consultants’ reports and recommendations in order to identify the steps to be taken. In general, we know what needs to be done, but there has to be a specialist consultant to individually examine the case of each company and determine what should be done and then float them to reach a full structure.

Are these consultants Egyptian or foreign?

We are dealing with a mix of local and international consultants, but the bulk of them are local. In the spinning and weaving sector, a US consultant has prepared a study of 11 volumes for the development of the sector.

What about the financing— the ministry has surveyed unexploited lands. How will they be utilised?

Financing will be through the exploitation of unneeded assets owned by companies. For example, there are a number of cotton ginning factories that are under developed and have been operational since 1894, but they are using more energy and outputting poor production, in addition to the lands.We have 25 ginning plants that are not needed, especially if we consider the new machines that will be imported. These will save energy and give better production. The number of plants will be cut to 11, then we will utilise the land of the other 14, which will return over EGP 25bn.

As for the land, we surveyed over 200 untapped assets. We are taking all the necessary step to sell these lands at a high value after changing their designated use. Most of these lands are assigned for industrial use and will be turned into residential areas. Funding will come mostly from the land sale. The public enterprise sector, is very rich in assets. There has

Minister of the Public Enterprise Sector, Hesham Tawfik been negligence in the past. We have currently put an end to it, and we are presently embarking on a radical development plan.

How will the land be sold?

The land will be sold through auctions carried out through companies under the supervision of the ministry. However, this will only happen after the completion of the most important step which is switching land use. We have set up a unit in the ministry that works particularly on this file, and they have called on real estate evaluators to quickly finish the assessment and to put up the lands in auctions as soon as possible.

When is the first auction expected?

The auctions will begin before the second quarter (Q2) of 2019. We will need about one and a half years to sell all the land plots. Most of these land will be sold, but part of them will be used on partnership systems, meaning that the ministry will bring in developers and contribute lands for the developer to carry out the development.

Following the sale of assets and land, what mechanism will be used for financing?

There are two levels of finance. The first level is that the same companies that sell some of their own assets will themselves use the sale proceeds to develop their subsidiaries. There will be no role

for the ministry here. The second level is that the sale proceeds will be used to develop the assets of another holding company. Hence the holding company that will sell its assets can reinvest through the development process by increasing its capital.

The ministry has exerted great efforts in the debt settlement file.What has been accomplished in this file and to what extent will the companies benefit from the settlements that will be made?

The total debts of the troubled companies to sovereigns bodies are about EGP 35bn. These are owed to several bodies, such as the ministries of petroleum, electricity, the National Investment Bank(NIB), the Egyptian Tax Authority and Social Insurance Authority.

There are agreements for settlement with three parties worth EGP 23bn, owed to the ministry of electricity, the

ministry of petroleum, and the NIB. We are targeting to sign protocols with the remaining amount over the next three months. Payment will be made in accordance to these protocols through a land swap mostly, and in some cases in cash. It has been agreed that the payment of any new commitments will be in cash. After paying these debts, companies will be able to recover their activity in a way that allows them to pay their debts and improve their financial structures.

The IPO’s file is one of the ministry’s most important files, and is at the top of the government’s concerns. But the conditions of EM and the stock market prevented it from taking off.When will the programme start, and when will the Eastern Company for tobacco manufacturing be offered or, more accurately, what are the price limits at which the offer is made?

We are now in a holiday season and

since the bulk of the potential investors of the Eastern Company are foreign, I cannot address them before the middle of January.There will be no float of shares in 2018. The price limits at which Eastern Tobacco will be introduced are EGP 18.7 per share.The current price is a little over EGP 17 per share, approaching the limit. When the share price hits EGP 18. 7 it should remain stable for some time. Then, the NIB will welcome the float.

The decision of the Cabinet states that the shares of the company offered for sale shall be sold according to the average price per share in the month preceding the contract with the NIB. EFG-Hermes has been hired in October, but the IPO was delayed. What will you do?

The contract will not change, and we are committed to the prime minister’s decision and to the average price in the month preceding the contract at EGP 18.7 per share. The IPO will not take place before share price reaches this value.

And what about the planned government IPO porgramme in general. Are there any changes in the list of companies being offered or the timetable for the IPO?

We have to wait to complete the first phase, which did not start yet, then decide. We do not yet know when the first stage companies will be offered. Therefore, a certain period of time cannot be set, it will be determined according to the stock market situation and EMs. It may take longer, hence a need might arise to reschedule the IPO. With regard to the companies listed, after the first phase, a list will be made for the second phase, which will include 10 companies. At that time we can review the list. So far, there is no change in the plan, or more precisely, when we finish the first stage, we can determine whether there will be a change or not in later stages.

With the ministry of finance needing funds at the moment, especially with its external commitments and delaying the disbursement of the International Monetary Fund (IMF) tranche for December? Will the government bring forward the IPO programme ?

The money that will be raised from the offering of companies is only a drop in the ocean. The purpose of the sale is not financial as much as it aims to raise the efficiency of companies by increasing the contribution of the private sector, as well as attracting equity financing for the companies and will also help expand the Egyptian stock market’s capitalisation. The secondary objective is to support the state treasury.

How will the raised funds be used?

The main target is to allocate the money to holding companies. For instance, Eastern Company is a subsidiary of the Chemical Industries Holding Company, which is indebted to other subsidiaries and will need money to repay these debts. There is another dimension, namely, that these funds go to the ministry of finance, if the holding companies that own the shares do not need the raised funds.

Privatisation has a such a bad reputation in Egypt. Is the ministry worried about the resale of companies to the private sector?

Privatisation is the right word for companies exiting the public sector and entering into the private sector. But I want to explain something important, this bad reputation resulted from the fact that many companies privatised in the early nineties have had problems and these problems stemmed from being sold to a strategic investor—that is, the seller did not follow the necessary procedures to obtain the highest price, or proper procedures to maintain the company’s activity. Many strategic investors who bought public sector companies had the right to take assets, liquidate the company, and sell the assets.

Now the situation is different, the new programme is basically a public offering on the stock exchange. The exception will be the presence of strategic investors, which did not happen until now. If that happens, though, it will be done with restrictions to ensure that the investor continues running the company. This is the difference between old-time privatisation and today’s.

How will you address fears of workers with the return of privatization?

We are in talks with all concerned parties, and we involve them in the stages of the appropriate decision making process of the companies, to ensure the interests of the state, while maintaining the workers’ rights. We also reviewed the ideas of union leaders on the reform and development of companies. The ministry issued instructions to the holding companies to abide by what has been agreed on and impose Law No 96 for 2018 related to granting bonuses for employees of the holding companies

and their subsidiaries. The bonuses of holding companies’ employees exceed, under this law, the minimum set for government employees. This was welcomed by union leaders.

What are the steps taken to address the returning companies to the ministry’s ownership?

There are two special cases in this file so we have started with them, the Nile Cotton Ginning Company and Omar Effendi. With regard to the Nile Cotton Ginning Company, we focused on solving this situation because it belongs to 5,200 investors that have been ignored by the government since 2011. We talked with them and reached solutions to implement the return verdict and enabled them to free their funds and compensate the government. In this case, we will return the shares to their ownership and the company will belong to them. They will hence be free to sell the assets and the lands since the company stopped production. But the most important thing in this agreement was the basis of selling the land. It was agreed to evaluate the lands now using the residential use evaluation and the industrial use evaluation then use the price difference to compensate the government. That way, the verdict will be enforced, and helped investors to free the company and its assets.

For Omar Effendi, the company is in our possession and under our management, yet it has been crippled in losses for 10 years. The company has debts to local and foreign bodies, which have increased. The management was able to reschedule the loans and lower the interest paid. A few days ago, we witnessed the signing of an agreement to settle the dispute between the company and the International Finance Corporation concerning the indebtedness owed to the corporation, as well as its share in the company’s capital worth $35m. This was a huge burden on the Holding Company for Construction and Development that managed the company. If no real estate development takes place for the company, it will be very difficult to revive it. After finishing these two cases, we will deal with the remaining cases.

The ministry adopts a different approach to losing and low-profit companies? Will we witness new mergers and liquidation in the coming period?

Merger is exception, not a general solution, and we only resort to them when the company’s case calls for it. For example, we have three public transport companies under the Holding Company of Maritime and Land Transport. For the world, these are just lines merged in one company. Foreign trade companies should also be merged to save expenses. When there is an incentive for a merger, we will do so.This does not mean turning a corner towards profitability, as it will

need more plans to restructure companies. As for the liquidation, only one company, the National Company of Cement, was liquidated. This was the last solution when there were no other alternatives. We resorted to this decision after making sure that it is useless to inject any investment or undertake any development to reduce losses.

El Nasr Automotive Manufacturing Company is also one of the important files at the ministry’s table, especially with the dream of manufacturing an Egyptian car.There have been talks for a global partnership. Have you received offers yet?

We seek and strive to have a global partner like the situation in Morocco.We are talking with the ministries of industry and investment to reach a global partner and target export mainly.We sat with one of the world’s biggest companies last week to talk about possible partnership. We have not yet received any actual offers. But there is a need to turn Egypt into a base for manufacturing and export. Instead of concentrating on automotive assembly, we want to add local value to manufacturing. This will only happen by directing production to foreign markets. Hence, our goal is to attract an investor who does not want to manufacture only for the domestic market, but also wants to target external markets. El Nasr can be the base that will be used by the partner investors for manufacturing and exports. There are calls for Egypt to manufacture cars and it is possible that El Nasr may play this role. Hence, it is our goal to choose the right partner. El Nasr is a gem that will be retained for a partner capable of producing 50,000-60,000 cars per year. Despite the company’s annual losses marking EGP 12m, when I visited the site, I expressed my admiration for them, and the maintenance of equipment in the best form.

What are the criteria for choosing a foreign partner?

We will choose the foreign partner on a technical basis. And the deal would be a partnership contract, based on the sharing of profits and not a contribution rate. For example, the goal is currently to produce100,000 cars, but if production is only 3,000-5,000, we will then terminate the partnership and impose a fine as stipulated in the contract.

What about the merger of El Nasr with the Engineering Automoative Manufacturing Company (EAMCO)?

The merger may be determined by the global partner we are looking for. The merger is an exception to the rule and only when there is an incentive. If we agree with an investor to produce 60,000 cars, then we may discuss a merger as the capacity of El Nasr alone cannot achieve that goal.

There is always a confusion between the role of the sovereign wealth fund and the role of the ministry. Can you summarise the difference?

There is no conflict between the role of the fund and the role of the ministry. Egypt’s Sovereign Wealth Fund aims to invest the unexploited assets as well as developing the exploited ones. For example, a company that has a land can

contribute it for a project and Egypt’s Sovereign Fund can finance this project, or it can also buy the entire land. The role of the fund is preserving the rights of future generations in the public assets. It will be specialised in investing and developing unutilised assets. There may be cooperation between the ministry and the fund to exploit the assets of any company. I have already agreed with the minister of planning to put some of the ministry’s assets in this fund, through two sub-funds as a start. These sub-funds will be dedicated for hotel management and real estate development.

What is the ministry’s plan for the pharmaceutical companies and the problem of medication pricing?

We have a big problem in these companies, as they are losing. There were 570 pharmaceutical products losing in the public enterprise sector. We agreed with the minister of health to reconsider the pricing of medications. The types of medicines produced by these companies are not produced by the private sector and we produce them at very low prices of EGP 1-10.

When production stalls, the private sector imports the medicine at five or seven folds the price. So, we offered to provide them at reasonable prices in order to make some profits and continue production. The ministry of health started to fix the prices. We managed to achieve profits that en- abled us to invest in the development of these companies. There is a plan for exporting to Africa and Arab countries. Here, it should be noted that pharmaceutical companies’ restructuring

plans are worth EGP 750m and will all be funded from untapped assets.

Where is the development textile sector currently standing?

Only nine of 23 textile companies in the sector lost EGP 2.7bn, which is the biggest loss in the ministry’s companies. Holding companies have conducted a detailed study with a global consultant,which identified the needs of the 23 companies in terms of machinery and ginning equipment. Therefore, we decided to start with some companies which represent 60% of the factories we have, and to complete that in the coming one and a half years. We will renew all the machinery and begin producing for profit. This includes the Mahalla Textile Company, Misr Fine Spinning and Weaving, Kafr Al-Dawwar, Misr Helwan Spinning and Weaving, and Damietta for Spinning and Weaving. A plan has also been put in place to integrate com- panies into 10 instead of 23. There will be three major industrial complexes that will be the foundation for the industry starting from spinning to garments in Mahalla, Kafr Al-Dawwar, and Helwan. And we have already started to work out a plan for the entire industry with unprecedented investment figures over the next three years, in order to modernise the entire industry. Some factories will have equipment from the best sup- pliers of machinery in the world, at an estimated cost of up to EGP 25bn.

What about the development of the Egyptian Iron and Steel Company?

An international consultant made some recommendations to assess the condition of the furnaces and determine the actual development required, which we have done. We started operations at a maximum capacity of 420, 000 tonnes and will stop in January for the consultant to re-evaluate the situation.

We hope that there will not be major damage so that we can begin the tender procedures. We will not make direct offers, but will do so through a tender, even though some companies, including Russian ones, are offering to be involved in the development process.

Can the Egyptian Iron and Steel Company face the same fate of the National Company of Cement?

We are keen to develop the Egyptian Iron and Steel Company. We have been operating the furnaces at full capacity for four months now, based on the consultant’s recommendation to evaluate their condition and prepare an integrated plan to develop the company. The position of the development project will be evaluated in February to ascertain the technical and financial feasibility. This plant was built in the 1950s. Until 2008, the company was profiting, even if poorly, due to the old age of machinery. Yet, since then, the company starting incurring losses, due to the variables of prices of energy and row materials. In 2014, the company hired an international consultant to study the development potential.

The tender was floated in 2017 but was suspended to renew the study. On 17 August 2018, we received the new results that indicated that the condition will be very different from 2014, so we cancelled the tender.

What about the development of employees and management systems?

In addition to investment in machinery and equipment, we are focusing on investment in human resources. We aim to automate business within companies through the system of planning and management of resources (ERP).This is a system that can be used to significantly raise efficiency. The private sector adopted this system 30 years ago. We aim to apply it in 70 of 120 companies, which are the companies whose sizes will enable us to spend that much on development. The other companies are small, so it will not be feasible to introduce this system into them. A tender for the consultancy job will be opened on Sunday. Then, we will begin preparing the specifications and prospectus to begin implementing the project in Q2 of 2019.

We also established central marketing and sales departments in holding companies.With the exception of a few companies with marketing units, many are still unable to market their products, which reduces their ability to attract marketing staff.

What about the ministry’s mandate to the housing companies affiliated to the Holding Company for Construction and Development to submit an action plan for the development of 50% of their land portfolios?

Companies are going at a good pace in this file. The companies submitted their development plans and they are currently being reviewed. Heliopolis Company for Housing and Development will not report to us but to the board of directors, being part of the IPO programme. It will then be a joint company. We will be only shareholders with 30-40% of the company.

There was a proposal from the Egyptian Capital Market Association to re-examine the stamp duty and capital gains.Where is this standing now?

Stamp and capital gains taxes are under discussion with the ministry of finance and we expect to reach a final decision soon. The ministry of finance is responsible for this file, but I act as a mediator because I have an industrial experience.

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Egypt informal settlement-free by 2019, quelling it fully by 2030: executive director of ISDF Khaled Seddiq Sun, 23 Dec 2018 10:00:47 +0000 President Al-Sisi cited decree to consider NUCA’s budget surplus as new source of funding our projects

The post Egypt informal settlement-free by 2019, quelling it fully by 2030: executive director of ISDF Khaled Seddiq appeared first on Daily News Egypt.

In his election programme, President Abdel Fattah Al-Sisi, in first and second term, has undertaken the task to eradicate one of the most significant and critic problems in Egypt which are informal settlements.

Beyond any doubt, this undertaking is close to becoming a rality, especially, since the Informal Settlements Development Fund (ISDF) has announced that Egypt will be slum-free by 2019.

In an interview with Daily News Egypt the Executive Director of ISDF Khaled Seddiq unveiled the amount of funds that were allocated to reach this goal, in addition to how Egypt will be reshaped by 2030 in this respect, the transcript for which is below, lightly edited for clarity:

Is it true that Egypt will overcome one of its most significant obstacles which is the informal settlements issue?

That is correct, Egypt will be slum-free by the beginning of 2019, according to the schedule which was set by the ISDF, in cooperation with all concerned bodies.

However, some people and concerned persons debate this fact, considering it as an impossible goal. What do you say?

It is not impossible any more, and all these allegations are not true, especially that we developed quite a number of informal settlements all over Egypt.

So, how will you reach this achievement?

We have already finalised 102,000 housing units, in addition to other 93,000 units which are under-construction. Furthermore, we will inaugurate a number of housing units in four concessions in Port Said, Beheira, the Red Sea, and Sinai governorates, in addition to the third phase of Al-Asmarat housing project that will be inaugurated during 2019.

And what about Cairo in particular?

Cairo needs about 40,000 housing units to be built to eliminate all types of informal settlements, especially unsafe settlements, and these units will be completely established by 2019. The Al-Asmarat zone includes in its three phases 18,500 units. In addition to the ‘Ma’an’ housing project which offers 4,500 units, and Al Mahrosa housing project which includes 4,900 units. Moreover, the Ahalina housing project offers 1,200 units; 6,800 housing units which are built in the ministry of military production’s housing project, beside the Khairallah housing project that offers 2,520 units. In addition to 1,000 housing units that we will build for the people of Maspero Triangle zone inside the zone itself.  All these efforts are enhancing our plan to make Cairo slum-free by 2019.

That’s for unsafe settlements, but what about for un-planned ones?

Egypt contains 32 cities over 417,000 acres,160,000 from this space are unplanned areas which shape 40% of Egypt. These areas lack infrastructure like roads, sewerage systems, and all kinds of utilities. It requires £350bn to develop it completely by 2030.

One of your goals is to improve the Maspero Triangle zone, can you elaborate?

Although the project of improving the zone was set to begin by 2019, we decided to buy some time, thus, we have begun during 2018. We have already torn down all buildings in the area. In addition, constructing firms have begun their work, and are implementing the area’s development project.

What is the expected time frame to completely improve the area?

Within three years, so by 2021, the residential area will be completely established. 1,000 families will be resettled there over an area of 6.5 acres.

But the residential area was set to be on 11 acres, why has is decreased?

Because, we decided to increase the heights of the apartment buildings, thus, we horizontally decreased the area.

And what about the rest of the area, and the projected investments there?

It is not a matter concerning the ISDF authority. It is a matter related to the owners of land spaces inside the area and the bodies that will offer those facilities to implement their projects.

But you must certainly have a vision in this regard according to the construction proposal?

It will include entertainment facilities, services, commercial activities, and some hotels. Investments in the area will reap profits from these activities. Additionally,, the residential towers will not exceed 30 floors which the investors will build there.

What is the budget that is allocated to improve this zone?

About EGP 1bn, in addition to contributions from investors.

Who are the incumbent owners there?

Six big owners, including two Saudi companies; Maspero company which owns the building of Radio and TV Union; a holding company followed the business sector; an Armenian Church; an owner of a space of land inside the area called Diob, in addition to some small holders.

But there is also a Kuwaiti company, correct?

Yes, but, unfortunately, the Kuwaiti company, which owns about 42,000 metres, and another owner called Jan Eid, who owned a space of land inside the area, have not yet introduced any of documents which proves their ownership. Therefore, according to the building code, we have set out to take all procedures towards expropriation, and these spaces of lands will become state property subject to the New Urban Communities Authority (NUCA).

What about the project of transferring informal local markets outside Cairo which has been set since 2015?

This project has been cancelled, as if we transferred these markets outside Cairo, inhabitants would not have coped with this situation, and it would have been a hard situation for them. Moreover, transferring them will maximise the phenomena of informal markets, as citizens will create an informal market to meet their demands.

What about the new project?

The new project aims to establish a formal and organised new market as a replacement for every informal one in its closest zone to meet all the demands of customers and buyers alike. For instance, we established the new Tunsi market, as a replacement for the old one, about 500m from its previous location.

What is the number of informal markets all over Egypt?

There are 1,103 informal markets all over the state; 134 markets in Cairo; 84 in Alexandria; 83 in Giza, 55 in Sharqiyah; 69 in Menya; 82 in Sohag, and we classified them into three types: annual markets, weekly markets, and daily markets.

What are the effort that the ISDF has introduced to improve them?

Thirteen new markets have been established, 24 markets are under construction, and 26 informal markets are under consideration.

What is the source funding all these efforts improving both informal settlements and markets?

From the general state budget, but President Abdel Fattah Al-Sisi issued a decree to consider the NUCA’s budget surplus as a new source of financing our projects. That decree come into effect as of the fiscal year (FY) 2016/17.

Is the private sector sharing in this regard?

The Tahya Misr Fund is contributing with £1bn, while National Bank of Egypt NBE, and number of businesspersons are contributing with £ 600m, and the Ma’an Foundation is contributing with £ 275m. But we do not accept any kind of pledges.

What is the budget that was set to eliminate all kinds of informal settlements?

Over £ 20bn. It hits EGP 15bn in FY 2018/19. During a period of six years, from the beginning of the ISDF work in 2008 until 2014, the total expenditures to improve slums had reached EGP 652m, then, from 2014 to 2018 expenditures in this regard exceeded EGP 12bn, besides a share of EGP 2bn has been spent by citizens as an effort to improve their areas. In FY 2015/16 the budget recorded EGB 1.5bn, while it was doubled to reach EGP 3.5bn in FY 2016/17. In last four years the expenditures volume on improving informal settlements hit twenty times what had been spent before 2014.

What is the key factor that drives the ISDF to deal with this critical issue?

