The second session of Daily News Egypt’s annual summit titled “Leadership in Times of Crisis” dealt with how to attract investments in Egypt, and how foreign countries see investment in Egypt. The session was titled “The Role of Policymakers in Facing Current Economic and Geopolitical Challenges”.
The session included Gareth Bailey, the British ambassador in Egypt; Hong Jin Wook, the South Korean ambassador to Egypt; and Christian Burger, the European Union ambassador to Egypt. Dalia Ashmawy moderated the session.
Ashmawy spoke about Egypt’s economic opportunities and challenges, and what needs to be done to achieve the desired success of the Egyptian economy, especially since opportunities are born from the womb of crises.
Christian Berger highlighted the crises that the EU has witnessed over the past 15 years, addressing the audience on the EU’s perspective on crises.
He spoke about the several crises that Europe faced in the last few years, including the exit of the United Kingdom from the European Union in 2016, the ongoing economic crisis, the COVID-19 crisis, and the current war in Ukraine.
“I think we must be aware of most conflict move crises. Crisis preparedness is important and we need to have an early warning system. The EU gets stronger after each crisis because it becomes more resilient and more united,” he said, pointing out that building resilience is very important in times of crisis.
The EU is Egypt’s most important trade partner accounting for ca. 25% of the country’s total trade. The EU is also the leading investor in Egypt, with accumulated investment stock of ca. €38.8bn representing around 39% of the country’s total Foreign Direct Investment (FDI). This makes Egypt the biggest investment portfolio for the EU in Africa and the second largest in the Mediterranean region.
Berger explained that in Egypt to attract new investors, there is a need to show many things, noting that Egypt is already performing several reforms in the Egyptian economy, but predictability and transparency are important as well as legal certainty and the role of law.
There are some areas in which every investor is interested such as renewable energy and gas. He also mentioned that the EU is working with Egypt on climate change and water areas in addition to working to make Egypt a hub for vaccines in Africa and the Middle East
Berger highlighted the importance of Egypt to the EU, stressing that there are a number of EU companies that are interested in investing in Egypt.
“We are cooperating with Egyptian concerned bodies to define the needs regarding the education system,” he said.
The European Union recently concluded a nine-year project to improve the governance and quality of Egypt’s technical and vocational education system and to enhance graduates’ readiness to join the labour market. The third training phase of the project has started. The program includes educating kids on the installation and fixing of solar panels.
Then, Ashmawy asked South Korean ambassador Hong Jin Wook about the areas of cooperation between Egypt and Korea.
Hong Jin Wook confirmed that there are strong relations that the two countries succeeded in establishing during the last period, which resulted in a lot of joint investments, and a larger attempt to localize several Egyptian industries.
The moderator asked: Are investors threatened by the economic crisis in Egypt?
Jin Wook said: “It is not only Egypt that has been affected by the economic crisis, but even Korea is affected as well. Korea had a large percentage of the trade surplus from sectors such as semiconductors, but we currently had a large deficit due to the crisis, but trade between the two countries is increasing by more than 40% over the past year, while Egypt’s exports to Korea increased by more than 106%, and the Ministry of Foreign Affairs supports us with our efforts.
He continued that local manufacturing and transfer of technology from Korea to the Egyptian economy are at the top of the priorities of cooperation between the two countries, as huge projects were signed in this regard during 2022, with the aim of attracting foreign investments, as Korea made its full effort to meet the Egyptian needs in this regard.
Jin Wook pointed out that the cooperation extends to the localization of the train industry, as a huge project was signed with an Egyptian partner to produce Egyptian-made metro vehicles, as well as participating in building the first atomic power station in Dabaa, noting that Egypt is self-growing, and there is more international development cooperation between the two countries in the next stage.
He pointed out that there were many successful investors, such as Samsung and LG, who produced Egyptian products and provided for local needs, in addition to their role in exporting to the countries of the region, explaining that they face some challenges and problems at times.
Jin Wook said: “We see that these companies are increasing their investments, diversifying their products, and introducing new products, and there are many investment plans in new sectors that will surprise everyone, but I cannot reveal them at the moment.”
He pointed out that some Korean investors have concerns about additional liberalization of the local currency against the US dollar, or rapid changes, noting that they see a huge potential in moving forward with investment in Egypt.
He stressed their positive vision of the Egyptian economy, and that the rapid challenges are not mentioned in front of the strength of the Egyptian economy, indicating that Egypt and Korea learn from each other, and provide each other with a hand of help and assistance continuously.
Jin Wook said that there are investors in Korea who set their eyes on Egypt, and the best way is to make the existing investors more successful. If they look at the investors in the Egyptian market achieving success, it is natural for them to come to the market and test their work.”
Ashmawy also asked: How do you see the role of people in supporting cooperation between Egypt and South Korea?
He said: “It was not easy for our people to meet face to face with the Egyptians, but thanks to the Egyptians’ great hospitality, it encouraged us to search for new investment opportunities.
He pointed out that a Korean company is currently operating in Beni Suef, and is studying expansion in cooperation with a local Egyptian partner, and that the Korean International Cooperation Agency provided some technical training with the aim of creating a favourable environment for people who work in that area, to be able to learn, pointing out Noting that many Egyptian universities have a Korean department and offer Korean lessons. There are dozens of Egyptians who are employed by Korean companies based on a memorandum of understanding between Egypt and Korea, so they feel more comfortable to create investments in Egypt.
The session moderator concluded: The presence of Egyptian cadres in the market is evidence of the presence of intelligent youth and evidence of their experience. We are ready and trying to provide an environment conducive to that, and we hope to see more for the desired change, and you are the interface that we hope to present to foreign investors, and that Egypt is in the right direction to attract investments
