CAIRO – The short-term challenge for the Egyptian Government is to mobilize domestic and foreign investment to create 800,000 jobs. This was the energizing call from Hesham Kandil, the Prime Minister of Egypt, opening the 16th African Stock Exchanges Association conference in Cairo 2012 #ASEA2012 today (3 Dec). He also congratulated participants for braving the negative picture painted by the international media on Cairo’s largely peaceful mass demonstrations: “What you see in media is not necessarily what is happening in Cairo.” He repeated the previous speaker’s challenge, how to fuel the growth that keeps Africa rising not uprising.
Progress and plans in Egypt
Mr Kandil pointed out that Egypt is the gateway linking Africa with the Middle East, Europe and Asia. It is busy with a process of democratic change since 25 January last year. “We are making all efforts to fulfil the aspirations of the Egyptian people. In the past few days we have reached the historic point, the final draft of a Constitution written by an elected constituent assembly, under the first elected civilian president. This is a major step, with the prospect of a constitution on 15 Dec, followed by an election for a new Parliament, ending the transition period. You are witnessing history and you should be proud for being in Cairo at this time.”
He said that a democratic Egypt offers a great opportunity for investors where they can invest in a climate of transparency and accountability, those used to dealing with the old regime will soon notice the difference. He added that 2 weeks earlier, Egupt had reached a preliminary agreement with IMF on our home-grown national programme, this open the way to receive the necessary financing to fill the budget deficit that we have inherited from a previous regime. It is a certificate of confidence that this economy is in the right hand and going in the right direction.
He said Government had divided planning into 3 timetables, in the short term (2012-2014) we need to restore growth and we also plan in the mid term 2012-17 and long term 2017-2012. Our aim in the short term is to boost economic growth from 2.2% to 4.5% per annum in 2014, moving towards a sustainable growth rate of 7% by 2022. This year we intend to create local and foreign investment to create 800,000 jobs. The Egyptian Government offers an attractive business climate and offers solutions – lately we have been able to solve problems for 46 companies, bringing investment and jobs for 100,000 people.
The Government will support capital markets, small and medium enterprises SMEs and to achieve social justice for the people, this is the short–term plan to handle the structural problems of the state budget, when the deficit last year reached Le168bn. We will eradicate corruption, it will be a long road, only from this year 2012-13 we expect to save Le20bn from corruption only, we have to rationalize our expenses. We also have to rationalize subsidies to reach the poor, the current subsidy programme keeps the poor poor, we need to focus on the sectors that will help the poor by focusing on education and health services.
Egypt committed to African partners
We are also part of Africa, in Egypt we have a sincere commitment towards Africa, to cooperate with all African partners for our mutual growth and benefit. We strongly enhance our trade linkages and seek to be a major player in the African continent. I travelled east and south, north, everywhere, it is one continent that you cannot help to fall in love with, I have seen the potential and the opportunities with my own eyes. It is projected that Africa could achieve a high growth rate of 6%, African GDP is to reach $2.6trn by 2020, we have natural resources, energy, water and most importantly human capital, we have what we need to reach this. We meet to discuss how to integrate properly through supporting capital markets in Africa, work continuously on the improvement of the technological and legislative infrastructure, I also invite investors from all over the world to reconsider Africa land of opportunity. He pointed out that return on investment in Africa is very high and African companies are generally more profitable than Chinese companies.