The attention payed by President Al Sisi to this sector, and his instruction to all concerned bodies to offer all facilities in this regard is the key role that will help Egypt to become slum-free by 2019. Dealing with this issue in previous times happened by accident, I mean when a disaster occurred the concerned bodies would move to act without a strategic plan in the short and long run. Currently, on the contrary, we have an integrated plan and we are close to achieving a complete overhaul in the informal settlements issue.

Does this sector need a ministry to be dedicated to deal with it?

There is no need to dedicate a ministry for this sector. This issue needs more interest to be paid to it and a will to go ahead. And, when all these factors were available, in addition to the required fund, we were able to make a significant headway.

According to Egypt’s vision 2030, what is the projected situation of slums in the country?

By 2030, Egypt will be completely slum-free, and all unplanned areas will have improved, in addition to all informal markets. In 2030, Egypt will be reshaped.

For private sector, what do you have to tell them?

I call on all businesspersons to invest in improving districts and cities. In this regard, the ISDF launches an initiative through the Daily News Egypt offering them designs, eliminating fees, in addition to getting licenses from concerned authorities to stimulate them to become member in improving our country.

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RMG exports to hit $1.6bn by 2019, attracting 300 new exporters: says head of RMGEC Sat, 22 Dec 2018 17:25:28 +0000 Optimistic for the future of Egypt’s economic growth and the performance of the sector, Head of Ready-Made Garments export council, Mohamed Al Sayad, said that the RMGEC’s exports can hit $1.6bn by the beginning of 2019, benefiting from all incentives that government is offering to boost exports’ performance, as well as undertaking economic reforms. In …

The post RMG exports to hit $1.6bn by 2019, attracting 300 new exporters: says head of RMGEC appeared first on Daily News Egypt.

Optimistic for the future of Egypt’s economic growth and the performance of the sector, Head of Ready-Made Garments export council, Mohamed Al Sayad, said that the RMGEC’s exports can hit $1.6bn by the beginning of 2019, benefiting from all incentives that government is offering to boost exports’ performance, as well as undertaking economic reforms.

In an interview with Daily News Egypt, Al Sayad warned that this optimistic vision might not become a reality due to the serious challenges which the sector faces. Adding that the RMGEC prepared a strategy aligned with Egypt’s 2030 vision for sustainable development, to attract more exporters and get more funds from all the financing bodies.

From your perspective, what are the challenges facing the RMG (Ready Made Garments) sector which affect its performance?

The government lacks steady and timely payment of export subsidies, in addition to the dramatic increase in production’s costs since the floatation of the Egyptian pound in November 2016. Furthermore, between 50% – 60% of raw materials’ costs, used in the manufacturing processes, are imported from other countries, as well as the increasing prices of energy resources that caused a rise in the costs of transportation. All these are burdens and challenges which the sector faces now.

What about the financing facilities which are offered by the banking system?

Unfortunately, the banking system in Egypt classifies the RMG sector as a high-risk activity, thus there aren’t any financing programmes to our projects, and the sector lacks credit facilities.

To what extent do these conditions impede you from preparing a strategy to boost the RMG exports according to the government’s directives?

We have already papered our strategy, dealing with all the surrounding challenges. RMG is a labour intensive sector and one of the main axes of Egypt’s 2030 strategy for sustainable development. Egypt’s location qualifies it to be a logistical hub for the textile industries and products, importing them to Africa, along with the free trading agreements that Egypt signed, linking it with a big number of countries, as well as the real incentives that the new investment law introduced. All these steps can push the sector to be one of the most beneficial economic sectors in Egypt.

Can you clarify your council’s strategy in details?

We aim to achieving four goals, including increasing the RMG exports by 10%, to reach $1.6bn by the beginning of 2019. The second goal is to increase the number of small and medium class exporters to reach 300 exporters, and to promote our RMG’s exports through participating in specialised expos and promotional missions especially to the USA and European countries which occupy 85% of the Egyptian RMG exports. The fourth goal is to increase the number of the sector’s labour from about one million workers, to 2 million workers by the beginning of 2019.

What are the tools that will allow you achieve this plan?

This could be carried out through working on expanding the exporters’ base by attracting small and medium companies, and by opening channels in order to obtain all forms of finances from funding bodies. In this context, we have already succeeded in attracting about 25 new factories to the sector.

Have you searched for alternative ways to achieve the above mentioned plan?

Well, in coordination with some institutions, the council succeeded in offering financing and training facilities to exporters in order to double the Egyptian RMG exports. Therefore, the RMGEC, in cooperation with other eight exports councils, signed a protocol of cooperation with Banque Misr, trying to offer finance solutions to help exporting companies expand their activities, and to offer technical support for them. Moreover the RMGEC, in cooperation with other nine exports councils, signed another protocol of cooperation with the Export Development Bank of Egypt, and the Egyptian Businessmen’s Association providing concessional funds, benefiting from Central Bank of Egypt’s initiative for SMEs’ financing.

*What are your destination markets for exporting RMG?

USA is a top destination, with a value of $646m, rising by 7% from 2017. European countries follow with a record of $444m, rising by 11%, compared to 2017, and Spain is the highest European country with a value of $118m, Germany with $77m, France with $44m, while our exports to turkey record $116m.

What about the delayed dues that the government owed to exporters including the RMG ones?

The Minister of finance Mohamed Moeit announced that the government will allocate EGP 504m to boost the export support fund. Thus, all funds were allocated in fiscal year (FY) 2018/19 within the last few months till mid-November, recording EGP 1.2bn. Moreover, the ministry of finance and all the concerned bodies always express their support to the exports sector, and take all procedures to lift the barriers facing the sector. We hope that all these steps lead to an actual support for the exporters, and allow us obtain the delayed due from the government. According to Moeit, we will get the first tranche by the end of the current FY.

What are the tools that could maximise the benefits of your strategy?

Through economic reforms aiming to achieve inclusive and sustainable growth, and increasing competitiveness, in addition to enhancing the investors’ confidence in Egyptian economy, along with stimulating the economic growth, boost the exporting sector in general, and the RMG sector in particular, we will be able to perform well by 2019. This is in addition to the laws which the state set to boost the investment environment, and increased investment in infrastructure projects, especially in mega projects including the National Road Network, the Suez Canal Area Development Project, as well as establishing new cities.

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NGO management should have mentality of private companies to maximise resources: PDF vice chairperson Wed, 19 Dec 2018 10:00:23 +0000 Civil work should push national projects towards success

The post NGO management should have mentality of private companies to maximise resources: PDF vice chairperson appeared first on Daily News Egypt.

Civil work in Egypt is a main pillar for development for both the private and public sectors. There are over 40,000 NGOs in Egypt and they naturally compete among each other. One of those NGOs is holding currently an excellence contest between a number of NGOs to present their projects and win major prizes with the aim to encourage civil work in Egypt. Daily News Egypt interviewed Tamer Badawy, vice chairperson of the Professional Development Foundation (PDF), to learn more about this contest and its conditions.

Where did the idea of organisation come from?

It started in the 1990s when we noticed the major gap between graduates of Egyptian universities and the requirements of the labour market, so we wanted to bridge it through training programmes with international institutions and we managed to reach agreements in this regard. The success rate of recruiting employees was 90%. Then, we started paying attention to training employees in various sectors in order to have them keep up with the global management systems.

Does the organisation focus on training only?

No, but it is a major part of our focus. We believe civil work is the third pillar of development and supporting civil society will be reflected on the entire state.

What are the aspects on which you focus in NGOs?

We believe that managing NGOs must be done with the same system of the private sector, which means more focus on efficiency. The private sector knows how to choose its employees and make profits. The civil organisation sector mainly relies on donations, which are not enough. The financial resources of such organisations must be developed.

Is not civil work based on volunteering?

Of course, for example, right now I work as a volunteer, but when I worked in a civil organisation, I received salary that suited my experience. Successful organisations must hire employees who have the efficiency needed. Everyone who works for us has an experience in either the private or the government sectors in his specialty.

How did the organisations cooperating with you benefit from this relation?

We have programmes prepared and given to NGOs to benefit from. Forming cooperation networks among NGOs serves very important common objectives. The response to our programmes was great.

Where did the idea of the excellence competition come from?

It stemmed from the same philosophy we rely on. We know that competitiveness contributes to success globally and always develops businesses to present better service at lower prices. This is was the idea of the competition which we presented to the Minister of Solidarity, Ghada Waly, and she was very enthusiastic about it. This is the third year for the prize.

What is the criteria for choosing winner organisations?

We have a clear criteria for evaluating organisations. We have two arbitration committees. The first is specialised in the civil work and the other includes legal experts.

Do you intervene in choosing the winner?

I only manage the process. We collect the projects of different organisations, but the specialised committee evaluate them. We have nothing to do with choosing the winners.

How are these committees formed?

We hold internal discussions to choose the members of the committees. They should include high-profile figures known for their integrity and have good reputation, as well as representatives of the ministry of social solidarity, being the governmental body responsible for supervising civil work in Egypt.

How did NGOs react to this competition?

During its first year, 140 organisations applied, 250 in the second year, and 350 this year. These numbers do not meet our ambition, even though they do increase every year. We hope to take the number to 1,000 NGOs, and instead of giving prizes to the first three winners, we aspire to make a list of top 10 NGOs in Egypt.

What are your plans for this competition in the next few years?

We hope to see more organisations participating in the competition and attract more sponsors because we only have two now. We want the private sector to contribute more to the competition.

Do you see that the number of civil organisations in Egypt, estimated at 40,000, is huge?

We must make two very important points clear. First, this figure is not big in a country like Egypt. I have been in France recently and I carried out a survey on the civil society there and found over 2m NGOs.

Second, we must consider the effectiveness of these organisations and the actual services they offer to the society. The active organisations would not be more than 2,000. In contrary, all the organisations abroad are effective. I hope we have 100,000 or 200,000 NGOs in Egypt.

Do we have a welcoming culture for civil work in Egypt?

There is a problem in how the role of civil work in Egypt is perceived. The sector was launched a long time ago, but very unorganized. I hope to see more students in civil work activities and benefit more from them, given that they would come up with projects that benefit the society.

Can NGOs be managed similarly as profit companies?

There are some similarities between the two sides, however risks is part of the private sector’s work, unlike civil work. Funds cannot be risked, so organisations cannot really put their funds in stock market. Even though, the Egyptian law regulated this issue, so NGOs can establish joint corporations with the private sector in certain activities. They would not cost a lot but will achieve good revenues for civil organisations.

Do you work in these activities?

We have already cooperated on several educational programmes with universities like Harvard. As we are a civil organisation, we obtained and offered the programme at low prices in favour of the society. We injected the profits into the organisation’s other activities. Donations, important as they are, could suddenly decline or stop as was the case in 2011.

Why do you pay special attention for education and training?

Developing human resources is one of the most important steps to guarantee sustainable development. Investing in humans is the best investment to be made.

Why the organisation stopped recently?

Because we found that the state became aware of education and training sector and has started to develop it, so now we are more concerned with developing civil society because we believe it is the future.

Why many training programmes failed?

Because they focused more on the theoretical side, without specifying certain skills to be mastered. They did not give much attention to the feedback. In training for specific skills is important to provide workers with better work opportunities. Short and long term strategies are also important in that case.

What do young people need in Egypt in order to be qualified for the international labour market?

They need to read. Young people must educate themselves instead of relying on the private or public sector to do so. They must rely on themselves. Academic degrees do not do much now, and large companies do not really care about the degree you received and care more about your skills and capabilities.

Have you taken part in the state’s development projects?

Of course, this is one of our main priorities, because it gives us as well as the state’s projects a good push instead of letting everyone work in isolation.

Was this your strategy in a specific project?

Yes, in the development project of the Suez Canal Economic Zone, we thought about training students from Ismailia, Suez, and Port Said to have the logistical skills required for such a project. We ended up training a number of individuals a needed by the project. We also trained employees from the Federation of Egyptian Industries (FEI).

What are the obstacles standing in the way of civil work in Egypt?

The NGOs law was one of the major obstacles. We were pleased when the president demanded making amendments to the law. It has hindered many projects with foreign partners, and we had to adhere to it, but we were glad it would be amended. The second obstacle was the mentality of those working in NGOs and their way of management which should change.

What do you expect from these amendments?

Quick and flexible working mechanisms. This is all we ask for, alongside more control and transparency.

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More investments, promotion required to boost Egypt’s presence in Africa Tue, 18 Dec 2018 10:30:54 +0000 Ambassador Gamal Bayoumi, secretary-general of the Arab Investors Union (AIU), said that injecting more direct Egyptian investments in the African market will significantly help in boosting Egypt’s presence in the continent. He added in an interview with Daily News Egypt that Egypt must take real action on the ground, not only organising events, to succeed …

The post More investments, promotion required to boost Egypt’s presence in Africa appeared first on Daily News Egypt.

Ambassador Gamal Bayoumi, secretary-general of the Arab Investors Union (AIU), said that injecting more direct Egyptian investments in the African market will significantly help in boosting Egypt’s presence in the continent.

He added in an interview with Daily News Egypt that Egypt must take real action on the ground, not only organising events, to succeed in this regard.

How do you evaluate Egypt’s movements towards tightening its relations with Africa?

President Abdel Fattah Al-Sisi has taken important steps in sake of reviving Egypt’s role in the continent. His keenness to visit many African countries and boost relations with their presidents and leaders will work in favour of Egypt as a leader in Africa. It will also support Egypt’s position as the coming president of the African Union (AU).

What are the other concerned bodies in this regard?

The roles of executive bodies is as important as Al-Sisi’s. They must work hard to ensure the success of Egypt in its presidency of the AU. For instance, all joint committees between Egypt and African countries must convene regularly, and all concerned bodies should prepare suitable proposals to achieve Egypt’s strategy in Africa.

How do you see Egypt’s coming presidency of the AU?

It is a significant leap in Egypt’s continental relations, and a sign of African countries’ respect and confidence in Egypt, especially that AU had suspended Egypt’s membership in the union in the heels of 30th June uprising. I can say that Egypt’s presence has been revived strongly.

Egypt held a number of events related to Africa, do you think these efforts can boost Egypt’s position in the continent?

All these efforts are appreciated but entering the African market requires real actions. What caught my attention in the latest Africa 2018 Forum was the President Al Sisi’s announcement that Egypt will establish a new fund to protect investments in the African countries. This was an ideal action that sends a message to all Egyptian investors to enter African market without fear of any business risks. Furthermore, he instructed all concerned bodies to take serious procedures to establish the first entrepreneurship regional centre to cope with all investors’ and entrepreneurs’ concerns.

What is required for Egypt to succeed in its mission?

Egypt should open branches of its government and private banks in all African countries to introduce financial and credit facilities. Egypt also must pay more attention to establish new roads to link Egypt to its African neighbours. During 2019, Egypt have to organise not less than fifteen conferences in some of African countries, at both political and business levels, for promoting Egypt’s potentials to invest and establish integrated business.

For Egyptian embassies in African countries, what are their roles?

Also, Egyptian embassies should play a role in promoting Egyptian commodities and setting plans to attract Egyptian investments to African countries.

Regarding COMESA, how did Egypt exploit the event to tighten its African relations?

Unfortunately, we have not paid enough attention to this important agreement although it has been valid since 2000. This agreement has succeeded to double Egyptian exports to the African market over the past 18 years. We must know that one of the significant merits in dealing with African and Arabic markets is achieving trade balance surplus, thus, it is worth to be tapped.

What is your advice in this regard?

Leading Africa requires more direct Egyptian investments. It is a key step to boost the country’s presence in the neighbouring African states.

The post More investments, promotion required to boost Egypt’s presence in Africa appeared first on Daily News Egypt.

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Current media system needs real reform to play its role in enlightening Egyptians: Abdel Aziz Mon, 17 Dec 2018 16:40:34 +0000 Egypt needs “A councils of minds” to discuss, develop solutions to challenges facing country

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Samy Abdel Aziz, former dean of the Faculty of Mass Communication at Cairo University, said that the current media system needs real reform in order to play its role in enlightening the Egyptian citizens on the Egyptian news and issues, as well as informing the people of what is going on in the world.

In an interview with Daily News Egypt, Abdel Aziz said that the people are mainly concerned with the vagueness and rumours about some issues which recently spread. He questioned the media’s role in answering the citizens’ questions about the economic issues such as the living conditions, price hikes, and the economic reform programme. “I did not see any media person discussing such matters in a professional manner, in order to raise the peoples’ awareness and reassure them on the state’s policies and procedures.” The media system also lacks efficiency when it comes to the media hosts, as well as a lack of information and studies to discuss the emerging issues, thereby providing mediocre information to the audience, leading to low viewings rates.

He also stated that the success of any media system requires the training of everyone working in this field, as well as establishing centres for research and studies, in order to provide material that serves the media work, or to monitor and analyse the media programmes’ contents, evaluating them neutrally.

The former dean pointed out that the application of institutional and professional values in the media’s work will save us the need to have media ‘codes of honour’, and this is well-known and applied in global media systems.

He said that the reform, being carried out by the state’s media institutions, does not meet the required standard. Those media institutions need professional mindsets with plans and programmes, as well as powers to implement them.

Furthermore, Abdel Aziz said that Egypt needs “A councils of minds” to discuss and develop solutions to the issues and challenges facing the country, and raise it to the political leadership to submit them to the government in order to be implemented. Governments implement what they are tasked from the political leadership and, in this case, the solutions will be raised by experts and specialists, as well as by leaders, with the government entrusted for the implementation.

He called for reconsidering the method of selecting and appointing leaders, and to follow a scientific approach by interviewing the candidates for leading positions. Leaders should have a strong plan of action to skilfully manage their teams, thereby providing them with more power and authority, while, at the same time, being accountable to the public opinion, with their performance evaluated by the citizens.

He questioned the advantages of having 33 ministries, while many of these ministries can just be an entity or a council instead, in order to rationalise the expenditures and curb the existing bureaucracy.

Abdel Aziz declared that there should be a mechanism that guarantees the presence and continuity of trainings in the various sectors, in order to ensure the efficiency as well as performance development. He praised the banking sector as one of the leading sectors which believes in the importance of training for its employees in different grades. This policy is confirmed by the Central Bank of Egypt (CBE) since the implementation of the banking sector’s reform programme under the former Governor of the CBE, Farouk El-Okda, and continued by the current Governor, Tarek Amer.

Moreover, Abdel Aziz criticised the inaccuracy of Egypt’s investment map, and said that it does not reflect Egypt’s investment needs, and the country’s natural resources, stressing that the absence of data and information is one of the most important investment problems in Egypt, highlighting the role played by the Administrative Control Authority, in the preparation of a database that serves the real investor and decision makers.

Abdel Aziz added that the absence of information and data made us suffer from many problems, and underestimated our capabilities, making us unable to advocate for our country. He stressed the importance of working in a team spirit, and following scientific approaches in management. “We should also choose the Egyptian professional minds, who are waiting for a chance to serve their country.”

He urged the business and economic media to exert more effort in preparing, explaining, and simplifying the transfer of information and figures, and avoid repeating the same topics and guests on channels, and to avoid the economic “fatwas” of non-specialists.

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Uber launched more affordable options in response to Egyptian government’s request for low-cost transport options:  Waked Mon, 17 Dec 2018 13:00:31 +0000 Over 200,000 drivers use Uber to increase their income

The post Uber launched more affordable options in response to Egyptian government’s request for low-cost transport options:  Waked appeared first on Daily News Egypt.

Uber is one of the big tech American companies with approximately 100m users over the world, in 2014 it started the service in Cairo, 5 million trips were made using the application in the traffic-clogged city, which is one of Uber’s fastest growing markets, the company announced it will inject $100m in investment in the Egyptian market over the next five years. Daily News Egypt interviews Abdellatif Waked Uber Middle East and North Africa’s General Manager, to find out the company’s latest plans, and updates.

What are the obstacles that Uber faces in Egypt? And how does it overcome them? 

We constantly work to use technology to overcome challenges at Uber. For example, the rising inflation and costs for the drivers were our primary concerns in Egypt. In response, we launched a series of partnerships to lower the costs, such as the Rent-to-Own programme with Nacita, which reduced entry barriers and streamlined the rental process for drivers. This is in addition to an insurance programme, in partnership with AXA, providing coverage for both the drivers and riders in case of accidents or lost income.

For riders, Uber launched a range of low-cost options including the UberScooter, and most recently the UberBus, which is 70% cheaper than UberX, in response to the Egyptian government’s request for low-cost transport options.

What are the latest updates concerning the white taxi drivers’ complaints against Uber?

This is about the customer’s choice, which we greatly believe in. The competition that Uber introduced in the Egyptian market helped increase innovation from the existing service providers. Taxis are also considering using ‘E-hail’applications to dispatch taxis in a more intelligent way.

How many drivers does Uber have in Egypt?

Over the past four years, Uber has been scaling up, putting Cairo on the map as one of the fastest growing cities in the Europe, the Middle East and Africa (EMEA). We started with 12 drivers when we launched in 2014, and now we have over 200,000 drivers who are using the Uber application to increase their incomes, 40% of those drivers were previously unemployed.

Do you have any intention to partner with any telecommunication companies, for example as Careem partnered with Vodafone?

We have an existing partnership with Etisalat, offering an array of value-added services to both our riders and drivers, in addition to launching various campaigns together.

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Uber aims to have fewer private vehicles on road: product director Mon, 17 Dec 2018 12:30:47 +0000 Cairo might be wonderful place for our flying cars project

The post Uber aims to have fewer private vehicles on road: product director appeared first on Daily News Egypt.

At a press conference held near the Giza pyramids, Ethan Stock, product director at Uber, explained to an audience of government officials, diplomats, and journalists the new Uber services. Uber Bus is part of the company’s global plan of targeting new customers with low cost shared trips. Uber Lite is a new simplified version of the main application that can operate on any Android phone. The US-giant company’s market value is estimated to be $76bn.

