By Mohamed Alaa Eldin
Egypt needs several decisions and reforms to improve the investment climate, according to Reem Asaad, director of investors’ relations with Raya Holding and CEO of Raya Data Centre.
This is especially with the presence of many investment opportunities in the local market, Asaad said.
She believes the market needs the unified investment law to be launched, as well as a number of legislative reforms, especially in the tax law, in order to attract more foreign investments. She added that the Egyptian market has many investment opportunities, most prominently in the information technology (IT) sector, which will play a major role in the mechanisation of the rest of the state’s sectors.
She revealed that Raya Holding is interested in a number of projects expected to be raised during the summit, especially the Smart Village, Smart Electricity meters and new and renewable energy projects. The company is studying them at the moment and is considering competition mechanisms, whether through partnerships with foreign investors or the local consortium that a number of companies are working to establish.
What are the investment incentives that you recommend for attracting foreign investment?
The investment climate in Egypt needs some steps before it’s completely ready to attract foreign investments. Some of these steps are the unified investment law and tax law, especially as many neighbouring countries are offering investment incentives to investors, which make companies owners and businessmen invest in these countries. The tax value in Egypt represents 30% of profits, while in neighbouring countries like Jordan, this percentage is reduced to attract new investors. The investment climate in Egypt needs a group of legislations and laws for business start-up and exiting markets. We also need to improve the infrastructure and political stability, which I consider the most important step towards giving investors confidence in the Egyptian market. Offering facilities in foreign currencies conversion is also very important.
Is the Egyptian market still attractive to foreign investments despite security problems?
We don’t have other alternatives. We can only attract foreign investments to push growth rates and the Egyptian government is determined to do that. The whole world has gone through the experience of facing terrorism. Egypt and the Middle East are going through it now. The Egyptian market is large with many opportunities in all sectors, especially in the IT sector. This supports the market and helps it retain its attractiveness.
How do you see the benefit of the Economic Summit in the light of security conditions in Egypt?
Egypt is currently in a state of war against terrorism, and the Economic Summit at this particular timing is considered a reassurance to investors that the Egyptian government is determined to move forward with its plan of enhancing the Egyptian economy. The summit also provides investors with new opportunities to become familiar with the situation in Egypt in a more realistic way, away from news that only focuses on explosions and other bad events.
What are the investment opportunities that can be promoted in the IT sector?
The IT sector is service-oriented, and the majority of the other sectors in the state, especially health, education and tourism, need mechanisation, which will create various investment opportunities for IT companies in the Egyptian market.
Are you planning to compete for IT projects to be raised in the Economic Summit?
There are many projects that Raya is considering, especially that the Ministry of Communication has put a list of a number of major projects like smart electricity meters and Smart Village, in addition to new and renewable energy projects. We are considering competition mechanisms for these projects, whether through the local consortium or partnerships with our foreign partners.
What are your plans for establishing data centres?
At the end of last year we opened a data centre in New Cairo, making the number of our data centres reach three, located in 6th of October City, Maadi and New Cairo. In 2015 we will work on attracting more customers to the field of data hosting. We are planning to expand geographically inside Egypt during the coming phase. This will happen through establishing a data centre in Alexandria to serve areas of Delta and Lower Egypt, as well as establishing another data centre in Assiut to serve Upper Egypt.
What does the IT sector need to attract investments?
It needs strict laws, especially in regards of data and intellectual property rights protection, as there is a plan to spread cloud computing. It also needs the improvement of internet services and the dissemination of high-speed internet through fibre cables because internet has become a necessity of life not a luxury. Internet prices in Egypt need to be reviewed. There is a need to either decrease prices or improve the quality of services, as there is no proportionality between prices and services of the internet at the moment. There is also a need to speed up the process of establishing a new infrastructure entity. It is unreasonable that Telecom Egypt (TE) is the only company controlling the IT infrastructure market. The presence of an entity competing against TE will allow improvements of services and offering lower prices, which will affect value-added companies in the IT market, like data centres and call centres.
