Turkey, Qatar economic interests looking to resolve political dispute with Egypt

Qatar and Turkey have yet to confirm participation at the upcoming Economic Summit, according to a Ministry of Investment official, who attributed recent political tensions to the delayed response.

The political disputes between the two countries should not affect their economic relations, said Muharram Helal, Chairman of the Egyptian-Qatari Business Council.

Helal believes that resolving political issues between the two countries will serve as a strong restoration of relations.

The Egyptian-Qatari Business Council chairman expects Qatari businessmen to participate in the Economic Summit, billed as one of the largest summits organised by Egypt on investment opportunities in the last period.

Qatar occupies penultimate place regarding Gulf investments in Egypt worth $2.1bn, while Saudi investments are on top at $23bn. They are followed by the UAE at $11.6bn, Kuwait at $8.7bn and Bahrain in last place $342m, according to the General Authority for Investment.

The majority of Qatari investments are concentrated in real estate and banking, where one of the most famous Qatari companies investing in Egypt is Al-Diar. Qatar National Bank, Al-Ahli, is Qatar’s banking arm in Egypt, according to Helal.

He added Qatar will lose greatly if it avoids participation in the Economic Summit and compete for investment opportunities, as profits in Egypt are rising more than in any other country.

Egyptian-Qatari countries deteriorated after the mass demonstrations against former President Mohamed Morsi, ousted on 3 July  2013 and due to the support of Qatari leaders for the Muslim Brotherhood.

“We will send an invitation to the Emir of the State of Qatar, Tamim bin Hamad, as Egypt is a big country that aims to unite all countries against the risks the region is exposed to,” said an official in the Ministry of Investment.

In mid-January, Reuters news agency reported that Sheikh Tamim bin Hamad accepted Egypt’s invitation to attend the Economic Summit in Sharm El-Sheikh.

Qatar has a large financial surplus that is invested in foreign assets in the hotels, agriculture and energy sectors and huge financial funds.

Despite the tense atmosphere over the last period, Qatar did not withdraw any of its investments, as Egypt did not pull the chain on any serious Qatari investor coming to Egypt, according to Helal.

During the last year, Egypt returned a deposit of $3bn to Qatar.

The commercial exchange between the two countries does not exceed $500m, which, according to economists, seems to be very small given the large economic savings of Qatar. The number of Egyptian workers in Qatar reaches roughly 200,000.

Regarding Turkish participation, there are no indicators of official entities being invited to participate in the Economic Summit, according to the official.

“The economic relations between Egypt and Turkey are strong. Besides, businessmen in both countries are aware of that and their business is going well despite the political dispute and what the Turkish President thinks of the 30 June revolution,” said the official, who preferred to remain anonymous.

The official also expected strong participation by Turkish businessmen at the Economic Summit, given that Turkey is well aware of its interests in Egypt. Turkey’s boycott cannot continue if it still plans to expand trade in Africa.

“We will hold a meeting for the council within this week to discuss the matter,” said Adel Lamei, Chairman of the Egyptian-Turkish Business Council.

Despite the political dispute, economic relations between Egypt and Turkey did not decrease as the trade between the two countries reached $5bn last year while Egypt’s imports from Turkey are at $3bn, added Lamei.

Turkish investments in Egypt reached $2bn, with 380 companies and 52,000 workers, while Egyptian investments in Turkey do not exceed $50m.

Turkish tourism companies represent an important factor in the economic relations between the two countries. These companies are actually marketing for Egypt in Russia being the largest exporter of Egypt’s tourism movement, according to Turkish embassy in Cairo reports. Last year, 3 million Russian tourists were in Egypt.

Brands are popular among the Egyptian consumers especially office furniture, clothing and electrical appliances. Egypt exports chemicals to Turkey and imports a significant amount of the Turkish iron annually, according to the report.

Below is the table demonstrating the foreign trade during last five years. Since the decrease in 2013 may lead to misinterpretation, it will later be detailed.