After leading Facebook’s youth team which works across Facebook, Messenger, WhatsApp, and Instagram to identify the social and communications needs of the younger users, Stock joined Uber in early 2017.

Stock leads product management for shared rides, which operates UberPool, a service launched in 2014. In early 2018, Express Pool was launched, offering riders a lower-cost shared ride in exchange for riders choosing to walk to meet the driver at a spot along the route. Stock is concluding 2018 by launching the Uber Bus.

Daily News Egypt interviewed Stock, looking for answers on Uber’s next big step, its vision for the future of transportation, and the ways by which the company deals with its problems. The transcript of the interview is below lightly edited for clarity.

Do you think shared rides are more affordable to customers than the UberX service? Is that why you launched the Uber Bus?

Yes, this is exactly what we are trying to do with the UberBus. Many people go to work every day and afford to use Uber as the cost to take a taxi five or seven years ago, is still the same now in Uber and we are significantly improving over time. Yet, the question is how we can create a service for the people whose incomes do not allow them to use Uber every day.

To clarify further, if you put a vehicle’s cost and a driver’s time into consideration, you will find out that the driver is making a good income out of the Uber service, but the fare should not go lower, or that is going to impact the driver’s earnings. The best way to solve this problem is by having a shared ride through the Uber Bus which will have several people sharing the ride, as supposed to UberX with one person paying for the entire cost. This way, we can significantly reduce the cost that people pay, while continuing to provide good earnings for drivers.

Being stuck in a traffic jam can be wearisome, so are there any features in the bus for entertaining the passengers?

Our vision is to have fewer private vehicles on the road by getting more people into shared vehicles, as buses. We are focusing on reducing the congestion and making all these trips faster, thereby improving traffic. As for the entertainment, there are many companies such as Facebook that do a pretty good job of helping people entertain themselves while they are riding vehicles like Uber.

What are you planning to do after launching the Uber Bus and Uber Lite? What is the next step?

This is actually the most important part of the process. After both, Uber Bus and Uber Lite, are launched, the long process of making them truly great services begins. We focus on the very little details that make up a perfect service. This is the core of what I and the engineering team are going to do for the next couple of years. We aim to make our technology and products as good as they can possibly be.

Cyber-attacks and hacking are becoming critical issues, and people are worried about their personal information, so how does Uber use their customers’ data?

We have extremely good data security, and we put a lot of time and effort in making sure that nothing happens to our clients’ data. Uber is in charge of some incredibly important data such as address, contacts, financials, and even family members’ details. We obtain this data in order to have a service that is perfectly tailored for each customer. Therefore, Uber makes sure to take very good care of this sensitive information.

Ethan Stock, product director at Uber

Can you tell me more about Uber’s hacking incident last year?

Hacking is a problem that big technological companies face, we and many others are working as hard as we can to prevent any of our data and clients’ from getting hacked.

Some governments request companies to share their customers’ data with them, do you have the intention of sharing such data with governments?

I am not familiar with our policy details, but I believe that we follow the laws of the countries where we operate because we intend to operate legally within these countries. We do everything that we can, within the country’s legal framework, to protect the privacy and personal safety of our users.

Is Uber planning to have advertisements for the new application? or to share users’ data with third parties aiming to get advertisements?

One of the great things about Uber is the primary value that we get from interacting with our customers, as it is not a free service. Many of those models you referred to are for companies such as Facebook, YouTube, or Google, where the user does notpay for that service. In Uber, we have a different relationship with both our riders and drivers, with the former earning money and the latter spending money byusing our service. Uber allows us to focus on the primary economic relationship we have with our users, rather than secondary relationship that could potentially impact our privacy such as advertising.

Some governments feel that their authorities are being transferred to Uber, how do you see the future of ride sharing technology as Uber’s product director?

I think that technology has a huge impact on improving cities. If you look at the efficiency with which Uber’s riders and drivers operate, we are definitely making a change. By putting this together in an application with sophisticated software, and by matching algorithms and mapping, we make it better for drivers, riders, and cities. Through Uber’s cars, scooters, bikes, and buses, we want to integrate our system with public transport. Authorities also want to create an efficient public transportation system, for example in London, the public transportation system is very efficient, yet it is actually privately operated under the ‘Transport for London’. When I look into the future of how we work with the authorities, I think we will continue to operate private systems of transportation as we do today, but I also think that there is even a greater opportunity for us to partner with governments to operate parts of public transportation on their behalf.

What is Uber’s plan with the autonomous car project, especially after the unfortunate accident when a woman was hit and died? Is the project still operating?

The service was under experimentation, this is actually an example of the constant work we do to improve our services, before and after launching a service. The incident was very tragic, and we significantly revised our safety procedure sin order to prevent this from happening ever again.  I do not work directly with that team, but I know that they are still testing this service. We do believe that autonomous cars are part of the future.

Could you tell us more about Uber Elevate? Will we be able to have flying cars soon?

Uber Elevate is another project that we are working on. We are working hard to invent a future service, but this is the future that will not arrive in one or two years, rather in five to ten years. We also think that Cairo might be a wonderful place for something like this, because it is a large area with high traffic. With the new electric technology for flying vehicles, the cost of flying vehicles will be low compared to gas-powered-helicopters, and it will be very safe as well. We think that there is a very interesting opportunity to create an efficient system for a flying Uber in the future. Yet, this is something I do not currently working on as I am focusing on the next five years for Uber, but I am excited that we are a company that has this kind of vision, where there are people working on far future projects, while the rest of us are focused on today and the next few years.

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Egypt is first Arab country to hold IPS after UAE Mon, 17 Dec 2018 10:00:02 +0000 Egypt comes at top of countries with highest return on investment in real estate market, says Farghal

The post Egypt is first Arab country to hold IPS after UAE appeared first on Daily News Egypt.

The International Property Show (IPS), organised by ‘Strategic Marketing and Exhibitions’ company, has been held for the past 15 years in Dubai. For the first time, the company plans on holding it in Egypt in January, with the participation of about 30 real estate developers.

Walid Farghal, director general of the IPS, said that his company is targeting the Gulf Cooperation Countries’ (GCC) investors to the Egyptian real estate market, as part of the real estate export initiative through holding the IPS in January.

Daily News Egypt sat down with Farghal to find out the company’s plan for holding the IPS in Egypt for the first time, after always being in Dubai. The transcript for which is below, slightly edited for clarity:

How do exhibitions increase Egypt’s competitiveness in the global real estate market?

Foreign exhibitions are ideal platforms for attracting foreign investment, given the strong opportunities available in the real estate sector, especially in the Egyptian market.

How do you see the participation of the government with developers in exhibiting projects at the same pavilion?

The participation of the Egyptian government represented by the ministry of housing with real estate developers will help increase foreign investment in the Egyptian market. This cooperation also confirms the government’s support, represented by the ministry of housing, for real estate developers and projects, therefore facilitating investments in Egypt, and allowing the efficient communication between all the parties and stakeholders involved.

What is your vision for Egypt’s real estate market and its future growth?

Egypt comes at the top of having the highest return on investment in the real estate market, exceeding a lot of others countries and markets. This presents a good opportunity for foreign investors to invest in the Egyptian real estate market, and there are several important advantages provided by the Egyptian government for investors in this market as well.

Walid Farghal, director general of the IPS

When will ‘Strategic Marketing and Exhibitions’ company hold the IPS in Egypt?

The company announced the establishment of the IPS exhibition in Egypt after several successes over the past 15 years in Dubai, which confirms the success of the Egyptian real estate market on the local and international levels.

However, the company decided to postpone the exhibition to January 2019, after taking experts’ opinions, as well as the participating developers’. We wanted to choose the most appropriate time as the Egyptian real estate agenda was crowded during the last quarter of 2018 as several exhibitions and conferences were held. This also reflects the company’s and its partners’ desire to establish an event worthy of the name and position of the IPS, and its first edition in Egypt. Moreover, the IPS targets large and well-known developers who have distinguished spaces and designs.

Moreover, through the IPS, the company is targeting GCC investors to invest in the Egyptian real estate market, as part of the real estate export initiative.

The show targets prospective customers from the UAE, Saudi Arabia, as well as Kuwait, and international investors are expected to increase during the coming period, especially that investors from the Gulf region are interested in Egypt’s real estate market. Furthermore, there are many Arabs who own properties in Cairo, as well as the tendency of others to buy housing units in new cities, as well as the New Administrative Capital.

Why did your company plan to launch the IPS in Egypt for the first time?

Choosing Egypt to launch the first version of the IPS outside Dubai after more than 15 years is very significant for Egypt, namely the strength of the Egyptian market and the confidence of capital flows to Egypt, as well as the depth of relations between Egypt, Dubai, and the other brotherly Arab countries. The IPS is expected to witness a huge demand and attract capital from various countries, especially after several international companies showed their interest in exhibiting at the IPS in Egypt.

What is the value of the IPS’ expected sales?

It is difficult to predict the IPS’ sales’ volume in Egypt because this is the first edition in the country. Yet, 20,000 visitors are expected to come during the exhibition period, given the importance of the IPS for all the stakeholders in the real estate sector, both locally and internationally.

What are the other exhibitions that the company intends to hold?

The IPS in Dubai will be launched from 26 to 29 March 2019, amid expectations of a strong Egyptian participation.

Egypt has achieved a great progress through issuing a law granting residence for foreigners who buy property in Egypt. In your opinion, what are the procedures needed to motivate foreign investment?

The government has to promote real estate not only through the participation in international exhibitions, but it is also necessary to put mechanisms that encourage foreign investors to acquire units in Egypt.

Do you think that the state is a competitor for the developers?

The state does not negatively intervene with real estate developers. On the contrary, it supports the attraction of investment by facilitating the opportunities for various real estate developers both locally and internationally.

The post Egypt is first Arab country to hold IPS after UAE appeared first on Daily News Egypt.

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Emirates flies 1.1 million passengers to, from Cairo over last 19M Mon, 17 Dec 2018 09:00:19 +0000 Company to retire seven aircraft from its fleet

The post Emirates flies 1.1 million passengers to, from Cairo over last 19M appeared first on Daily News Egypt.

Orhan Abbas, Emirates’ senior vice president for commercial operations in Africa, said that his company flew over 1.1 million passengers to and from Cairo during the period from April 2017 to November 2018. “The top countries visited by Egyptians on Emirates are the UAE, China, the US, Australia, and India.”

Daily News Egypt interviewed Abbas to speak about the company’s activities in the Egyptian market over 2018 and their plans for 2019; the transcript of which is below lightly edited for clarity.

How many flights does Emirates operate from Egypt?

Emirates currently operates three daily flights between Cairo and Dubai with its popular Boeing 777 aircraft.

How do you see the security procedures adopted in the Egyptian airports?

We always comply with airport and government authorities’ rules and regulations in the countries we operate in.

How many passengers did Emirates fly to and from Egypt in 2017? What are the company’s estimates for 2018, and goals for 2019?

Emirates flew over 30.1 million passengers furing the period from 1 April to 20 September 2018, up 3% from the same period last year. In Egypt, we flew over 1.1 million passengers to and from Cairo from April 2017 to November 2018. The top countries visited by Egyptians on Emirates are the UAE, China, the US, Australia, and India.

Ticket prices were increased after local currency flotation in Egypt in November 2016, how the company’s ticket prices got affected compared to 2016?

Our current prices are competitive in the market and our offers are popular among Egyptian travelers. Passengers flying with Emirates will have three-class cabin in our B777-300ER with 310 seats in Economy Class, 42 seats in Business Class, and eight seats in First Class.

Economy Class features specially designed and contoured seats in a 3-4-3 configuration with 2-4-2 configuration in the last rows with generous space for passengers. Business Class offers comfortable ‘sleeperette’ seats which recline to a 0.78 metre long lie flat bed.

First Class features the world’s first private suites with privacy screens, massage-enabled leather seats which convert to flat beds include luxurious comfort covers, down pillows, and cotton-lined blankets.

Passengers travelling in First Class will also find the BYREDO travel wellness range of skincare in their private suites and brand new Bowers and Wilkins’ Active Noise Cancelling E1 headphones, to amplify the viewing experience on ice.

We recently launched our airport lounge in the Cairo International Airport to provide our customers even greater levels of comfort, hospitality, and convenience as they start their Emirates experience in Cairo.

How do you see the company’s five-year strategy in Egypt?

Emirates has commenced operations over 30 years ago, and we will continue to be in an important market that has the potential to grow. We hope we can bring greater connectivity between Egypt and the rest of the network. Our view is optimistic.

How many aircraft does Emirates have? What about your fleet modernisation plans?

Emirates operates the world’s largest fleet of Boeing 777 and A380 aircraft. Emirates operates 105 A380’s and 164 B777’s to 159 destinations, including Dubai, and 15 dedicated Freighter destinations. Emirates received eight wide-body aircraft – three Airbus A380s, and five Boeing 777s, with five more new aircraft scheduled to be delivered before the end of the fiscal year (FY).

We also retired seven old aircraft from our fleet with further four to renter operation by 31 March 2019. The airline’s long-standing strategy to invest in the most advanced wide-body aircraft enables it to improve overall efficiency and provide better customer experiences.

How much was the cost of your newly opened lounge in Cairo airport? Do you plan for any new investment in Egypt in the future?

The Emirates Lounge in Cairo International Airport cost $3.6m. The interior of the Emirates Lounge reflects a new contemporary and fresh design. The lounge offers seating for up to 152 customers, covering an area of 880 sqm. The lounge provides premium passengers with a relaxing ambiance, luxurious facilities and amenities, LED TVs, comfortable leather armchairs, a choice of formal and relaxed seating, bespoke artwork, and separate male and female prayer rooms.

To complete the travel experience, a range of luxury spa products are also available in the lounge from award-winning Irish brand VOYA. This skincare line includes hair and body wash, conditioner, hand cream, and hand wash.

The lounge features a dedicated dining area, an extensive menu of complimentary hot and cold gourmet buffet, including local and international dishes and an extensive beverage service. Customers can also enjoy shower facilities, a fully equipped business centre with state of the art touch screen workstations along with complimentary Wi-Fi service within the lounge.

Do you face any challenges in the Egyptian market?

All markets we operate in globally are different and present their own set of advantages and challenges. We work closely with government authorities to comply with each country’s rules and regulations.

In terms of cargo, do you work in air freight? If yes, what is the amount of commodities did you transport in 2017? And what are your estimates for 2018, and goals for 2019?

In the first half of the FY 2018/19, the volume of transported cargo reached 1.3m tonnes while yield improved by 11% .This performance is the result of Emirates SkyCargo’s focused investments in products and services tailored to key sectors, which gives it a strong competitive edge in a recovering global air freight market.

In Egypt, 2.6m tonnes of cargo were transported between 2017 and 2018. The top cargo categories are perishables, such as fresh fruits, vegetables, fish, and textiles.

Do you have any corporate social responsibility activities in Egypt?

Globally, the Emirates Airline Foundation, a non-profit charity organisation, aims to improve the quality of life for children regardless of geographical, political, or religious boundaries, and to help them maintain or improve their human dignity. The foundation’s goal is to help disadvantaged children realize their full potential by providing them with the basics, which most of us take for granted, such as food, medicine, housing, and education.

Emirates has also supported United for Wildlife, a global collaboration that unites the efforts of the world’s leading wildlife charities in the fight against the illegal wildlife trade, by featuring on two A380 liveries some of the planet’s wildlife threatened by poaching and the illegal wildlife trade. It aims to raise awareness of the illegal wildlife trade and communicate the need for urgent action. We also collaborated with international organisations to train and better equip its ground and cargo staff to detect and deal with illegal wildlife products in transit. As the required paperwork for movement of some wildlife products is often forged, Emirates also made the decision to ban trophy shipments.

Emirates has introduced sustainable blankets produced from 100% recycled plastic bottles. Using patented ecoTHREAD technology, each blanket is made from 28 recycled plastic bottles. It is estimated that by the end of 2019, Emirates ecoTHREAD blankets would have collected 88m plastic bottles from landfills.

How many job opportunities do you offer? 

Emirates employs more than 1,055 Egyptian flight attendants and 16 pilots, in addition to over 2019 Egyptian nationals working in Emirates’ offices. We recruit in line with our growing operational requirements. We never disclose numbers and all vacancies are advertised online.

How many are the company’s destinations around the world? Do you mull over flying to more destinations in 2019? If yes, what will your new destinations be?

We fly to 159 destinations in 85 countries. In 2018, we introduced new passenger routes, which includes Stansted (London) – launched on 8 June 2018, Bali, Indonesia-Auckland, New Zealand – launched on 14 June 2018, Santiago de Chile via Sao Paolo – launched on 5 July 2018 and Edinburgh (Scotland) – launched on 1 October 2018.

Would you please explain the historical relation between Emirates and Egypt?

Emirates commenced serving the Egyptian market in 1986, and has become one of the top three markets for Emirates in Africa. We operate three daily flights between Dubai International Airport and Cairo International Airport. Emirates currently has two local offices in Cairo, one in Mohandessin and the other is in Heliopolis.

Would you please elaborate about the company‘s revenues?

The Emirates story started in 1985 when we launched operations with just two aircraft. Today, we fly the world’s largest fleet of Airbus 380s and Boeing 777s, offering our customers the comforts of the latest and most efficient wide-body aircraft in the world. We inspire travellers around the world with our growing network of worldwide destinations, industry leading in-flight entertainment, regionally inspired cuisine, and world-class service.

The Emirates Group today announced its mid-year results for 2018/19. The group saw steady revenue growth compared to the same period last year, however profits were impacted by the significant rise in oil prices, and unfavourable currency movements in certain markets, amidst other challenges for the airline and travel industry.

The Emirates Group revenue was AED 54.4bn ($14.8bn) for the first six months of its FY 2018/19, up 10% from AED 49.4bn ($13.5bn) during the same period last year, according to a past statement of the company on 15 November.

Profitability was down 53% compared to the same period last year, with the group reporting a 2018/19 half-year net profit of AED 1.1bn ($296m). The profit erosion was primarily due to the significant increase in fuel prices of 37% compared to the same period last year, as well as the negative impact of currencies in certain markets, added the statement.

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Egyptian woman pioneers exposé of entrepreneurship ecosystem in Egypt Thu, 13 Dec 2018 12:30:43 +0000 Do not personally limit yourself: Abaza

The post Egyptian woman pioneers exposé of entrepreneurship ecosystem in Egypt appeared first on Daily News Egypt.

Currently, most youth on a global on scale, especially in Cairo are taking the topic of entrepreneurship as a topic of interest, and subsequently they dream of funding or investment for their startups. Subsequently, the RiseUp Summit contributed towards turning this dream to a reality.

The Rise Up Summit is an annual event which connects both stakeholders and startups together, providing start-up owners with opportunities for exposure, resources, as well as advice.

The event was properly marketed worldwide to the extent that it witnessed for the sixth consecutive year a considerable representation from all over the world during the period from 7 to 9 December.

Thus, this took Daily News Egypt to ponder about this strong exposure of the entrepreneurship ecosystem in Egypt.

Digging further into the subject matter, DNE found that since 2013, the RiseUp Summit partnered with a Public Relation (PR) consultancy named Publicist inc. Noteworthy, this partnership helped propel the entrepreneurship ecosystem exposure in Egypt, but you might be surprised when you discover that the founder of this company is a female entrepreneur called Mai Abaza.

Hence DNE interviewed Abaza to learn more about her journey as a woman entrepreneur, her companys role in the RiseUp summit, and the obstacles that she faced during her journey in the PR field.

Also, the interview tackled the status of women entrepreneurs in Egypt, including their obstacles and opportunities, the transcript for which is below, lightly edited for clarity:

When and how did your journey in the PR field start?

I graduated from the Faculty of Mass Communication at the American University of Cairo, and specialised in integrated marketing communications; thus my education itself was in the field of the PR.

I was born and raised in Dubai, and after my graduation, I worked for seven years in a PR agency there. During these years I worked with clients across many sectors including the government, ICT, lifestyle, entertainment, retail, and healthcare. My work also included planning, driving, and managing campaigns in the UAE, Kuwait, and region-wide.

In 2009, I returned to Egypt, and worked in a multinational PR company dealing with the

General Authority for Investment (GAFI), where I was managing its global communication campaign in 10 countries around Europe, the Middle East, and Asia.

Then after the revolution this work stopped, so my friend and I thought about opening our own business in the PR field. Then we came to the conclusion to open Publicist Inc.

What services does your company offer?

Publicist Inc provides strategic communications advice to clients across diverse industries and delivers corporate communications, media relations, event management, and social media services.

What are the sectors or fields that Publicist Inc. deals with?

In 2011, the idea of using social media to promote products or services was very basic so we began with working in the restaurants field, but by time we grew to the extent that our work now spans the government, technology telecom, consumer market, entrepreneurship, health care, and many other industries.

What’s your company’s vision?

Our vision is to be a learning organisation where people come and learn the meaning of being a PR consultant, and to help organisations achieve their objectives through PR.

Who are Publicist Inc.’s most prominent clients?

RiseUp, Uber, Maged Al-Futaim group, Discovery Education, and Watanya association.

How many employees does the company have, and out of them how many of them are women?

I have 17 employees, only three of them are men.

The field of PR is highly controversial because some people think the PR is trying to overtake the press’s role, what is your opinion?

This is completely false. PR companies are considered facilitators, as they facilitate the work of the press, especially when journalists deal with the private sector, as the private sector’s employees and owners usually find it too hard to understand what the journalists specifically want to know.

For example, some clients came to us at Publicist Inc. asking that journalists publish an announcement for their company since it was launching a new product, but the journalist fond that this was something which was not newsworthy. This is where the role of the PR agency comes in order to meet the expectations of both the journalist and the client, through thinking with the client about the impact of his product on the society and the economy, thereby transforming the announcement the new product into a newsworthy article for both the journalist and the reader.

Could you elaborate on your company’s exact role in the Rise-Up summit?

We are RiseUp’s PR partner since the second year for the summit, providing PR consultancy. We also control the press centre, presenting all the press releases to the journalists, and subsequently dealing with all the conference coverage.

I want to underline that in the first three years of the summit, the company exerted substantial efforts in communicating with journalists and launched for them a two-day workshop to provide them with the required terminology used in the entrepreneurial community, in addition to elaborating on the real meaning of the entrepreneurship community.

As RiseUp mainly focuses startups and technology, what challenges do you think women face in these sectors?

In the technology field, women entrepreneurs face a lot of challenges as investors do not highly regard women-led start-ups, although statistics prove women-led startups are more successful than men-led-startups.

Did women’s representation in RiseUp increase this year compared to previous years?

Definitely yes, but still there is a lack in women’s representation in the technical side, including the developers and the engineers, despite the fact that we have women who are of qualified calibres in the technical side, although there is no focus on them.

Through your presence in RiseUp, what is the difference between female and male entrepreneurs?

I think that women always don’t seek to brag about their success, as they always focus on their work on the ground, but they rarely think about marketing their work. For example, throughout the six years of my work with RiseUp, only one woman entrepreneur came to ask about PR consultancy. Thus, this confirms that they are more focused on what they are doing.

Do you think there is enough support from the government towards the entrepreneur ship community and entrepreneurs in general?

It has come a very long way, but definitely there is considerable interest and focus. For example, in the Africa 2018 Forum there was a whole day for entrepreneurship. I think the link that Egypt lacks in order to provide full support for entrepreneurs is to raise awareness and focus in education. It could be, for example, part of the curricula for students to discuss technology, innovation, etc.

As an entrepreneur, what obstacles did you face at the beginning of your


On the personal side, the only obstacle is managing the time between my domestic affairs and the workload, but I want to highlight that I have a strong support system, including my husband and mother-in-law who both support me, in addition to that my work was beside my home which helped me to succeed in managing my time.

On the other hand, regarding large corporations and clients, the stereotypical concept that female entrepreneurs are not as qualified as men still exists.

I want to highlight that sometimes we as women put limitations on ourselves internalising the stereotyped image of women in the public’s mindset which places upon us the nuisance of trying to sever this stereotypical image.

I think there is a challenge that faces entrepreneurs whether female or male which is the lack of knowledge about the legal procedures to establish a new company.

What is your advice for women entrepreneurs?

Do not personally limit yourself.


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Democracy in Arab world leads to civil wars, I refuse calls to amend Constitution: Dr. Abdelmoneim El Saeed Thu, 13 Dec 2018 10:00:17 +0000 Files of terrorism, water, regional situation, not completely in our hands

The post Democracy in Arab world leads to civil wars, I refuse calls to amend Constitution: Dr. Abdelmoneim El Saeed appeared first on Daily News Egypt.

Dr Abdelmoneim El Saeed has worked in Al Ahram Centre for Political and Strategic Studies since 1975 as an assistant researcher, then as a researcher, then head of the department of International Relations, and he has many writings concerned with the new international system, Arab affairs, the European partnership and the Arab-Israeli conflict.

In addition, he has articles on security issues in the Middle East, Egyptian policy, arms control, as well as many articles which were published in the US, Asia, and Europe. Daily News Egypt interviewed Dr El Saeed, the transcript for which is below, lightly edited for clarity:

How do you view journalist Jamal Khashoggi’s case and its developments?

The developments of the case cannot be separated from the reform which was launched in Saudi Arabia a year ago or more. The kingdom is turning from an oil state to one with industrialisation and development, and of course with such reforms, and quick measures, blatant mistakes take place, which is why the king started reforming security bodies.

Photo by Asmaa Gamal

Will this problem hinder reforms?

On the contrary, it may speed it up, and it all comes down to the way the government handles the situation. Almost all the truths were revealed except for who gave the order to kill Jamal.

How do you see Saudi Arabia’s future ruling after the repercussions of Khashoggi’s case?

I’m against analysis that believes this case will change the ruling system in Saudi Arabia. There are much bigger and more dangerous challenges in Saudi Arabia.

Will the reforms led by the crown prince survive this crisis?

Yes, because even though the incident is terrible, it should not waste the great geostrategic gains reached by far.

What are these gains?

A country as important as Saudi Arabia is starting to see all these major reforms in terms of women’s position in society, in addition to the change in Salafism, all of which are major changes. It is hard to sacrifice all of that despite the ugliness of the case.

As for the Arab situation, is establishing an Arab deterrent force becoming a reality?

The manoeuvres taking place regularly are a type of military alliance, and I believe that there could be a strong balance, which was the case in Europe after Napoleon’s defeat.

What about Kuwait’s reservations and the Qatari dispute in this alliance?

The alliance will include those who were present. If Europe waited to include all countries into its alliance, there would have been no alliance at all.

Do you believe there are signs for resolving the Arab-Qatari dispute?

Of course, there are signs for this seeing the positive way Qatar was mentioned by the Saudi Crown Prince and President Al Sisi. The problem with Qatar revolves around one point, which is opening media platforms to attack Arab countries and hosting groups which adopt violence and terrorism against Arab regimes.

Why does Qatar insist on this?

To be fair, some of the groups hosted in Qatar arrived with an American desire involved. Why you may ask, because America wants to keep them to cooperate with them whenever needed. For example, the Taliban are in Qatar. At the same time, the Qatari conflict embarrasses the US. Qatar has the largest US regional military base.

What is your opinion on the current situation in Syria?

The US and Russia are in control. They agree that they do not want Iranian presence in Syria because it would lead to a direct confrontation with Israel, which is a scenario that scares everyone, and will force the US to intervene in ways it does not want. During the current phase, there is more focus on fighting Da’esh in Syria.

How do you expect the situation to end?

With a US-Russian agreement for everyone, according to their interests.

Are the Russian and Egyptian viewpoints in Syria identical?

No, there is a conflict. Egypt does not prefer the Russian military presence in Syria continues, and sends clear signals concerning this. It appreciates the importance of the Russian role in the stability and transformation that took place in Syria, though.

Was the Russian role crucial in changing the situation in Syria?

To a great extent, yes. Before the Russian presence, Bashar controlled less than 30% of Syrian lands, and this has currently changed. Russia has also played a major role in the negotiations that prevented many battles and saved many victims.

Regarding Israel, do you believe that the truce with Hamas is a victory for it?

Saying that a truce between Hamas and Isreal is a victory for Hamas is erroneous. Isreal was in Gaza and executed operations. It found that further presence in Gaza costs human lives, and will irritate the international community and it does not want that, so it resorted to truces. As for Hamas’s rhetoric about victory in light of the starvation and siege its population is facing, it is absurd.

Do you believe that the status of the Palestinian cause has changed in the minds of Arabs?

Unfortunately, Arab countries are in a coma and do not realise the major changes that occurred. The US has acknowledged Jerusalem as Israel’s capital, and thousands of Palestinians enter Israel on a daily basis to work there. There is currently a significant integration of both countries and it is difficult to find a solution for that. Israel is the country in control of the entire situation, and there are 21% Arab Israelis and the majority of people in Eastern Jerusalem are Jewish. There are no constants in this case anymore.

What can Palestinians do now?

There 12 million there between the river and the sea, including six million Arabs. They must be helped to develop in order to prove they deserve a Palestinian state.

What is the US’s role in all of this?

It the biggest supporter and Trump is very biased towards Israel, and this is what he said before he took office.

What is your opinion of Trump now?

Trump is a new version of the US leadership, and there has not been that model of the US leadership since George Washington. Until this moment, some are still very worried because Trump is trying to change some constants in US trends, such as building barriers before freedom of trade. The US is the messenger of this freedom, but I believe Trump has a deal and only does that to improve the negotiation conditions with other countries. He does not rely on specialists we are familiar with in political and strategic sciences, but unlike previous leaders, he has no problem with authoritarianism.

How can the results of the recent elections in the US be analysed?

Both parties have designated their weapons in ideologies and propaganda but summoning Barack Obama to the elections has made the competition not only between two parties (Democratic and Republican), or between two ideologies (liberal and nationalist), but also between two presidents in a in a battle whose time is in 2020.

What are the most prominent conflicts between the two sides?

Both parties have considered the electoral battle historic because it is a chance to return to historical values and state defence against a minority of domestic liberals and the media, and countries abusing the US’s generosity abroad. This “critical mass” of politicians who agree that the US must run the universe has disappeared. It also believed that the free market is the essence of the US economic regime which is armed with a social protection umbrella. This was clear when Trump said that the names Barack and Obama come with Hussein in the middle, and that was not the sole hit below the belt, and Obama was not the kind of man to take more hits. He said that during his tenure, no one was presented to the judiciary, but in the tenure of Trump that followed, enough people for an American football stadium were presented to the judiciary.

Is the US at a crossroads?

That is right. This has been the case since WWII. Up until now, everything that’s happened has reflected Roosevelt’s new deal inside and the foreign alliances outside leading the world towards liberalism and capitalism founded by Truman and Eisenhower abroad. Now there is new path recalling history post WWI where there was isolation and selective interventions outside, and non-liberal capitalism inside.

What comes after the elections?

The elections are over, and perhaps their results were a lesson by the US to politicians. The Democrats are back to the political field by a majority win in the parliament, as for Republicans, they have kept the majority in the Senate.

Democrats have the highest number of state governors, but the majority remain Republicans. There is balance at a point that theoretically allows negotiations rather than conflict, and there is room for cooperation to build the infrastructure and the deal between building the wall with Mexico in exchange for giving legitimacy to the project of the “Dreamers”—the younger ones who came with their families to the US but have not yet obtained the nationality.

The room for deals is big, and maybe there is now a different political climate based on the belief that in democracy, everybody wins.

Obama still believes that the war continues but winning that war would happen through more than one battle as long as Trump is the ruler.

Is our relationship with America at its best?

Bilateral relations between the US and Egypt are going through a good stage. There is great confidence between the Egyptian and American presidents, even the trade war between the US and China gives a major chance for Egyptian products. Of course, there are conflicts, but this is healthy to have between countries.

Given the internal situation, how do you view the economic reform?

I support the economic reform plan, and there always the tendency to focus on the seas rather than the river, because now we see focus on the Suez Canal, the North Coast, and the Red Sea.

I believe what is currently happening answers the question “Where is Egypt headed?” I believe that Egypt is headed towards implementing the 2030 plan. The problem now is moving a country towards one which has a strong media that still allows a certain kind of opposition.

What about the experiences of the past period?

Unfortunately, they are all amateurish. There is not a single current Egyptian media expert that makes one optimistic. We either see the media as blind supporters or as a political platform and this does not benefit the community.

What about new media organisations?

I do not believe these organisations have succeeded. Sure, they are good people, but we have not become better in terms of the press and media institutions, and we obviously perceive an economic and intellectual crisis.

Is this why the state controlled media to a great extent?

It is not the only or main reason. Before, we could see a more balanced equation. I remember during the tenure of Mubarak when I presented a programme whose episodes solely focused on opposition.

How do you see the anticipated changes in media leaders?

I believe they are necessary because the nature of people creates a difference in the situation. A single person can make a change in an entire institution. Whoever comes after Supreme Media Council Head, Makram Mohamed Ahmed, must plan a new strategy and must have time to write the constitution. I was against the presence of such institutions because there is an international way to be followed to control media.

As is the case in media, do we need political reform?

Political reform is one of the most difficult things to be carried out in society. When globalisation appeared, we thought that countries’ experiences can be exchanged as they are with other countries, but it turns out that this is not true for many things, especially political reform. What works for a country may not work for another. Experiences like China’s, Russia’s and other countries in Asia have reinforced this trend because they have managed to succeed even though they did not follow the Western model.

In Egypt, the final result that is most suitable will be determined by the nature of the current community social and political interactions, rather than by a decision.

We must understand that democracy is good until it turns into ultra-nationalism. When this happens in the west, the most that happens is electing a Nazi party by 10-20% then it is not elected again, but in the Arab world, the result would be a civil war.

What concerns you the most for Egypt now?

Terrorism, water, and the deteriorating situation of the region. We have no control over them, but we must at least learn from the lesson of the Renaissance Dam. We have to have a “sea” policy not a “river” policy. This means that we must diversify our water sources, which is something we have already started working on. We must focus on water desalination plants, especially that modern technology has relatively reduced the cost and I’m optimistic about the path the president is taking.

How do you see the calls for amending the constitution?

I refuse these calls. At least not before the full constitutional session is completed.

The post Democracy in Arab world leads to civil wars, I refuse calls to amend Constitution: Dr. Abdelmoneim El Saeed appeared first on Daily News Egypt.

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Philip Morris is building future on smoke-free products Wed, 12 Dec 2018 13:30:00 +0000 PMI has invested over USD 4.5 billion in research, development and commercialization of smoke-free products

The post Philip Morris is building future on smoke-free products appeared first on Daily News Egypt.

Philip Morris International (PMI) is a leading global cigarette and tobacco manufacturing company, with products sold in over 180 countries.

PMI is building a future on smoke-free products (also referred by the company as Reduced Risk Products or RRPs) that are a much better consumer choice than continuing to smoke cigarettes. In its 2017 Sustainability Report, PMI has stated the ambition that by 2025, at least 30% of its volume would come from smoke-free products.

“We would like to offer better alternatives to adult smokers in Egypt”, Managing Director Philip Morris Misr (PMM) and Levant, Vassilis Gkatzelis, informed Daily News Egypt in an interview at his office.

An INSEAD Global EMBA graduate, Gkatzelis has held key positions throughout his 15-year career at PMI, and enjoys a broad geographical exposure spanning Asia, the European Union, North Africa and the Middle East.

“Philip Morris Misr (PMM) is the number one international player in the Egyptian tobacco industry, with a 22% market share. The company provides numerous job opportunities, as it employs around 2,500 people, whether directly or indirectly, across its value chain, including manufacturing, supply chain, and distribution, among others. This comes in addition to over 100,000 retailers who sell PMI products on a daily basis,” Gkatzelis stated.

DNE interviewed Gkatzelis to learn more about their smoke-free products, the cigarette industry in general and its challenges, as well as PMI and PMM’s future plans, the transcript for which is below, lightly edited for clarity:

Could you please give us a general brief about the tobacco industry in Egypt and how PMM perceives the country’s tobacco market and the manufacturing process, given that this industry is one of the key pillars of the economy, and the country is considered the largest tobacco market in the Middle East and Africa? According to Central Agency for Public Mobilisation and Statistics, the tobacco tax revenue represents over 8.5% of government tax revenues, and is considered the second largest income contributor to the Egyptian state finances, following revenues from the Suez Canal.

The industry has significantly evolved, and PMM has been playing a major role in its development. The Egyptian market is witnessing strong competition, thanks to the presence of international tobacco companies besides Eastern Tobacco Company (ETC). ETC manufactures a total of 86bn cigarettes annually for all tobacco companies operating in Egypt.

PMM is the number one international player in the industry with a 22% market share. The company provides various job opportunities, as it employs around 2,500 people, whether directly or indirectly.

Are all PMM products manufactured locally rather than imported from other countries? Are there any imported brands?

We manufacture all our products locally at ETC, with whom we have a strong, long-term partnership based on mutual benefits.

Import are a possibility; however, imported cigarettes currently available in Egypt are most likely part of illicit trade, which is regarded as a global major issue. Illicit trade represents 10% of the global tobacco industry and is known to fund illegal activities, negatively affecting tax revenues, and posing a risk to adult consumers, since illicit products’ quality are not regulated nor bound by internationally accepted standards.

What are the reasons behind the price increase of cigarettes? What is the difference between the price increase and the tax increase?

There are several factors that determine tobacco prices. For your reference, around 70% of the retail cigarette price is comprised of tax, which has multiple components. So, if the price of a cigarette pack is EGP 30, around EGP 21 would be tax.

The other critical factor relates to the import of raw materials, given that tobacco is not domestically grown in Egypt. Imported tobacco, which is bought with a different currency, represents an increased cost after the floatation of the Egyptian pound. The other expenses that have to be considered are the manufacturing and distribution processes.

Who takes the decision to increase the price? Is it PMM or the government or is it an agreement between both sides?

The market is governed by the price freedom principle, so tobacco companies may set their product prices as long as they are in compliance with the government’s rules and regulations. Sometimes, the price increase is triggered by a tax change.

Governments increase taxes as a tactic to help decrease the number of smokers. In your opinion, did they succeed?

Taxation is one of the tools that governments use to reduce the harm of smoking.

Smoking cigarettes causes serious diseases, and the best way to avoid the harm of smoking is never to start, or to quit. 

Smoking prevalence globally, which was estimated at 22.1% in 2010, has been in constant decline for several decades, and the World Health Organization forecasts it will continue declining by 0.2% per annum. At that pace, it will take almost 100 years until the world is smoke-free.

But much more can be done to reduce health risks for the world’s 1.1 billion men and women who would otherwise continue to smoke, thus transitioning faster to a smoke-free future.

If the price increase does not help as all the statistics proved, what else did PMI achieve in that area?

PMI built its reputation as a leading cigarette company, with the world’s most iconic brands in the category.

Still, many would be surprised to know that PMI began to explore the viability and product development of smoke-free alternatives in the early 2000s. And that, in recent years, we have hired over 430 R&D experts, among whom 300 are world-class scientists, and have invested over $4.5bn to ensure adult smokers have better options. In fact, our vision is that these products—which present less risk of harm than continuing to smoke but are still satisfying to smokers—will one day completely replace cigarettes.

And this is not just a theory. PMI’s diverse smoke-free portfolio includes heated tobacco and nicotine-containing vapor products. Our flagship heated tobacco product, the IQOS, is now commercialised in 43 countries.

So far, 5.9 million adult smokers around the world have already stopped smoking cigarettes and switched to one of our alternative products. This number is growing, with approximately 10,000 smokers switching on a daily basis.

Also, the IQOS tobacco heating system has a very high conversion rate, with more than 70% of people purchasing the IQOS and using it exclusively or predominantly.

After a long history of manufacturing cigarettes, is PMI shifting its core mission to produce a different product?

PMI is transforming itself from a cigarette manufacturer to a science and technology-driven organisation. We have two state-of-the-art global R&D centres in Switzerland and Singapore.  Additionally, we have published over 250 peer-reviewed scientific papers since 2011, and have been granted more than 3,400 patents.

Smoking is harmful, this is a fact that is commonly known. But people often don’t know the ‘why’ and ‘how’ of this harm.  Though there is much misunderstanding, experts agree that nicotine, while addictive and not risk-free, is not the primary cause of most smoking-related illnesses. It is the burning process that creates smoke, which contains harmful toxicants.

Throughout years of testing and learning, we may now heat tobacco to release a satisfying aerosol without burning. This tobacco aerosol, which has dramatically lower levels of harmful toxins than cigarette smoke, still delivers nicotine at the same time as providing the taste and ritual that smokers demand. While heating tobacco is one possibility in developing alternatives to cigarette smoking, another approach is to produce a nicotine-containing aerosol without the use of tobacco.

How does your new the IQOS platform work?

Whereas the idea of heating tobacco, instead of burning it, has been around for over two decades, it is only now that we have finally managed to find ways to heat tobacco which results in products that satisfy adult smokers. The IQOS uses sophisticated electronics to heat specially prepared and blended tobacco. Furthermore, the IQOS heats the tobacco just enough to release a flavourful nicotine-containing vapor but without burning it.

Although the tobacco in a cigarette burns at temperatures in excess of 600°C, the IQOS heats it to much lower temperatures, below 350°C, generating a nicotine-containing vapor without combustion, fire, ash, or smoke. The lower temperature heating releases the true taste of heated tobacco. Because the tobacco is heated and not burned, the levels of harmful chemicals are significantly reduced, compared to cigarette smoke.

The IQOS experience has evolved over time based on consumer feedback. With our fourth and latest product iteration, the IQOS 3, which has just been launched in select countries around the world, we are not just delivering upgrades to the product’s design and functionality, but also to the way we engage with adult consumers. There are few products which revolutionise their sector and change holistically the consumer experience. We believe the IQOS is one of those products.

Do you have a certain criteria which countries must meet to qualify for the IQOS to be launched in?

PMI has made a public commitment to pave the way for a smoke-free future as soon as possible. The shift will take time, given that convincing 1.1 billion adult smokers is a very challenging task on its own.

The science shows that these smoke-free products are a better choice for smokers and those around them. When we can reach a critical mass of men and women who have switched, we can deliver a broader reduction in population harm. Innovation, therefore, has the power to change lives for individuals, and, collectively, the future of public health.

However, innovative products do nothing if people do not know about them. Getting the word out is difficult without support from regulators, public health experts, NGOs, and all those who care about smokers. This support is a key criterion to prioritise investments in countries, so that the related investment pays off not only financially, but also in terms of positive impact on society.

What is keeping you from launching the IQOS in Egypt? What do you need from the Egyptian government in order to introduce the IQOS into the Egyptian market?

From our end, we are committed to offer a portfolio of better alternatives to adult smokers while being transparent in our research and findings. But we can’t do it alone. Governments have a unique opportunity to help facilitate informed choices.

We are working together with the government and our partners to turn this into a reality.

Actually, when I go out, I see numerous adult users of the IQOS who have already stopped smoking cigarettes. Although the product has not been launched in Egypt yet, incoming travellers still manage to bring it into the country.

Are there other tobacco companies that produce alternatives? Why doesn’t the entire industry move together towards achieving one common goal?

We believe that the entire industry will ultimately move in the same direction. PMI has taken a global leading role with regards to the harm-reduction approach, and we will be glad if the industry’s key players follow suit, in order to ensure a sustainable smoke-free vision.

Did you choose Egypt to be PMI’s cluster hub because it is considered to be the biggest regional cigarette consuming country?

We trust the Egyptian economy and its potential to grow and prosper. The capabilities and talents of the Egyptian organisation serve as strong testimonies. We are proud that our people from Egypt have undertaken management roles of increased responsibilities in 12 different countries. The newly established Management Hub for Egypt and Levant in Cairo adds regional accountabilities in key areas like finance, marketing, IT, and human resources.

I am also happy to say that we have been certified for the third year in a row as a ‘Top Employer in Egypt’, in line with our global certification.

The post Philip Morris is building future on smoke-free products appeared first on Daily News Egypt.

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Egyptian exports still lack international quality standards, which require us to reconsider all our regulations related to product quality censorship Wed, 12 Dec 2018 11:00:02 +0000 Accrediting Egyptian trademark is a must, says Abo Elmakarem

The post Egyptian exports still lack international quality standards, which require us to reconsider all our regulations related to product quality censorship appeared first on Daily News Egypt.

According to the Head of the Chemical and Fertilisers Export Council (CFEC), Khaled Abo Elmakarem, economic reforms affected the exports sector positively and negatively similarly.

In an interview with Daily News Egypt, Abo Elmakarem unveiled the details of the government strategy which aims to boost the sector, and his CFEC plan to a improve performance within coming three years, the transcript for which is below, lightly edited for clarity:

How was the exports sector affected by the economic reforms?

Although the reforms affected all the economic sectors in the domestic market, but all current divisions including exports are reaping the rewards. Even the performance of imports in the three quarters of 2018 prove the improvement of the Egyptian economic climate.

What evidence do you have which proves your perspective?

According to the General Authority for the Control of Exports and Imports (GOEIC), exports performed better from January 2018 to September 2018 in 13 export sectors exceeding $18bn compared to about $16b in the same period in 2017, with a raise average of 11%. This means that the sector is successfully following the growth rates which were set by the ministry of trade and industry that aims to reach an annual growth average of 10%.

Can you elaborate?

New export sectors performed better in this period and achieved growth, such as handicraft industries which recorded a growth rate of 10% compared to the same period in 2017, and ready-made garments with a growth rate of 9.2%, textiles with a higher growth rate by 10.3%, in addition to pharmaceutical industries which achieved a growth rate of 13%.

So, how is the new strategy of boosting exports going to work?

By heading towards promising markets, especially African markets. The exports boosting strategy set 18 African countries to become the new destinations of our exports including Kenya, Sudan, Zambia, Uganda, Nigeria, Tanzania, Angola, Gabon, Senegal, Cameron, Djibouti, Equatorial Guinea, the Democratic republic of the Congo, South Africa, Ethiopia, Ghana, Somalia, and Côte d’Ivoire. These new destinations will be entered by most the exporting competitive sectors including building materials, food, pharmaceutical, engineering, and chemical industries.

And what about other proposed procedures?

The new proposed strategy is to establish a new exports body to maximise the benefits of all potentials that all concerned bodies are experiencing, and to become the only link between exporters, industrial sectors, companies, and the government in a frame of integration to develop exports which is the basic goal of the strategy itself.

The export sector is facing significant challenges, do you agree with that?

Indeed, the exports sector is generally affected by challenges of the Egyptian industry. These include the spread of the informal sector and its negative effect on the competitiveness of the formal sector, as informal entities do not bear any financial expenses such as taxes, duties, and fees. In addition, the government does not offer yet offer any incentives for the sake of integrating this sector to the formal one.

What about the aftermath of the economic reforms?

They caused a big raise in production costs due to raw material and inputs price increases. Moreover, there were increases in service prices related to exports such as stockpiling, shipping, and transportation. Additionally, there were higher prices of energy resources which were raised from July 2014 to date, as natural gas prices increased by 133%, and electricity consumption prices were increased by 40% until now. In addition, there were petroleum resources’ prices hikes, which, ultimately, led to dramatic increases of the final product.

How do you evaluate the government’s performance in dealing with this serious situation?

Unfortunately, the government does not allocate any funds to support export shipping to global markets, including East Europe, Central Asia, Russia, and MERCOSUR regional groups. These ones are considered the only alternative markets Egypt can depend on to compensate markets which exit our export destinations due to political instability. On the other hand, Egyptian exports still lack international quality standards, which require us to reconsider all of our regulations related to product quality censorship.

In your opinion, what should be done now?

The government must take active steps to cope with all challenges I discussed. In addition, economic reforms and their useful achievements over the coming years will guarantee good performance for the sector. Furthermore, the MURCUSOR agreement is going to be applicable soon, and interest rates will be decreased. All these conditions will push the sector to achieve the required 10% growth rate, hence reaching a volume of $25bn.

For the chemical sector, what does your council plan to do to boost its exports within the state’s strategy?

We aim to achieve an annual growth rate of 20%, and to double our chemical exports within the coming three years.

What mechanisms does your strategy include?

Expanding our activities to include small, medium, and micro enterprises, and eliciting new exporters to the sector. In addition, enhancing the transition towards exports of high value-added quality products. Furthermore, heading strongly into the African market, increasing the logistics areas to guarantee the availability of our products. This will be accompanied by offering beneficial training courses for exporters in order to enhance human resources in both the quality of marketing and products.

Back to exports sector in general, how can it overcome its troubles?

The rules of the subsidy payment to exporters who pay in cash should be reconsidered, by offering 50% of the subsidy, while offering 50% by the end of the year by virtue of verifying their financial statements and tax returns, claiming for a concession to hand the worth of these subsidies to exporters through an offset from their property taxes or other tax sources. In addition, we need to set some procedures which help manufactures to reduce imported raw material costs through a new technique of group purchasing through specialised companies and receive the benefits from global tenders.

Are there any other procedures to propose?

To set a new unexpected risk insurance programme to help exporters enter global markets without fearing unexpected risks such as buyers’ bankruptcy or political troubles in case of wars or uprisings in heated countries. Furthermore, compliant financing programmes should be considered to suit the nature of industry characteristics in the Egyptian market, and accrediting the Egyptian trademark promoting Egyptian products in global and regional markets. 

The post Egyptian exports still lack international quality standards, which require us to reconsider all our regulations related to product quality censorship appeared first on Daily News Egypt.

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Egypt’s wood industry has potential to export to US, Europe, Africa Mon, 10 Dec 2018 18:27:09 +0000 WoodShow achieved EGP 1bn deals, sales

The post Egypt’s wood industry has potential to export to US, Europe, Africa appeared first on Daily News Egypt.

The Strategic Marketing and Exhibitions company has concluded the fourth edition of the Cairo WoodShow platform under the patronage of the ministry of trade and industry from the 30 November of to 3 December with the participation of 175 companies from 24 countries, headed by China, Turkey, the US, Spain, Italy, and Germany.

The WoodShow has achieved EGP 1bn in sales and deals during the exhibit’s period, according to Walid Farghal director general of Strategic Marketing and Exhibitions company.

Daily News Egypt interviewed Farghal to discuss the show and its achieved deals, the transcript for which is below, lightly edited for clarity:

First, tell us more about WoodShow:

We inaugurated the first edition of the show in 2005, as it is the fourth in the world. We launched the first edition in Egypt in 2011, and the second was in 2012, then we stopped due to the political and economic circumstances at that time. Nevertheless, we resumed in 2017 with the participation of 150 local and international exhibitors and 8,295 visitors, and currently we have concluded the fourth edition which took place from 30 November to 3 December. However, the first edition was very successful as it exceeded our expectations. Cairo is the biggest furniture manufacturing market and the fair was very successful. 

How many companies exhibited in the WoodShow?

We have 175 companies out of 27 Egyptian manufacturers. The exhibitors are from 24 countries, headed by China, Turkey, the US, Spain, Italy, and Germany.

In addition, leading Egyptian companies in all production inputs of wood and furniture industry such as Good Wood, ARO Art, Abu Khaled Wood Trade, and other Egyptian agencies participated in the exhibition.

What is the target behind holding the WoodShow?

The show aims to allow exhibitors to present their latest technology in the wood industry and enables Egyptian final products to compete in international markets.

Furthermore, the competition between Egyptian and companies from other nationalities encourages the Egyptian product to enhance its quality.

What are the show’s achieved deals and sales?

The achieved sales amounted to approximately EGP 1bn.

How many WoodShow’s visitors were there?

The number of visitors reached 9,300.

How do you view the Egyptian wood and furniture industry?

The Egyptian furniture industry is qualified to lead the operations of Egyptian exports due to the quality of the Egyptian product and its foreign reputation, especially the Damietta products and the quality of the furniture required internationally, in addition to the considerable development in the tools of the furniture and wood industry.

Above all however, the Egyptian government launched several initiatives aiming to transform Egypt into a strategic hub for wood trading in Africa with reduced customs, tariffs, and corporate taxes.

Wood-based furniture domestic production is valued at $750m. Moreover, investment generated by over 1,325 companies registered with the Egyptian Industrial Modernisation Centre (IMC) reached $7.2bn.

Do Egyptian companies have a big share in the export market?

Egyptian companies do not have a big share of the export market because Egypt’s wood imports are not small as Egypt imports wooden raw material at a value of EGP 1.4bn from 10 African markets.

Moreover, a large percentage of domestic production is directed towards the local market instead of export, due to the decline in furniture imports due to the development of domestic products and policies. 

Egypt’s wood exports reached EGP 5.939bn by the end of 2017, a growth rate of 54% compared to the previous year.

Consequently, the show succeeded in attracting foreign investors to import wood from Egyptian companies.

Did the WoodShow witness an increase in demand compared to last year?

Indeed, the show attracted investors from different countries as well as more buyers than last year’s show.

However, last year achieved remarkable success as 40 exhibitors acquired some deals with Egyptian ones. In addition, some of them launched businesses in Egypt whether through establishing their own factories or through joint ventures.

What are the countries that the show focuses on?

We target mainly North African countries such as Morocco, Tunisia, and Libya as well as some other African countries such as Nigeria, Kenya, Uganda, Tanzania and Sudan.

What is the African country the WoodShow will be held in?

We held WoodShow in Gabon in June and it will be held next year in June in the same country.

Egyptian companies always have great potential in Gabon because there are Egyptian companies investing there and exporting to the world.

What are the potential markets to import Egyptian wood?

The best promising markets for importing Egyptian wood products are the US, European and African markets, as well as, North Africa, such as Morocco. 

Moreover, we aim to strongly enter the African market in order to encourage Egypt’s exports of wood products because Africa does not have a wood industry.

What is the role of the IMC in the WoodShow?

The IMC is our strategic partner and it plays an important role in business-to-business meetings between companies to support Egyptian manufacturers in promoting their products for export.

The post Egypt’s wood industry has potential to export to US, Europe, Africa appeared first on Daily News Egypt.

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MBDA studies partnership with ministry of military production in some local missiles production in Egypt: Fouche Mon, 10 Dec 2018 11:00:24 +0000 Middle East represents 25% of our market, annual turnover, says MBDA's Regional Executive export, Sales Director

The post MBDA studies partnership with ministry of military production in some local missiles production in Egypt: Fouche appeared first on Daily News Egypt.

In view of the closing of Egypt’s Defence Expo, EDEX 2018, the first exhibition of its kind, not only in Egypt, which holds a leading position in the purchase of armaments in the region, but also in the entire African content, Daily News Egypt interviewed laurnet Fouche, regional executive export, and sales director for the MBDA, which specialises in designing and producing missiles. The MBDA Company was among the exhibitors in the EDEX, with its own pavilion.

Notably, the EDEX lasted from 3 to 5 December in Cairo, bringing together 373 Egyptian and foreign companies engaged in the manufacture and delivery of modern security and defence technologies and systems from 41 countries.

The interview addressed the company’s expansion plans in Egypt, in addition to its services, and also discussed the Egyptian market, the EDEX, and mentioned the obstacles facing Egypt in manufacturing weapons, underlining how beneficial the EDEX was for the industry, the transcript for which is below, lightly edited for clarity:

What kind of services does the MBDA provide? And how many products does it offer?

Let me first say that the MBDA is a multi-national group with 10,500 employees working together in our branches. It is a joint venture of the three European leaders in aerospace and defence, Airbus with 37.5 %, BAE systems with 37.5%, and Leonardo with 25%.

It’s important also to mention that the MBDA works with over 90 armed forces worldwide.

In terms of the MBDA’s services, it is the only European group capable of designing, developing, and producing missiles and missile systems to meet the whole range of current and future needs of the three armed forces, including air, navy, and land armed forces.

Overall, the group offers a range of 45 products in service and another 15 in development.

How many branches does the company have? Any plans to expand ?in the Middle East, especially in Egypt?

The company has five branches in Europe, based in Spain, Italy, France, the UK and Germany.

Concerning the Middle East, we have only one branch based in Dubai, with offices also set up in the US.

Concerning your question of expanding in Egypt, I think this is something that we can look into, but it depends also on the projects that we will have here in the country and the activities.

Which are the most significant import countries?

It’s difficult to mention certain countries, but I can state that the Middle East is a major importing area for our products.

Daily News Egypt interviewed laurnet Fouche, regional executive export, and sales director for the MBDA, which specialises in designing and producing missiles

Can we estimate how much the Middle East represents for your market?

Up to date, the Middle East represents 25% of our market, of our annual.

To further elaborate, the order to take coming from the Middle East represents 25% of all orders that we receive.

How many factories do you have across the world? Do you have any plans to expand your factories in Egypt?

Currently, we have 10 factories across Europe, while concerning the Middle East we have only an office.

In terms of expansion in Egypt, I think it depends on customers’ needs in Egypt, but we are thinking of partnering with the Egyptian Ministry of Military Production, so that we can strengthen the relationships between the ministry of defence, armed forces, and the MBDA in some missile local production in the future here in Egypt, hence we will start discussions to help the Egyptian side to integrate our products into vehicles for example.

In addition, we will help them to establish an Egyptian system by transferring knowledge and technology, which will subsequently increase autonomy in production in Egypt.

Do you have any negotiations in that subject with the ministry of military production?

No, we are now just at the beginning of studying the partnership and will try to meet the expectations of the ministry of defence, as we understand well that it is an important need for the country.

How do you evaluate the Egyptian market currently?

I think Egypt is taking good steps, including the Egypt Defence Expo, EDEX 2018, which is the first event of this type in Egypt.

Let’s talk about EDEX in depth, including your experience with it, how was it?

I think it was a successful event as the companies that were present in the EDEX were very important companies, and subsequently the level of attendees was very important.

Notably, there is a demand in the region to know the latest technology of the defence industry.

I think the EDEX was extremely good, extremely professional, and the organisation was perfect, and it met our expectation, all the way from the top to the lower ranking officer in MBDA.

In your opinion, how was this event beneficial?

For our own side as a company, the event was very beneficial, to be there, to meet all the levels of highly-ranked officers will contribute towards strengthening our relationship.

To elaborate more, this event was important to strengthen and link relationships between the companies and the ministry of defence, and this kind of event is well spread out across the world, so it was very important for the MBDA to be present here in Egypt.

What are the obstacles that Egypt faces in manufacturing weapons?

The competence and manpower to be part of the sector, hence it needs help from all the different sectors to bring in and transform in knowledge and technology, then after that I think Egypt will face no obstacles to be able to manufacture.

Does the cooperation between Egypt and France in Rafale aircrafts, lead towards increasing orders to take of your missiles?

We have a long experience, and history of relationships between the MBDA and the Egyptian forces, especially the air forces, because in the past, we used to also equip aircrafts and helicopters from air forces to air forces with our missiles.

Thus, the new technology arriving with Rafale, are also equipped with our missiles, so we were part of the deal.

What are the obstacles that you face as a company in this sector?

I don’t see any obstacle to be mentioned.

You don’t face any difficulty in marketing your products?

No, as we are following the international standards to export our products, this is dealt with according to the level of the relationships between the government of the five countries of the MDBA and the customers.

What about the MBDA’s last financial results in terms of revenues, orders to take? And what are its targets?

FOR the MBDA we are achieving the target in terms of revenues, sales, and orders to take.

All these last years, we were around the target of about 3bn in revenues, and orders were around €4bn per year.

Concerning 2017, the MBDA achieved revenues worth €3.1bn, order backlogs were €16.8bn.

In terms of the financial results for 2018, it has not yet been consolidated, but I think that we are on the track to achieve our target.

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Boeing seeks new deals with EgyptAir for more Dreamliner jet airliners Mon, 10 Dec 2018 07:00:05 +0000 Company in talks with Egyptian armed forces to boost cooperation, says Dunn

The post Boeing seeks new deals with EgyptAir for more Dreamliner jet airliners appeared first on Daily News Egypt.

Boeing, an American multinational corporation that designs, manufactures, and sells airplanes, aims to sign new contracts with EgyptAir in order to supply more Dreamliner jet airliners for the Egyptian company, as both companies are in ongoing cooperation talks, Bernard J Dunn, president of Boeing Middle East, North Africa, and Turkey (MENAT), informed Daily News Egypt.

“There are some plans for signing future sales’ contracts with EgyptAir after the Egyptian flag carrier airline recognised the advantages of our Dreamliner jets, and will put them into operation after next March. Hopefully, we will provide EgyptAir with more Dreamliner jets as they to be of proved high quality,” mentioned Dunn.

Daily News Egypt interviewed Dunn; Tim Buerk, Boeing Global Services’ (BGS) director for Middle East and Africa; and Paul Curlett, senior manager at Boeing for international government services, during EDEX 2018, Egypt’s first tri-service defence exhibition covering air, land, and sea, held from 3 to 5 December, the transcript for which is below, lightly edited for clarity:

We know that you met with President Abdel Fattah Al-Sisi during EDEX 2018, what did you discuss?

Dunn: I had the honour of welcoming President Al-Sisi at Boeing’s pavilion in EDEX 2018, and showed him some of our products. We are in ongoing talks with the Egyptian armed forces to boost cooperation and supply the required equipment. I was very honoured to have a short conversation with the president about this issue.

Are there any updates regarding the company’s plans to open a local office in Egypt?

Our plans for opening a local office in Egypt are still alive. We just need to sign a couple of deals first that will allow us to move this step forward.

Would you please elaborate about your plans to open a STEM education centre in Egypt?

We implement an extensive programme called the Boeing Global Engagement (BGE) which primarily focuses on community engagement activities. It comes in line with the company’s commitment towards giving something back to the world markets in which we work.

We gradually increased our BGE work in Egypt during the last two years, as we aim to focus on this market and give it the attention that it always deserves. Meanwhile, we are proud to launch a new edition of the BGE programme, which is a science, technology, engineering, and mathematics (STEM) centre.

It comes in conjunction with the World Learning Organisation, a non-profit international entity which focuses on knowledge, education, and exchanging programmes.

Boeing will allocate a special budget for the STEM Centre in 2019. We expect that it will include 12,000 young people in its first year.

Where will you establish the STEM Centre? 

We have not yet chosen the centre’s location. However, it will be in Cairo because it will suitable for us.

Paul Curlett, senior manager at Boeing for international government services

Do you plan to open more STEM Centres in other governorates?

Yes, we have plans to expand our STEM Centres nationwide but after the first year. We plan to inaugurate three STEM Centres over the next three years. The first will be in Cairo, the second will likely be in Alexandria, and the third one’s location is still under discussion.

What is the expected budget for the planned STEM Centres?

I cannot tell you how much it will be exactly, but it will be large and last until 2021, which illustrates Boeing’s confidence in the market.

What are Boeing’s goals for establishing STEM Centres?

The concept of STEM Centres is to provide a place for young people where they can learn about STEM through interactive online activities, which they can access under the supervision of the centre’s staff. STEM is one of the BGE’s main pillars around the world. It is also a field that President Al-Sisi works on promoting in Egypt. The president wants his citizens to be technologically trained, and capable of working in aviation, as well as other high-tech industries. 

I also talked with various civil society leaders in Egypt, and they would love to see the day when Egyptians can work in international companies like Boeing. The STEM Centre will help to discover young talents and support them with STEM education to change their lives for the better.

Do you coordinate with the Egyptian education ministry regarding STEM Centres?

Sure, we are coordinating with the ministry of education and they are very supportive. Boeing will bear all the expenses of the STEM Centres, without burdening the Egyptian government. The STEM Centres’ target students aged 12-16. The curriculum will be provided in cooperation with World Learning.

Tim Buerk, Boeing Global Services’ director for Middle East and Africa

What are the latest developments of Boeing’s other activities, including those with INJAZ Egypt?

We are implementing other programmes with INJAZ Egypt; the Education For Employment (EFE), a leading youth employment organisation; and the Al-Nour Wal Amal Association (Light and Hope), where we are helping blind ladies to become musicians.

Our cooperation with INJAZ is going very well. We have reached out to a large number of people and helped them to create their own companies during the last two years. Our programmes in Egypt are actually very successful. Egyptian youth are so enthusiastic and desirous.

What about the company’s cooperation with Egyptian universities?

We have a partnership with Cairo University over the last two years. We are in talks with Ain Shams University and Alexandria University over more cooperation agreements. We would definitely like to expand our activities in Egyptian universities similar to the STEM concept which can be a good way to reach out to young people and prepare them for the labour market.

Are there any updates regarding the cooperation with EgyptAir?

EgyptAir is our customer and we are keen on keeping continuous discussions about sales, services, and everything they need. We are in ongoing talks with EgyptAir. We have some plans for future sales contracts.

EgyptAir will add new Boeing 787-9 Dreamliner jets to its fleet next year. The Egyptian flag carrier airline recognised the advantages of our Dreamliner jets and will put them in operation after next March. Hopefully, we will provide EgyptAir with more Dreamliner jets as they proved to be of high quality. Boeing and AerCap announced during the 2017 Dubai Airshow that EgyptAir will lease six Boeing 787-9 Dreamliner jets.

How do you assess the cooperation with the MENAT region in 2018? And what are the company’s 2019 plans?

There are many regional economic and political changes. This is something everybody is aware of. We are in touch with all of our partners and customers. We have sales contracts of about 2,990 new commercial airplanes in this region over the next 20 years. It shows the need for about 63,000 new pilots and 67,000 new technicians as well as 92,000 air crew. It is a growing market.

On 17 July, Boeing lifted its long-term forecast for commercial airplanes as rising passenger traffic and upcoming airplane retirements drove the need for 42,730 new jets – valued at $6.3tn – over the next 20 years. The global airplane fleet will also sustain growing demand for commercial aviation services, leading to a total market opportunity of $15tn.

For defence industries, the Middle East is always a good market, and we have strong coordination with all of our customers

What are the top five regional airlines which purchase your airplanes?

Boeing respects all its customers. However, the top five airlines are Emirates, which is currently the world’s largest operator of the 777 and the only airline that operates all the variants of this aircraft; Flydubai with an all-Boeing fleet; Saudi Arabian Airlines, which operates Boeing twin-aisle airplanes; Qatar Airways, which has the largest 787 fleet in the Middle East; and EgyptAir.

Bernard J. Dunn, president of Boeing Middle East, North Africa, and Turkey

Does Boeing have airplane factories in the MENA region?

We are set to launch factories in the UAE and Saudi Arabia. However, most of our manufacturing is done in the United States.

In April 2012, Boeing and Mubadala announced a 10-year direct contract for Strata Manufacturing, an advanced composite aerostructures manufacturing company wholly owned by Mubadala in Al Ain, to produce commercial composite aerostructures for the 777 and the 787 Dreamliner. Strata currently manufactures ribs for the empennage of the 777 and vertical fin ribs for the 787 Dreamliner.

In 2014, Strata’s first shipset of empennage ribs was installed in a 777-300ER (Extended Range) which was delivered to Emirates Airline. In 2015, Strata’s first shipset of 787 vertical fin ribs was installed in a 787-9 Dreamliner delivered to Etihad Airways. At the 2016 Farnborough Air Show, the companies announced that Strata would expand its work statement for Boeing as a supplier of the 787 vertical fin—a major composite assembly for Boeing’s most advanced airplane programme. Additionally, Boeing agreed to source pre-impregnated composite materials for the new 777X from a new, UAE-based joint venture created by Mubadala and Solvay, making Boeing their first customer.

Also, Boeing is supporting the UAE’s research and development objectives in order to ensure sustainable growth of its booming aerospace industry. In 2016, Boeing and Mubadala signed an agreement to support bilateral research projects conducted at the Khalifa University and the Masdar Institute of Science and Technology.

At the 2013 Dubai Airshow, Boeing signed a partnership with the Tawazun Precision Industries (TPI), an Emirates Defence Industries Company (EDIC) subsidiary, to establish a new aerospace surface treatment facility in Abu Dhabi. The certified, state-of-the-art facility enables the TPI to produce complex metallic assemblies for Boeing, its suppliers, and other aerospace manufacturers worldwide.

At the 2015 Dubai Airshow, the TPI and Boeing announced the first award of complex metallic machined parts for Boeing tactical aircraft to be built at the TPI’s new facility. At the 2017 Dubai Airshow, Tawazun Economic Council and Boeing signed an agreement to expand the UAE’s role by enabling advanced materials manufacturing. 

For Saudi Arabia, Boeing signed an agreement in 2015 with Saudia Aerospace Engineering Industries (SAEI) and the Airports Authority of India (AAI) to create the Saudi Rotorcraft Support Company (SRSC) in the kingdom. The joint venture opened in April 2017 with facilities in Riyadh and Jeddah. Through in-country cooperation, the partner companies focus on expanding the Saudi workforce through the creation of self-sustaining jobs, technical, and aerospace skills development for local workers, and further involvement of the Saudi aerospace supply base. The joint venture supports the kingdom’s commercial and defence rotorcraft platforms, including the AH-64 Apache, the H-47 Chinook, and the AH-6i.

What was the Middle East countries’ reaction towards the Boeing Global Services unit?

Buerk: Our customers were excited about the launch of the Boeing Global Services unit in 2017, Boeing’s newest business unit. It comes in the framework of the world’s largest aerospace company’s commitment to significantly invest in aftermarket service capability innovation. Egypt and the Middle East are priority markets for Boeing Global Services.

Formed by merging the services’ sectors of Boeing’s Commercial Airplanes and Defence, Space, and Security businesses, the Global Services is designed to provide commercial and governmental customers with unprecedented value, and the best experience in the aerospace services industry.

Boeing forecasts that the MENA region’s age of existing military aircraft, and the operating tempo for those platforms, will warrant a $90bn investment in services over the next 10 years. By advancing technologies and systems that support this level of growth, Global Services plans to change the way airplanes and defence systems are operated, upgraded, and maintained throughout the products’ lifecycle.

Curlett: Boeing has a strong platform. We have the best engineers who are capable of providing Boeing’s products and services for both the defence and commercial sectors.

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IATF is an instrument to support continent’s free trade area, 30 agreements expected to be signed Sun, 09 Dec 2018 10:00:35 +0000 Afreximbank disbursed various loans to Egypt exceeding of $2.7bn in diverse sectors in 2018, says Kamel

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Large corporations will participate in their own capacities in the Intra African Trade Fair (IATF) in addition to countries which support small and medium-sized enterprises (SMEs), as over 40 pavilions representing more than 40 countries will be in the fair.

The African Export-Import Bank (Afreximbank) is organising the inaugural Intra-African Trade Fair (IATF 2018) which is being held in Cairo from 11 to 17 December.

The IATF is hosted by Egypt, through the Export Development Authority (EDA), and organised in collaboration with the African Union and several other partners.

Kanayo Awani, managing director (Intra-African Trade Initiative) to discuss the launch of the ITAF and its sustainable plan for Africa transformation

Furthermore, the IATF 2018 is the first of its kind in Africa, consisting of a 7-day trade fair which provides a platform to share trade, investment, and market information, thereby enabling buyers and sellers, investors and countries to meet, as well as to discuss and conclude business deals. 

Moreover, the IATF 2018 will provide an arena for the exchange of information on markets, dialogue, and meetings among businesses. It will also provide traders with opportunities to conclude deals and access information about investment opportunities.

Daily News Egypt sat down with heads from Afreximbank, Amr Kamel, executive vice-president (Business Development & Corporate Banking) and Kanayo Awani, managing director (Intra-African Trade Initiative) to discuss the launch of the ITAF and its sustainable plan for Africa transformation, the transcript for which is below, lightly edited for clarity:

What is the value of funds allocated to Egypt in 2018?

Kamel: This year we disbursed different loans to Egypt exceeding $2.7bn in different sectors and banks receive a large share of these loans. Next year, we plan to provide some transactions in different sectors. Currently, Egypt’s share of the total bank’s portfolio is 24%.

Does the Afreximbank plan to provide new loans to Central Bank of Egypt (CBE) to support foreign reserves?

Kamel: The CBE is a very important partner to us and we cooperate in various sectors together. I do not think that the CBE will demand new funds in the coming period but we collaborate with it in other fields such as facilitating trade in light of our programmes.

What is the size of the funds to be allocated by the bank for Egypt in the coming year?

Kamel: we are studying financing some sectors in excess of $1bn in oil, energy and banks.

What is the size of intra African trade?

Awani: Our expenditures in Africa are about $10bn in diverse sectors to support the private sector, trade and industrialisation in the continent. We are working on a 5-year strategy from 2017-2022 which is called ‘Africa transformed’ as we focus on developing industry and agriculture and transforming Africa.

What are your efforts in promoting sustainable development in the entire continent?

Kamel: As I mentioned obviously, we are a development bank, so all our transactions have to have a developmental angle, as it is a part of what we do in our credit assessment. Consequently, our strategy has several key pillars we rely upon, namely, intra-African trade promotion, industrialisation, development manufacturing, and trade finance leadership and so on.

We have sectors which we think we will a have maximum impact in terms of promoting trade. For example, we try to discover in each country we finance what their comparative advantage is and which sector needs financing and we urge them to manufacture. One of the important things we do is develop industrial parks in Africa, where we look at what these countries have in terms of comparative advantage in manufacturing.

What are efforts were exerted by the bank to facilitate electronic payment of trade transactions?

Awani: the bank is working on the payment and settlements platform. We have exerted efforts to enable payments across Africa, not only in goods, but also in services. We provide a payment gateway to settle issues related to foreign currency. It is not helping African countries to trade with each other but we also deal with issues related to informal trade as we do not say that intra-African trade is low, but about 16-17% is formal trade as statistics reveal, which is considered low. The payments and settlements platform has a special feature, which is that countries can buy and sell in local currency to solve problems in intra-African trade. In the IATF we are going to launch online payment but also by the next year it should have been launched.

What are the most promising sectors in Africa to invest in?

Kamel: Africa has many natural resources. The idea is to try to transform these natural resources rather than exporting them. For example, Africa is the biggest cacao supplier to the world, but, unfortunately, it only receives about 5-10% of the value chain of the cacao industry. Therefore, we work on several initiatives to ensure that instead of exporting cacao, Africa transforms and manufactures it and produces chocolate.

What is the value of financial increase to Africa in the coming year?

Kamel: For our current strategy for 2020-2021, we hope to have a balance sheet of $17bn, however at this current time currently it is around $12bn. We do anticipate to reach that growth level and we have been growing at an average of 15% every year.

Daily News Egypt sat down with heads from Afreximbank

Do you plan to finance new sectors in Egypt and Africa?

Kamel: We are very innovative as innovation is finding what is most in need for funds and thus we found that one of funds which is missing is equity investments, therefore, the bank has set up an Investment Holding company (FUNFED) under its Equity Investment.

In addition, we also discovered some problems related to project preparation as some projects were not properly launched nor properly prepared so for that we have approved a programme called ‘Project Preparation Facility.’ It will primarily ensure that projects do thus type of initial work and then review it with bank’s situation. We continue to make different projects  and different areas according to scope. Project Preparation Facility was launched in March.

Regarding FUNFED it was approved by the bank’s board and we think it will be launched in the first quarter of 2019.

Awani: We have a trade finance initiative to promote finance across Africa in order to fill the gap in trade finance. Besides, we also provide trade finance instruments such as factoring to the continent’s countries.

How many Afreximbank’s member states are there?

Kamel: There is a great demand by the African countries to become bank members. Furthermore, in the last two years, about 13 countries joined the bank and we have reached 50 member states. Moreover, we are in negotiations with Algeria, Libya, Somalia and Eswatini, known previously as Swaziland.

What is the value of the bank’s capital?

Kamel: The Afreximbank’s capital reaches $2.4bn.

What is the value of the credit lines provided to Egypt by the bank?

Kamel: We provided Egypt with more than $11bn credit lines’ value since the bank’s establishment. However, in the last three years only, the bank has provided $10.3bn. Moreover, approximately $2.750bn were provided to Egypt in 2018.

What is the size of fund to be allocated for banks to support SMEs and trade development?

Kamel: We discussed with some Egyptian banks to finance in support of SMES and trade development, and we will allocate about$200m-$300m for banks in the coming year.

Moreover, we agreed with some big Egyptian companies from the private sector that have the ability to enter African markets and play a role in supporting and encouraging investment in Africa such as El Sewedy Electric, Arab Contactors, and Orascom Telecom Media and Technology Holding (OTMT).

In view of Egypt’s reform programme, does the bank plan to provide more funds to the Egyptian government to support it?

Kamel: We have a great and continuous cooperation with the CBE, and we are ready to cooperate with the CBE in sectors that need to be financed. In addition, the bank sometimes provides the CBE with advice on some non-financial topics.

Are there any outstanding loans to the CBE? Are new loans being negotiated?

Kamel: the CBE has paid the value of all loans and there are no current negotiations on loans.

What is the idea behind the launch of  the IATF?

Awani: in light of our strategy for 2021 ‘Transforming Africa’, we are working on promoting intra-African trade. What’s more, we want to increase intra-African trade for it to become more than its current percentage, which is about 15-17%, meaning that about 85% comes from the rest of the world. Therefore, we want to give special attention to industrialisation because  substantial African commodities come from outside Africa. If we industrialise we will sell more among each other because all commodities are produced from natural resources.

Over and above, we work as much as possible to deal with intra-African challenges. We realised that limited information about Africans is one of the main challenges which hinder trade especially regarding information related to what they purchase and which markets sell.

For example, Egyptians do not understand African markets, so what we want to do is to shape the market, which is why we are supporting the launch of the African market. Nevertheless, we need to deal with limited information concerning the market, which is the first reason behind holding the IATF. The second reason related to bringing together buyers and sellers of goods and services is to showcase African investment opportunities.

The Afreximbank has launched a trade information department, one platform providinginformation on trade in the fair. Besides, people can physically attend the fair and can also trade in the fair through that online platform.

How many countries participating in the IATF?

Awani: A large number of corporations will participate in their own capacities and also countries which support SMEs. We have over 40 pavilions representing more than 40 countries.

What are your expectations after ending the fair?

Awani: The IATF is not an end itself. It is just an instrument to support the continent’s free trade area. The continent’s free trade area is supposed to represent one market, a customs market like the EU.

During the IATF, b2b meetings and trade deals are supposed to be signed. What is your role in financing these businesses and the type of finance?

Awani: We provide trade finance and we also partner with some financial institutions to finance trade transactions. Additionally,we provide grantees, finance liquidity, and advisory services.

How many agreements will be signed during the fair?

Awani: Over 30 agreements will be signed throughout the fair.

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NUCA to launch third phase of partnership projects early next year Mon, 03 Dec 2018 07:00:23 +0000 EGP 7.8bn of sales achieved from offering 5 skyscrapers in New Alamein city, says Abbas

The post NUCA to launch third phase of partnership projects early next year appeared first on Daily News Egypt.

Waleed Abbas, assistant housing minister for the New Urban Communities Authority (NUCA) said that the authority has adopted 15 ministerial approvals for projects in the New Administrative Capital, expecting to reach 19 approvals by the end of the current calendar year.

Daily News Egypt interviewed Abbas to discuss the NUCA’s development strategy regarding the new cities, the transcript for which is below, lightly edited for clarity:

The government has recently announced 20 new cities. When will the NUCA deliver the first phase of these cities?

Implementing 20 new urban cities is underway, representing the fourth-generation cities, including several cities, most notably the New Administrative Capital, New Fashn, New Mallawi, New Sphinx, New Obour, New Alamein, and New Mansoura. The NUCA plans to deliver the first phase of the 20 new cities by the end of the fiscal year 2020/21 in preparation to accommodate people in the same year.

Are there any updates regarding the New Alamein sales?

The sales achieved from offering 5 skyscrapers in New Alamein city have reached EGP 7.8bn out of a total of 15 skyscrapers, and will be launched in the city which is being implemented by the NUCA, and City Edge Developments is marketing them.

The city will include housing units for community segments starting from social housing to luxury housing. We believe that a successful city is where all residential segments live in, not just one.

What is current situation of the development process in New Mansoura city?

The first phase of New Mansoura city includes the implementation of the units of the projects Sakan Misr, Dar Misr, and villas. Moreover, we plan to offer units for middle-income housing in the city soon, as the NUCA began to offer projects with an investment return to direct sales proceeds in order to implement facilities’ work and other housing projects in the city.

Furthermore, road development is being constructed to link the cities of New Mansoura and old Mansoura for transportation between the two cities. The road already exists, but the authority is developing it.

Waleed Abbas, assistant housing minister for the New Urban Communities Authority (NUCA)

The government has made great progress in the New Alamein city. Can you explain the current development process?

The government is currently developing 14,000 feddan representing the first city phase, where the NUCA is currently completing the construction and buildings of the National University, in cooperation with the University of Alexandria. Furthermore, 7.5 km out of a total of 14 km of the tourist walkway in the city are completed, and the authority aims to run this walkway and open it to citizens by next summer.

The general master plans for three industrial developers are being implemented with a total area of 625 feddan, and 500 units of the Sakan Misr project are being implemented and will be offered early next year.

Some developers blame the NUCA because it competes with them in offering units for specific segments. What is your opinion?

The residential units that the NUCA offers to citizens are not considered competitive with the private sector’s units, but a means of controlling the prices in the real estate market, and the client is the final judge to choose between the NUCA’s units and what developers offers.

The NUCA offers unit prices lower than developers, therefore, contractors who offer units with high prices must provide additional benefits for their customers.

The prices determined by the authority include the cost of land and the implementation cost as well as profit margins and yet, still they are lower prices than the prices of developers.

How many developers bought booklets of conditions for the last investment offering in New Mansoura and New Alamein?

Four plots of land were offered for urban activity in New Mansoura city, and 16 booklets of conditions were sold by mid-November. Moreover, one plot of land was offered in New Alamein and 14 real estate developers have bought booklets of conditions, which reflects the importance of the location of that plot of land and the flow of demand for investing in the city.

How many ministerial approvals have been issued in the current year and what is the target by the end of the year?

The NUCA has approved 81 investment projects in over 16 cities, spread out over a total of 13,697 feddan.

Moreover, nine other ministerial approvals for new projects will be received before year-end, bringing the total to 90 projects approved by the ministry by the end of 2018.

Additionally, 15 ministerial approvals were issued for projects within the New Administrative Capital, with four more ministerial approvals are expected to be issued soon, bringing the total ministerial approvals for projects in the Administrative Capital to 19 approvals by year-end.

How do you see demand on implementing projects in Upper Egypt?

It is noteworthy that there is increased demand by developers to invest in Upper Egypt and new cities outside Cairo and traditional cities, as the NUCA has many requests for acquiring lands in new cities in Upper Egypt.

The latest investment offering did not meet the expected demand by developers and we found that no one applied to invest in some cities. What is the fate of the development of those cities that no one has applied to invest in?

There are three plots of lands which were offered in Sixth of October City and seven investors have applied, and seven plots of land were offered in Sheikh Zayed city and three developers have applied. In addition, two plots of land in Sohag interested four investors, and three plots were offered in New Assiut by three developers who have applied, and three plots in New Damietta and only one developer has applied, plus only one investor applied for one plot of land out of a total of six plots which were offered in Sadat city, Menofiya governorate. Meanwhile, no developers have applied to acquire lands in New Cairo, New Aswan, Qena, and Akhmim.

The cities that have not witnessed demand or have few requests will be re-examined to determine the reason for the lack of interest through a study by the authority’s development of those projects. We expect to start the launch of the third phase of the partnership projects early next year.

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Tetra Pak: time for a sharp choice cut Sun, 02 Dec 2018 15:56:33 +0000 Egyptian market is very promising with potential and very specific advantages, says Tetra Pak Egypt managing director

The post Tetra Pak: time for a sharp choice cut appeared first on Daily News Egypt.

Tetra Pak, the company specialised in food processing and packaging solutions, believes that the Egyptian economy has been facing many challenges during the past period, according to the Managing Director of Tetra Pak Egypt Konstantin Kolesnik.

Daily News Egypt interviewed Kolesnik to get an insight into how the economy has affected Tetra Pak, as well as his general outlook for Egypt’s forecasted recovery programme, the transcript for which is below, lightly edited for clarity:

To what extent where you affected by the increasing exchange rate of foreign currency?

Foreign exchange rate (FX) is a challenge facing all companies operating in Egypt and it has affected prices of everything.

How long have you been working in Tetra Pak? And how long have you been in Egypt for?

I have been part of the Tetra Pak family for 16 years and now part of Tetra Pak Egypt for more than 2 years.

Where were you located before Egypt?

I joined Tetra Pak in 2000, and since then held a number of different responsibilities within the company. In 2014, I was appointed as the managing director at Tetra Pak Iran. Before that I held different positions in Tetra Pak in the Ukraine, Russia and West Siberia.

What are the challenges you have witnessed in the Egyptian market?

The Egyptian market is a very promising market with a lot of potential and very specific advantages, such as the large population and various diversified market segments. However, there are several challenges such as the shortage in foreign currency and increasing FX rate. The biggest challenges that are directly related to our field are that the consumption of loose milk is still very high in comparison to packed milk, which is why Tetra Pak is constantly working on raising awareness about the benefits of packed milk and the hazards of loose milk through taking part in the ‘Your Health is in this Package’ campaign. The second direct challenge is that the consumption of milk in general in Egypt at 13 litres per capita is still very low when compared to the global average consumption rate at 33.3 litres per capita.

How much are your total investments in Egypt?

Tetra Pak is a privately-owned company by a Swedish family, and is not registered in any stock markets. Therefore, the company does not disclose its investment figures. However, our investments in Egypt are focused on our human resources as we invest in our employees and their trainings to ensure that we are capable of offering our customers the most advanced packaging and processing solutions.

What are you anticipated sales this year and next year?

This year we are expecting to sell 2.3bn packs. As for next year we foresee a further increase in our sales.

Besides packing, what other services do you provide for your customers?

Today, we are the world’s leading company in packaging and processing solutions, and we have the largest portfolio of packages in the world; therefore, this enables us to provide an integrated processing, packaging, and distribution line and plant solutions for food manufacturing. Additionally, we constantly try to provide our customers with the latest innovations and market trends from around the world to offer the highest quality products to Egyptian consumers, and a perfect example of these efforts would be the Innovation Day we are holding today.

Do you have any plans to establish a factory in Egypt anytime soon?

The number of packages we currently produce in Egypt does not allow us to establish a factory; however, we have an ambitious plan to build our first factory here once our production reaches higher levels to make sure the factory is fully utilised. 

Why do you consider yourself Domty’s partner?

We work as one team. We think innovate and accomplish projects together. Throughout 10 years of partnership we have managed to provide Domty with end-to-end solutions including processing, packaging, and services, while maintaining the highest standards of food safety, operational performance, and sustainability. Add to this, we share with Domty market research findings, latest trends, innovations from around the world, and product ideas.

How did this partnership help Domty to grow in the Egyptian market?

The partnership started in 2008 with 4 production lines, 2 products, and 1,300 employees. In 2018, 23 there were production lines, 160 products and 3,263 employees. Domty increased their production capacity from 3m packs in 2008 to 420m packs in 2018. Now Domty was able to expand to 39 new markets across Europe, Asia, and Africa and they are one of the biggest white cheese producers in Tetra Pak in the world.

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Egypt implements unprecedented reforms, yet policy instability, inflation, corruption, government bureaucracy remain challenging: Country Senior Partner at PwC Egypt Thu, 29 Nov 2018 10:00:07 +0000 Strategic location, diversified economy, multilateral trade agreements place country favourably, says Ezzeldeen

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Throughout the past three years, Egypt has been through tough but necessary economic reforms undertaken by state authorities, and supported by the IMF. Aiming to resolve economy’s structural issues, curb the budget deficit, eliminate currency shortages, all while achieving sustainable growth, the Egyptian government has adopted a diversified set of economic measures, including currency flotation, subsidy cuts, imposing value-added tax (VAT), and introducing social protection programmes.

Egypt’s unprecedented reform measures of macroeconomic and business legislation are bearing positively on the country’s competitiveness standing for the first time in eight years, Maged Ezzeldeen Country Senior Partner at PricewaterhouseCoopers Egypt (PwC) told Daily News Egypt.

He said that various opportunities exist in the energy sector ranging from exploration and processing of crude oil, liquefying gas, and exportation of such products.

Ezzeldeen elaborated that the PwC support investors to place FDI by developing their portfolios through building or buying. The PwC is a network of firms with more than 236,000 people operating from 158 countries globally, making them the largest professional services provider in the world.

Daily News Egypt interviewed Ezzeldeen, and the transcript for which is below, lightly edited for clarity:

Which are the main challenges Egypt faces to increase its competitiveness in the region?

Egypt’s unprecedented reform measures of macroeconomic and business legislation are bearing positively on the country’s competitiveness standing for the first time in eight years. Egypt’s ranking on the global competitiveness report witnessed a significant jump of 15 places in 2017. Underpinning this was a remarkable improvement in the public institutions and infrastructure indices, signalling the payoff of significant public investments in recent years. Despite such improvement, Egypt still lags on other important competitiveness drivers. The most problematic factors for doing business in Egypt are policy instability, inflation, corruption, government bureaucracy, and the inadequately educated workforce. In comparison to other countries, Egypt ranked 134th out of 137 countries in 2017 on the Labour Market Efficiency Index, followed by macroeconomic environment (132nd) and Innovation (109th).

One of the greatest challenges Egypt faces is its rapid youth population growth, by 2023 the country is expected to have 3.5 million entrants into the labour force which, if properly supported, could present a great opportunity to build a strong private sector that has been lagging over the past several decades compared to its peer MENA region countries. Similarly, Egypt attempts to fully benefit from its skilled workforce by tapping into start-ups and the technology sector, which has made other parts of MENA, such as Dubai, competitive. Also, the floatation of the Egyptian Pound, although a necessary step, led to a further loss in the economy’s competitiveness, making trade balance issues more pronounced. Another major challenge is the structural imbalances in Egypt’s economy which leads to weak productivity and slow growth of industries thereby decreasing its competitiveness. This is exemplified by the country’s increase in public debt, both internally and externally, which accounts for 106% of GDP. To combat such structural imbalances, it is necessary to put in place and implement policies that support productivity bases.

Corruption and red tape have proven to be continuous challenges in Egypt and have thus limited its competitiveness in the region. However, legal reforms have taken place to create a business environment that is more conducive to transparency and to crack down corruption. These efforts have been made through anti-corruption campaigns which incentivise bureaucrats to make decisions and to eliminate the fear of decision making. Also, Egypt is a member of the Global Forum on Transparency and Exchange of Information and must adhere to certain standards by the third quarter (Q3) of 2019 which further reflects the country’s shift to become increasingly transparent. With regards to red tape, the government is working on establishing a new era of technical and strategic bureaucracy which is expected to reduce red tape.

Another challenge faced by Egypt is the region’s no corporate tax environment making it difficult for Egypt to be as competitive as its regional neighbours.

What are the main three competitive advantages when investing in Egypt compared to the MENA region?

One of the most important competitive advantages is the country’s strategic location. Egypt is on the crossroads between the Middle East and the Far East from one side and Europe and the East Coast of the Americas on the other side. More importantly, the Suez Canal offers the shortest link between East and West for international trade. Another competitive advantage is the availability of human resources on all employment levels, particularly its strong manual labour force making it independent from migrant workers unlike, its neighbouring Gulf States.

Among other competitive advantages, Egypt has a diversified economy compared to its energy dependant neighbouring rentier states of the Gulf. Moreover, Egypt’s population accounts for one-third of the Middle East’s population comprising more than 100 million with a large, young, and growing consumer market and a competitively priced labour force make it attractive to investors.

Egypt is the signatory to an extensive number of multilateral trade agreements, such as GAAT, GATS, PAFTA and QIZ, in addition to bilateral agreements with countries including Tunisia, Morocco, Libya, and Lebanon. These trade agreements present investors with a myriad of opportunities that position Egypt as a strategic trade hub.

Egypt’s policy is positioning it as a global and regional services, production, and re-export hub; creating jobs and economic growth by opening new markets for Egyptian products while simultaneously attracting FDI from corporations looking to harness Egypt’s unique basket of preferential trade agreements, highly competitive labour and utility costs, talented labour force, and proximity to key global markets. Together, these advantages make Egypt an ideal hub from which to export to Europe, the Arab world, the United States, and Africa.

Diversity is a key strength in the Egyptian economy where growth is driven by many sectors, both conventional and unconventional. This enhances the economy’s ability to absorb internal as well as external shocks. It also presents multiple opportunities for investors across many sectors compared to its energy dependant neighbouring GCC countries.

Egypt’s recent significant gas discoveries in the Zohr field in the Mediterranean Sea have further diversified its economy in addition to other discoveries underway such as BP’s Atoll and East Nile Delta projects, as well as Nooros field. Egypt’s hot climate coupled with high wind speeds makes it an ideal hub for renewable energy sources.  By 2022, Egypt aims to shift 20% of energy supply for electricity generation to renewable energy with wind, hydropower, and solar providing 12%, 5.8%, and 2.2%, respectively. Geothermal energy is also playing a key role with the recent agreement between the New and Renewable Energy Authority (NREA) and Ganoub El Wadi Petroleum Company (GANOPE) to utilise geothermal energy to generate power. These recent developments in Egypt’s energy sector are enhancing its position as the potential energy hub, both regionally and globally. In fact, FDI in Egypt’s petroleum sector represented 64.6% of total FDIs during the first half (H1) of fiscal year 2017/18.

Could you please explain to our readers, how can the new Investment Law and Company Law improve the investment climate and offer security for international investors?

The new Investment Law, passed in May 2017, offers foreign investors a plethora of financial, administrative, and tax incentives in addition to safeguards to facilitate the investment process and to protect foreign investors. Some of these incentives include exemption from stamp tax, fees of notarisation, and registration of the Memoranda of Incorporation for five years from a company’s registration day. Investors are also exempted from contract fees for company registration and 2% on overall customs tax on the value of all imported machinery, equipment, and devices required to set up companies. Moreover, in order to facilitate and encourage the development of various industries, foreign investors are able to import casts and moulds to manufacture products with no customs duties that are to be re-exported after being introduced and implemented. In addition, investors are given discounts on investment projects made in Sectors A and B of 50% and 30%, respectively. Sector A comprises of underdeveloped areas with a high level of poverty and unemployment rate in addition to zones, such as the Suez Canal Economic Zone and the Golden Triangle Economic Zones. Sector B entails small and medium-sized enterprises (SMEs), renewable energy projects, tourism projects, and infrastructural projects. The aim of these discounts is to encourage development, reduce income inequality, and create jobs.

Furthermore, safeguards put in place involve ensuring similar treatment of foreign investors equal to that of national investors and granting them immediate residency in Egypt throughout the duration of their project. A particularly progressive safeguard is that investment projects can not face nationalisation, providing investors comfort towards the government. Foreign investors are also allowed to own an investment project, profit and transfer related profits without restrictions.

Most importantly, the unifying notion of the law is to cut bureaucracy, promote fair competition, combat antitrust practices, and ensure transparency to ultimately make Egypt’s investment climate appealing to foreign investors. It is evident that Egypt is reaping the benefits of the new Investment Law through a promising rise in foreign direct investment by 15% in April 2018.

Which are the key sectors in which foreign investors can find unparalleled opportunities in Egypt?

Egypt has many resources that have made it appealing to foreign investors. After the discovery of Egypt’s massive Zohr natural gas field, the country has been placed on the international energy map. The Zohr field is the first mega discovery in the Mediterranean area with proven reserves of 30tn cubic feet making it a real jewel to the Egyptian economy and a very promising step for energy self-sufficiency and for further explorations to the Egyptian territorial waters in the Mediterranean. Various opportunities exist in the energy sector starting from the exploration and processing of crude oil, liquefying gas, and export of such products. There are other various discoveries whether in gas or crude oil underway such as BP’s Atoll and West Delta Nile projects, as well as Nooros field, which are enhancing Egypt’s position as the potential energy hub of the region and a key player on the world energy scene.

Real estate in Egypt, unlike the region, has been continuously expanding and we have been witnessing an unparalleled real estate appreciation in the last two decades. In 2017, the real estate sector has contributed to 10% of GDP and 15% of total investments in the economy, positioning Egypt as second in the region with regards to real estate investment returns. Despite the decreased purchasing power resulting from the devaluation of the Egyptian Pound, an influx of foreign investment in the sector was evidenced exemplified by an increase of 90% of Egyptians living in the GCC countries after floatation. Various Arab investors who are concerned about the unstable political climate in their countries, such as Libya, Yemen, Iraq, and Syria are investing. Also, the New Administrative Capital and Alamein City are vivid examples of how a new city is coming to life with all its infrastructural requirements.

Although still lower than pre-2011 levels, Egypt’s tourism sector is strongly rebounding (37.7% real growth in FY 2017/18) and tourism receipts posting 123.9% increase compared to the previous year. With continued political stability, Egypt has the potential to captivate its fair share of tourism regionally as well as globally.

Moreover, Egypt has the largest education system in the MENA region at both the school and higher education levels. Egypt has observed a significant increase of 32% in enrolment rates over the last decade. Foreign investors can benefit from the education opportunities as demand exceeds the current level of supply in the country’s education sector.

Also, the country’s recently passed universal healthcare covers all citizens with world-class quality service offerings. The bill aims to cut high medical costs of the private sector and increases efficiency. It will first be implemented in five governorates and then further spread across the country in the coming years.

The information and communications technology (ICT) industry has remained remarkably resilient post the 2011 revolution, recording 10.4% annual real growth in FY 2017/18. Beyond the basics of national internet infrastructure, Egypt offers a number of benefits for potential ICT investors, among which its proximity to the lucrative European markets.

In 2016, Egypt was shortlisted for the Outsourcing Destination of the Year globally by the European Outsourcing Association (EOA). The relatively high computational efficiency and multilingual skills of Egyptians sheds light on the 50,000 employed in offshore BPO and the 40,000 in regional outsourcing in 2015 alone in addition to the ICT sector contributing to 4.1% of GDP. This has positioned Egypt strategically to further attract BPO contracts making it a hub for outsourcing activities.

The food and beverages sector has also appeared promising through an increase in local restaurant and café services. These include chains, such as Mori Sushi, Nola’s Cupcakes, and Bocca which have decreased the need for franchises to set up in Egypt.

How are you planning to benefit from a cheaper Egyptian Pound as the main driver to attract foreign private investment?

Despite the competitiveness gains brought about by the cheaper currency following the Central Bank of Egypt’s (CBE) decision to shift to a managed-float exchange rate regime and country’s unprecedented macroeconomic and legislative reform measures implemented over the past two years, foreign direct investment in Egypt remain lacklustre, contracting by 2.7% on annual basis in FY 2017/18. A material boost to the FDI is awaiting further consolidation of the fiscal accounts and deeper reforms to the business environment.

Nevertheless, a cheaper Egyptian Pound has made Egypt very competitive in several areas. Many efforts are underway to implement import substitution by encouraging local manufacturing and thus export. Egypt has already seen improvements in export activities demonstrated by an increase of 14% in H1 2018 which has made it more competitive. Also, a cheaper currency gives foreign investors more equity for the investment compared to Egypt’s Gulf Mena-peers. Egypt, also plans to take advantage of the Egyptian pound by marketing itself as a cheap tourist destination exemplified by low ticket and hotel rates for inbound tourists allowing them to gain more for their money. In addition, a cheaper Egyptian Pound allows foreign investors to benefit from the country’s low-cost human resources on a broad spectrum of employment giving it a competitive quality.

What do you think are the main concerns of foreign investors to come and do business in Egypt (beyond safety)?

We can proudly say that safety has been restored in Egypt evidenced by the increase in the number of tourists arrivals by 30% in Q1 2018 compared to that in 2017 and 730,000 tourists in February 2018 alone, making it no longer a main concern. A major concern to foreign investors could be the instability in Egypt’s policies which are often amended. This is exemplified through Egypt’s tax system which remains a source of discomfort to investors as numerous changes have been made to its tax code as a result of the country’s past political instability. The tax code’s complexity and difficulties with tax administration mean that companies often face uncertainty about how tax collectors will interpret the law. Many investors are therefore unable to make long-term decisions as they can not plan effectively for their tax treatment. However, the increased level of stability in the Egyptian cabinet and its leaning towards reform, point to the possibility that tax administration might be clarified. Similarly, the safeguards put in place through the new Investment Law offer protection for foreign investors, for example, investment projects can not be nationalised by the government. Moreover, as part of economic reform, Egypt passed its first Bankruptcy Law in January 2018, which further protects foreign investors in the event of bankruptcy by eradicating imprisonment and simplifying post-bankruptcy procedures.

Furthermore, the country’s underground economy, which accounts for 40% of the Egyptian economy, creates an unlevelled playing field and decreases the competitiveness of investors that adhere to the law. This represents a major issue for foreign investors as they do not participate in tax evasion and have different margins to those in the informal sector. The crowding out of Egypt’s private sector, particularly in the construction industry, also limits foreign investor’s chances to compete in the sector.

The lack of a solid legal and regulatory framework in Egypt makes foreign investors apprehensive as they would encounter difficulties to gain justice and would need to resort to the costly solution of arbitration to settle legal disputes. Similarly, while the legal system supports foreign investors to enter Egypt, it presents difficulties in the event of exiting the country reflecting a Hotel California model. Therefore, it is imperative to improve and accelerate the settlement of disputes which is an issue that the new Investment Law tackles. Measures to achieve these goals would have a significant effect on investor confidence. The first step towards this goal would be to call on additional expert witnesses who are well versed in aspects of financial services. This would require judges to become specialised in the financial sector and might even require the formation of a separate court under the auspices of the Egyptian Financial Regulatory Authority (FRA). This would greatly accelerate the judicial process, reducing costs for all parties involved. This would allow foreign investors to enforce their rights in a timely manner and enhance their confidence in the country’s business environment.

Furthermore, the devaluation of the Egyptian pound has not only pose an issue to foreign investors with regards to the value of their investments decreasing by more than half, but also presents an issue regarding high borrowing costs on loans.

Moreover, the World Bank and IMF’s intervention in the economic decisions in Egypt could be a major concern to foreign investors, exemplified by the decrease in subsidies for energy. However, the elimination of energy subsidies may allow for improved resource allocation.

What are your main concerns in regard to reducing the red tape?

It is the government’s role to ensure investors that the new Investment Law will be enforced and red tape will be fought in an effective way. With the current government support to investors and determination to succeed, we believe the red tape will be reduced significantly.

The concept of a one-stop shop for establishing a company, although has helped to expedite the process of starting a firm, has not solved the underlying issue, as firms still need to obtain a majority of the permits, licenses, and approvals from multiple authorities and ministries in order to begin operations. The time spent in obtaining those can often delay projects for months, even if only one or two licenses remain outstanding. In order to reduce the red tape on the firm establishment to have all interactions with businesses take place through this single authority, rather than simply placing multiple authorities in a single location, which is the approach that the ‘one-stop shop’ uses.

Furthermore, redundancy in the deeply entrenched layers of bureaucracy is a major source of red tape, however, the concept of a one-stop shop aims to eliminate such inefficiency.

Could you share with us the story of PWC in Egypt and your main strategy in the country?

PwC was formed in 1998 by the merger of two legacy firms, Price Waterhouse and Coopers and Lybrand. The PwC later acquired Booz and Company in 2014 to make it part of its network. The PwC office in Egypt was established in 1974. Our office in Egypt includes 13 partners and 395 professional staff working in Cairo and Alexandria.

Our ambition is to be the largest and most professional services firm in Egypt that delivers a distinctive experience to our clients and stakeholders. We aim to be the firm of choice for our clients, to offer a nurturing yet challenging environment for our employees and lastly to be an active supporter of our community. Moreover, we support the government with transformational projects and support SMEs initiatives through our strong leadership qualities.

Our strategy is embodied in three core objectives that guide our behaviour and decision making, firstly to enhance the engagement internally amongst our teams, secondly to invest smarter in our clients, talent and infrastructure to ensure sustained leadership in our market, and lastly to excel in our market in order to achieve continuous growth, profitability and quality. Our people have a detailed understanding of the local market, business standards, and culture, and are passionate about working in one of the most exciting and dynamic places in the Middle East.

How can PWC encourage international investors to inject FDI in Egypt?

PwC is proudly a network of firms with more than 236,000 people operating from 158 countries globally, making us the largest professional services provider in the world. We support investors to inject FDI by developing their portfolios through building or buying. Building entails providing clients with market assessment and financial feasibility study. Buying involves offering clients financial tax due diligence of a target firm, valuation of business, internal setup of policies and procedures, audit tax compliance, post-purchase support with a 100-day plan, and exit strategies along with other services.

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MBG to complete marketing of Pukka project in New Capital by end of 2019 Wed, 28 Nov 2018 09:30:25 +0000 The company plans to participate in several foreign real estate exhibitions to promote sales for foreigners

The post MBG to complete marketing of Pukka project in New Capital by end of 2019 appeared first on Daily News Egypt.

MBG plans to direct EGP 500m investments in the Pukka project in the New Administrative Capital, according to Mahmoud Al Adl, chairperson of MBG.

Daily News Egypt interviewed Al Adl to talk about the development process of the company’s projects in the new capital, the transcript for which is below, lightly edited for clarity:

What are the updates regarding Pukka project?

The company has begun earth works of the project, after obtaining the ministerial approval for the project implementation, to begin construction works of the first phase in the beginning of the coming year. The contract with the Administrative Capital for Urban Development company (ACUD) obliges companies to develop at least 10% of the project within the first phase of the project, and 30% for the next 3 years, with completion of the project within 4 years.

The project’s investments are estimated at EGP 4bn and is it being developed on 50 feddan, 9 of them are specified for the roads, It is located in the heart of the Capital, close to at the new Nativity of Christ Cathedral. The construction area of the project represents 22.5% of the total project’s size, and the rest of the space, 77.5%, is allocated for green areas, landscape, squares, and a commercial mall. The project includes 50 buildings, comprised of 1,700 units with sizes ranging between 800 and 900 sqm consisting of eight floors.

What is the value of investments will be directed in the project in 2019?

The company plans to direct approximately EGP 500m in the project in the coming year.

What is value of the project’s targeted sales?

The company aims to achieve sales of EGP 2.5bn next year, compared to achieved sales of EGP 2bn within a year of its launch.

What is percentage of the project marketing so far?

The company has succeeded in marketing about 50% of the total units of the project.

What is the update regarding the mall inside the project?

The company will begin the implementation of the mall in the beginning of the coming year. Furthermore, the company has launched it for marketing a month ago and has marketed 15% of the commercial part of the mall. The mall will include commercial, administrative, and medical activities.

The mall spans over 18,000 sqm with net building area of 6,000 sqm, and comprises of three floors and the company has allocated 4,000 sqm for commercial activities, 1,000 sqm for medical activities, and another 1,000 sqm for administrative activities.

What is the source of the project funding?

The project is self-financed by the shareholders, who are investors, and also the project sales.

What is value of the project’s target revenues?

The project’s target revenues amounted to EGP 5bn, which the company aims to achieve based on the strength of Egypt’s real estate market, and the great demand by the customers, especially in the New Administrative Capital, as one of the new urban communities supported by national and investment interest.

What is the company’s expansion plan?

The company is negotiating two plots of land with a total area of 130 feddan in the North Coast and Ain Sokhna, as the company plans to get one of them to implement a residential tourist project in one of those areas. It is expected to agree on one plot of land before the end of this year, in preparation for the launch of the project next year. One of these two plots of land is located in the North Coast on an area of 100 feddan and the other on 30 feddan in Ain Sokhna. Moreover, the company plans to diversify in land portfolio in the Capital and coastal areas.

How do you see the role of the government in the sector?

I call upon the state to implement comprehensive development projects which not only focus on the real estate sector but also on implementing new projects in the agricultural and industrial sectors in order to achieve strong growth rates. Implementation of this great volume of real estate projects may adversely affect the operations of the real estate market.

Do you think that the market faces decreased sales?

The stability or the decline of purchasing power of customers during the previous period was associated with general economic difficulties, as a result of the economic reform procedures which were taken by the government, yet, will benefit citizens in the coming period. Therefore, the real estate market depends on improving the general economic situation in the country, and improving the customers’ financial ability.

Nevertheless, the real estate market has so far been able to meet challenges, and citizens continued to buy because of a real demand based on the increase in population. Noteworthy, purchase for investment purposes has recently declined since the launch of high-yield savings vessels.

I believe that real estate companies continue to innovate new marketing solutions to support customers to take decisions to buy property and maintain sales operations, especially with the continued absence of mortgage financing system—a role that should not take long to maintain cash liquidity for those real estate companies. Thus, the state is required to intervene to review the mortgage finance system as one of the sector’s development mechanisms.

I want to confirm the high volume of competition between companies in the New Administrative Capital, a pressuring all companies to imitate each other in payment systems, which may be a burden on them, but they are all obliged to do.

Do you think that the government’s offering for real estate projects in New Capital, New Mansoura and New Alamein will affect the company’s sales in these areas?

It is not a competition with real estate developers who implement units for the same residential segment in the same areas, because Egypt is a large market and can accommodate all real estate projects produced by all companies.

What are the distinct activities that the company will provide in its project in the New Administrative Capital?

What makes Pukka unique is the prime location, green areas, event lounge, swimming pools, clubhouse, solar system panels, pet care service, premium mall, health club, spa, and a food court.

What other projects is the company developing?

We are developing several residential villages in the cities of Damietta, Mansoura, and Ras El Bar. In Ras El Bar, we have three villas: Sunset Festival, Sunset El Nakheel, and Sunset Gardens. In Mansoura, we have Al Oula City on 27,000 sqm and a World Trade Centre on an area of ​​20,000 sqm, in addition to the International Medical Centre on an area of ​​10,000 sqm consisting of specialised medical centres on the Nile in Mansoura city.

What is the company’s expansion plan?

I believe that the future of real estate investment is in the New Administrative Capital. From my experience, I see that all investors and clients have an eye on the Capital, and I think investment in the Capital will last for over 100 years.

What is the engineering consultant office?

Since we contracted with the Administrative Capital for Urban Development company, we planned to be unique in our designs, then, we contracted with one of the most famous offices in this sector. We assigned Raafat Miller Consulting to design the project.

What is the company’s plan to participate in foreign real estate exhibitions?

Participating in real estate exhibitions is very important to promote companies’ sales and to allow developers to expand, as well as boost hard currency in the country.

Therefore, the company plans to participate in several foreign real estate exhibitions to promote sales for foreigners, mainly real estate exhibition in Melanoma, Italy.The company targets about 15% of the project’s sales to foreigners.

How do you view the competition between developers within the New Administrative Capital?

There are too many developers in the Capital who launched their projects which led to fragmentation of purchasing power of the customers. Besides, the state offering for a group of projects in different places at the same time contributed to the fragmentation and weakening of purchasing power.

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King Salman Bridge between Saudi and Egypt awaits international approval: Bin Mahfouz Tue, 27 Nov 2018 09:00:04 +0000 Upcoming partnership between Aramco, SABIC with public business companies to execute large export-oriented projects

The post King Salman Bridge between Saudi and Egypt awaits international approval: Bin Mahfouz appeared first on Daily News Egypt.

Since Saudi investors’ visit to Egypt in March, several companies were established worth more than $8bn, said the Head of the Saudi Egyptian Business Council, Abdullah bin Mahfouz, in an interview with Daily News Egypt during his visit to Cairo on Monday accompanying the Crown Prince of Saudi Arabia Mohammed bin Salman.

“We believe that Egypt has achieved the highest growth rate in the entire Middle East, including Saudi Arabia and the UAE,” he stated

Bin Mahfouz pointed out that the Saudi investments that flowed in the past months were carried out by a large number of prominent Saudi businesspersons, including Abdulrahman Hassan Sharbatly, Abdullah Al-Othaim, and Khaled Al-Ghamdi, in various fields across different regions, especially the Suez Canal and Sharm El-Sheikh.

He said that the delegation accompanying the Saudi Crown Prince listened to the speech of the Egyptian Minister of Investment and International Cooperation, Sahar Nasr, at the recent Davos in the Desert, conference which briefed the economic achievements of Egypt, recent agricultural and industrial investments, and the opportunities available in southern Egypt.

“We showed interest in investing in the region, which has tourism and mining opportunities,” he added.

Bin Mahfouz noted that, “This is our sixth visit to Egypt since 2013. We want to review the achievements of the kingdom’s investors in tourism, real estate, and industrial projects that were implemented after these visits, as well as discuss opportunities in other sectors, particularly agriculture, mining, health, and education.”

He predicted that Egypt will witness major investments in the health and education sectors in the coming period for their great need for development. He said that these sectors require foreign rather than Arab investment, since foreign countries have the technology and knowledge, as was the case in Jordan.

He added that investment in the health sector requires a clear investment map for the sector that guarantees investors that laws and regulations will not change, such as the new Investment Law, which is valid for 50 years.

He pointed out that serious discussions held between the Saudi and Egyptian governments on a mining partnership, to which the kingdom gave particular importance and allocated huge investments, particularly aluminium, phosphate, and gold.

“Saudi Arabia has finally realised the importance of phosphate, aluminium, and gold mining, and invested $55bn in this sector. The three elements are available in northern parts of Saudi Arabia and southern Egypt, and I hope to cooperate in this field both at the level of governments and private sector,” Bin Mahfouz said.

He said that the Saudi private sector always accompanies Bin Salman in his foreign visits to benefit from investments that can be implemented in various sectors. The current visit to Egypt will seize any investment opportunity to implement new projects.

During its visit to Egypt, the Saudi delegation will focus on investment opportunities in the tourism and mining sectors, as well as projects in the New Administrative Capital and the Suez Canal.

The Saudi-Egyptian Business Council is planning to increase the kingdom’s investments by at least 10% per annum, but this interest is accompanied by a stronger desire for added value for those investments to Egypt, he said. “Saudi investments can only be secured to output high quality that can be exported.”

Bin Mahfouz expressed his desire to boos cooperation in the petrochemical sector. “Egypt is the kingdom’s gate of exporting to Europe by virtue of its foreign agreements. If Aramco and SABIC succeeded in taking an important and strong position in Egypt, the Saudi private sector can invest in medium-sized projects with $50-100m.”

He added that the current period is seeing joint talks for the implementation of pharmaceutical and petrochemical projects. The coming days will witness the signing of some agreements and cooperation protocols between Aramco and SABIC, as well as other companies in the pharmaceutical sector.

He explained that the Saudi and Egyptian companies, if agreed, will implement large projects in the pharmaceutical sector aimed for exporting to Europe and Africa.

“As a Saudi business community, we are waiting for Prince Mohammed bin Salman’s visit because we know that it will witness the signing of several major agreements that will be announced during the visit,” Bin Mahfouz stated.

“We are now using Egypt to enter the European and African markets. We have been very late in expanding in Africa, allowing other countries to reap most of the benefit and replace us.”

He pointed out that there are many areas for partnership, including pharmaceuticals and communications, in Egypt.

He remarked that Egypt is producing high quality medicines but its exports are still very low, and that there are discussions underway to register Egyptian medicines in Saudi Arabia and the UAE at different prices.

Egypt’s medicine exports reached about $300m annually to different countries that purchase the production at local prices.

Bin Mahfouz discussed the situation of the suspended agreements between Egypt and the kingdom which were signed during King Salman’s visit to Cairo in mid-2016, which witnessed pledges of investments worth $23-25bn.

He said that about $1.5bn out of $2.5bn have been allocated for Sinai development projects, while the remaining funds will be disbursed in 2019 and 2020.

The Sinai development project agreement includes the construction of a three-phase wastewater treatment plant, the implementation of residential communities in Phase II, and the construction of the 90 km-long development axis, as well as four road links with a total length of 61 km, linking the development axis to the coastal road.

The agreement also includes the implementation of the Taba Road, King Salman bin Abdul Aziz University in Al-Tur in Phase II as well, Al-Gady Road, 13 agricultural projects, and a canal for transporting water to the peninsula.

Bin Mahfouz pointed out that the agreement on the construction of the bridge between the two countries, known as the King Salman Bridge, is subject to the implementation of an international political decision, stressing that it will bring about a qualitative leap in the joint relations between the kingdom and Bahrain.

He added that in order to implement the bridge, some design and construction procedures still have to be completed, noting that all this requires an international resolution and coordination with several countries such as Russia, America, China, and India because it is an international corridor.

“We need to coordinate with those countries before proceeding with implementation. The date for this will be determined by the governments of Egypt and Saudi Arabia.”

The agreements signed during King Salman’s visit included the construction of a bridge connecting Egypt and the kingdom with a length of 30 km and a width of 36 metres, in addition to a double railway line in the middle of the bridge with a width of 11.30 metres allowing the passage of trains at 250 km/h.

According to the agreement, the bridge extends from the north of the Egyptian city of Ras Nasrani, near Sharm El-Sheikh, to the eastern shore of Ras al-Sheikh Humaid, north of the port of Daba, passing through Tiran Island in the Red Sea.

Bin Mahfouz expected to activate the Egyptian-Saudi investment fund, which is included in the agreements, soon, without specifying a date.

He said: “This fund is of particular interest to both countries, because it will push the joint investment to record levels, especially as it will be one of the largest Arab investment funds.”

He added that the activation of the fund is an economic decision and not a political one, and it will include major assets of both countries, so was delayed.

The agreements signed during King Salman’s visit included one to establish a Saudi-Egyptian investment fund with a capital of SR 60bn, to be financed by the Saudi Investment Fund, its affiliated entities, and the Egyptian government, and its affiliated entities.

Bin Mahfouz revealed the decision of Saudi businessperson Sheikh Saleh Kamel and 32 other investors in the kingdom to liquidate Gosoor El Mahaba company, whose establishment began in 2014 and was completed at the end of last year with a capital of EGP 6bn.

He said that the company’s operational steps showed no economic feasibility, so it was agreed to be liquidated and allowed all its investors to form smaller companies and invest in all the logistics services provided by the Suez Canal.

“Instead of one company, there are more than 30 smaller companies with a collective capital of EGP 6bn which will afford more success,” he added.

“The company was established with a large capital based on good sentiments and intentions. But the business process showed bad economic viability, so we decided to liquidate, and leave Saudi investors to make individual investment decisions alone with foreign partners to implement projects in the Suez Canal.”

The company was established to invest in Suez Canal services, ship maintenance, and the exploitation of shipping lines, transporting goods between the Suez Canal and Arab and African countries, and providing various logistical services.

He pointed out that the kingdom of Saudi Arabia continues to increase its investments in the Egyptian market, and when it announced in 2017 that there was an increase in investments, it was marketed as a “media talk.” But the fact is that these visits resulted in the establishment of 229 new companies in the period from March and November with capital of $8bn.

“Egypt is a land of goods. It has an attractive environment for investment from God, fertile soil for all countries, attracting Saudi and foreign investments and enjoying great growth,” said Bin Mahfouz.

“Citizens may not feel the impact of these long-term economic reforms, but we as Gulfis look at them and see that they are on the right track, even with the problems of rising prices and foreign currency shortage, but the situation is being properly addressed,” he said.

He continued: “We believe in investing in Egypt more than the Egyptians, who do not believe in it. We achieve greater success. People can follow the results of the work of Gulf companies . Every pound in Egypt is fruitful.”

He pointed to some of the measures taken by the kingdom under its 2030 plan, including the trend towards Saudization of some professions and its impact on Egyptian labour. He said that the number of Egyptians in the kingdom is about 1.9 million, and if some of them return, they will bring benefits to Egypt thanks to the advantageous experience they gained in Saudi Arabia.

“Countries do not benefit from foreign currency remittances abroad as much as they have benefited from the experience they have gained in development,” he added.

He urged the need to amend the Arab-Arab cooperation strategies and should be in large and huge industries such as petrochemicals and mining, while other sectors such as tourism and real estate have not achieved any success at the level of employment.

The post King Salman Bridge between Saudi and Egypt awaits international approval: Bin Mahfouz appeared first on Daily News Egypt.

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High-level Japanese business mission to visit Egypt early 2019 Mon, 26 Nov 2018 07:00:37 +0000 I am expecting further increase of Japanese tourists to this country: Japanese ambassador to Egypt

The post High-level Japanese business mission to visit Egypt early 2019 appeared first on Daily News Egypt.

Masaki Noke, Japanese ambassador to Egypt said that a high-level mission is expected to visit Egypt early 2019, adding, “Japan External Trade Organisation (JETRO) has an idea to send a mission to Egypt early next year, including representatives from the major Japanese companies as well as JETRO officials.”

On the occasion of the Japanese embassy in Egypt celebrating the National Day today, Daily News Egypt interviewed Noke, to shed light on the diversified aspects of cooperation with Egypt including trade, investments, economy, tourism and culture, the transcript of which below, lightly edited for clarity:

Initially, would you give us a briefing about your past experiences before coming to Egypt in September?

Immediately before coming here, I was working at headquarters of Japan’s cabinet office as director general for International Peace Cooperation. Before that I was at Japan’s Foreign Ministry as a director general for the Consular Affairs Bureau.

I arrived at Cairo in September so only two months have passed, however, I have a very positive impression of this country and the Egyptians.

Since September, what are the meetings you have attended with Egyptian officials?

On the 22 of October, I presented my letter of credentials to President Abdel Fattah Al-Sisi, then I had a number of meetings with government officials and with Prime Minister Mostafa Madbouly.

One of my immediate jobs after my arrival was to accompany Egypt’s Foreign Minister Sameh Shoukry for a visit to Japan from 4 to 6 of October, so I attended all the key meetings he had there with the Japanese Prime Minister, vice prime minister as well as finance minister.

Shoukry came to Japan to participate in the Tokyo International Conference on African Development (TICAD) ministerial meetings, and also paid Japan a bilateral visit. Shoukry had very good and strategic dialogue with our foreign minister.

Shoukry headed to Tokyo on 4 October on a bilateral visit to discuss joint cooperation and regional issues of common interest and to take part in the ministerial meeting of the TICAD, scheduled on October 6-7 in order to promote cooperation between Japan and Africa, and to support the continent’s comprehensive development efforts, according to a past ministerial statement in October.

What about your meetings with other Egyptian Ministers?

On the economic front, I met with the ministers of finance, Minister of Transport Hisham Arafat, Minister of Trade and Industry Amr Nassar, Minister of Investment and International Cooperation Sahar Nasr, Minister of Youth and Sports Ashraf Sobhy, Minister of Education Tarek Shawkey, Minister of Higher Education Khaled Abdel Ghafar, as educations is a key area of our joint cooperation with Egypt.

The antiquities subject is very important, so I met with the Minister of Antiquities Khaled El-Anani three times. I also had many other meetings with senior government officials. I participated in a very big seminar on Japanese history held at Cairo University where I met with experts on Japanese language not only from Egypt but also from Arab countries.

As for the future meetings, we are still in the process to meet ministers I have not met yet, so there will be many meetings.

Additionally, I have already visited some of the Japanese companies operating in Egypt and the Suez Canal zone. One important meeting I held was with Imam of Al-Azahr Ahmed Al-Tayeb, and this meeting was very impressive for me.

During your recent meetings with the Japanese companies’ representatives, How they assess the Egyptian investment climate?

Generally, Japanese companies are very positive about their investments in Egypt, as there is huge potential in the Egyptian market. There is a growing population of about100 million citizens. Egypt’s macroeconomic figures are improving so there is very good and positive general trend.

At the same time, the companies’ expansions and new companies’ investments depend on their own researches and studies. However, some companies face challenges like bureaucratic procedures, tax measures, trade policy and so on. What I do now is to exchange views with Japanese companies. We ask Minister of Finance Mohamed Moeit to pay attention to the customs issues and facilitate our investment and activities.

What was the response of the finance minister on the issues that face some of the Japanese businesses?

He was very keen on helping the companies to solve the issues. The Egyptian government is listening carefully to Japanese companies and government voices, and this is an ongoing process. I look forward to additional decisions that take our concerns into consideration.

How do you assess the political and economic cooperation between both countries?

Actually, our joint relations are excellent, and we have been enjoying positive and historical relations. Exchanging high-level visits was a boost towards our relationship as in 2015 Prime Minister Ape visited Egypt and President Al-Sisi came to Japan in 2016, which was the first presidential visit in 17 years.

During President Al-Sisi’s visit, an important declaration was announced, one of the fruits of that cooperation is the most recent visit of Foreign Minister Shoukry to Japan. The visit provided a strategic dialogue between both countries, so it is a key mechanism of boosting political cooperation between both countries.

Additionally, we have a very good record of economic cooperation, including joint cooperation in the opera house establishment, and the Suez Canal bridges. we are now working on two significant projects which are the introduction of the Japanese Education System and the Grand Egyptian Museum (GEM ) where the Japanese and Egyptians are working seriously.

On the economic front, I would like to emphasise the role of the private sector. Many Japanese companies are already working here, and there are about 50 Japanese companies in Egypt.

As a trade partner, Egypt is already a good export destination, but the amount of trade exchange is still modest, roughly 100bn Japanese yen which is less than $1bn.

What about the trade and business missions between Egypt and Japan in 2019?

There is an idea from the JETRO to send a mission to Egypt early next year, including representatives from major Japanese companies as well as JETRO officials.

There is a framework of joint economic committees between Japan and Egypt, so on the occasion of the JETRO mission, the Japanese chamber of commerce is expected to organise a meeting for the Egypt-Japan economic committee.

How many Japanese companies are expected to participate in the coming mission?

It is still in the early stage, so I have no idea, but it is not about the number. There are major companies like Toyota, Tsusho, and other trading companies and manufacturing companies are usual members. Major car automakers are included as well as light industries and banking sectors. So, it will be a cross sector visit.

What about the future official visits between both countries?

About the official visits between both countries in the future, just until yesterday, high-level officials visit Egypt including the senior vice minister for environment, who participated in the Biodiversity Conference in Sharm El-Sheikh.

I don’t have a concrete calendar of the future visits. However, I expect that 2019 will witness many visits between both countries as Egypt is going to take the presidency of the African Union (AU) next year and Japan will host the at the end of August, that’s why both countries have to consult and cooperate a lot.

For the GEM, would you please elaborate about the project’s updates?

Actually, I visited the GEM three times since my arrival in September, and I witnessed the seriousness of the work which is being conducted on there. Our current target is to fully open it in 2020, so we have to work on the constructions of the facilities, preparation for management, the services and software.

About Metro line 4, there were some rumours that there are some issues?

The National Tunnel Authority is under consultations with the Japanese side on some technical discussions. I hope the project will be launched as early as possible and I do not care about the rumours.

Does the Egyptian government discuss with you any new development projects?

There are lots of developmental projects going on and under discussion. Infrastructure is key that is why we finance the Borg El-Arab International Airport Project. We are now implementing the project’s expansions and introducing top level environmental technology in solar energy.

Would you please elaborate more about the cooperation in improving Egypt’s educational system?

We have been active in the area of education and high education for a long time. In 2009, We opened the Egyptian Japanese University for Science and Technology (EJUST) which is a top-level university in the area of science and technology.

Now we are working on enlarging EJUST to develop the undergraduate’s faculty level, not only in science and technology but also in the business management and human sciences areas.

More recently, with a direct initiative of President Al-Sisi, we launched the Egypt-Japan school system to introduce the Japanese educational system in primary and secondary education in Egypt. Last year, we began with 12 pilot schools and from this year we began with the 35 new schools.

We think that there are two characteristics which distinguish us from Egyptian and the European school systems. The first is the students’ intellectual development, as we put emphasis not only on the student’s memorising of data, but we also encourage developing students’ way of thinking and finding solutions by themselves to some questions. The second characteristic is developing the mental and physical capacity of the students.

In many countries, schools are required to develop the students intellectually, but they don’t emphasise developing the mind and body. It is usually the role of the family and community and not of the schools, as it is in Japan.

In Japan, it is important for schools and educational authorities to develop the mind and body and intelligence over Tokktsu or special activities, which encourage students to think together.

When I visited a pilot school in Cairo which introduces Tokktsu system, I saw the children myself, they were discussing a way to find a slogan for the classroom on three stages, the first was the classroom’s chairperson asking his classmates for ideas and proposals, the second was classifying the ideas in too many segments as unity and power of the class and the beauty of the class which means to keep the class good condition, while the last stage is to have a decision through voting.

It was very interesting to see the children encouraged to work together and boosting their human relations.

To have those kinds of activities in Egypt, you should have an appropriate size of the classroom, and numbers of the students have to be less than 40 for example.

Education is the foundation of the society, and we have our example so we can share it with Egypt, but it is totally on the Egyptian side to choose what you pick up and what is appropriate for implementing here.

Additionally, we pay great attention to communication and training for Egyptian teachers, and we send Japanese trainers here and we also invited some Egyptians to learn about our education system in Japan.

However, some people get cultural shocks when they see children have to clean their classes, but it is very important for us to clean the class. when I was child, I used to clean the class with my classmates together and the teacher told me “cleaning the class purifies your hearts”.

Egyptians also keep the mosques clean and when they pray, they clean their hands and body first, so we have kind of similar concept. Some might think that the Japanese are using the children as a labour force which is a misunderstanding.

Are there any new negotiations for further assistance for education?

We have already agreed on an education sector loan worth about $150m, and we will continue consultation on the items where we disburse the loan.

Apart from business, what are the cultural programme plans?

This year we are celebrating the 30th anniversary of the Cairo Opera House which was established with Japanese assistance in 1988, so from 4 to 7 December, we will be having the Opera Aida performance in participation with a Japanese soprano singer, playing the title role.

Next June a top-level violinist will come play with the Cairo Symphony Orchestra, and we will also be showing some important documentary movies.

The post High-level Japanese business mission to visit Egypt early 2019 appeared first on Daily News Egypt.

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