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follow up ad flyers tickle market free fliers, circulars and brochures jam-packed full of advertisements and delivered door-to-door made an entrance in egypt last year – and publishers are touting them as clever methods to stimulate the economy. egypt’s economy suffers from a lack of “information flow,” according to national research center economics professor sawsan eissa. “the buyer and the seller are living on separate islands,” she said, explaining that consumers are forced to make purchase decisions without adequate information about what is available on the market. publications devoted to advertising and classified ads – which are widely distributed in north america and europe – promote sales and jumpstart economic growth, eissa added. “most probably if there are enough options and choices, the consumer will be able to assess his needs clearly and make better decisions.” while magazines and newspapers have been hit by a decline in advertising sales in the current economic slump, purely ad-driven publications have found a niche. el waseet, a classified paper providing space for commercial or personal advertisers to sell, rent or exchange goods and services, began distribution late last year. some 750,000 copies of the paper are circulated weekly to doorsteps across greater cairo. twelve issues of the circular will have been distributed as of the end of january. most advertisers are people looking to buy and sell items and services without any commercial intent. but el waseet also offers plenty of space for commercial ads. ads can be submitted by fax or phone, and el waseet agents come to collect the fees, making the process of ad placement relatively easy. the paper includes a section for real estate and another focusing on cars for sale, while computers, cameras and mobile phones are listed in the technology pages. an “electronics” section is devoted to home appliances, while personal belongings like clothing, furniture and pets fall under the “collectibles” category. ads soliciting charitable donations are in the “big heart” section. introduced in kuwait in 1992, el waseet also publishes similar papers in eight other arab states. other ad-based publications focus solely on real estate, with listings of properties and guides to prices on the market. some, like e-dar.com’s bilingual, quarterly real-estate magazine, are sold, while smaller real-estate fliers are distributed free at agencies and other drop-off points. coldwell banker middle east, a real-estate agency based in cairo, distributes 45,000 copies each month of its free bilingual flyer, your real-estate guide, featuring photos of properties and price listings. the company’s president, mohamed abdalla, said such guides serve sellers – by providing them with a forum to show their properties – and buyers – by allowing them to compare and rank various properties. “we work for the interest of both, offering the professional and quality real-estate brokerage service that has been missing in the market here,” abdalla said. abdalla regards real-estate guides as a step towards aligning egypt’s real-estate sector with international standards, through networks of active real-estate agents, standardization of broker practices and databases of available properties. aside from what’s in print, real-estate website e-dar.com offers a vast electronic database of properties on the market. advertising inserts are also making inroads into major daily newspapers. last year, al-ahram began distributing gareeda mall, a full-color glossy insert devoted to commercial advertisements. each month, 750,000 copies of gareeda mall reach al-ahram readers in cairo and alexandria. “offering a new way to advertise is attractive to clients and good for business,” said mohamed el nagaar, gareeda mall’s creator. “we offer a new service and we try to make it as attractive as possible to promote the business development of our clients.” el nagaar said the publication is appealing to consumers, too. advertisers are encouraged to be transparent by publishing prices along with photos, “to encourage people to make buying decisions,” he said. nihal jamal not seeing the city for the trees egypt’s bustling capital is hardly known for its indigenous flora. but cairo’s amateur dendrologists have no doubt noted the conspicuous new growth that has sprouted up along several of the city’s busiest thoroughfares: electric palm trees, of red, yellow, orange and green. the palms have elicited reactions ranging from admiration (“they’re a sign of progress,” said one cairene) to cynical sniggers (foreigners can’t help but make vegas references). but ultimately, like all things, the question isn’t one of taste, but of supply and demand. ossama al islambouli, director of the el-forsan company, which supplies the electric trees, explained that his customers are mainly store owners who plant them outside their businesses “in order to draw attention to their shops and to serve as landmarks. for example, [local fast-food chain] mo’men bought three or four, and the hotels on haram street have ordered a couple each.” the reactions he’s gotten from the public are generally positive. “of course there’s nothing better than real trees. but the feedback’s been very good – people like them.” al islambouli went on to say that the trees are not always bought out of commercial considerations. “one customer from mariottiya actually bought a tree for the occasion of his daughter’s engagement party,” he said. el-forsan has filled orders for the trees from all over the arab world, including the emirates, saudi arabia, oman and libya. there was even an enquiry from palestine. while a single tree costs £e 7,000, al islambouli explained that the electric palms would be much cheaper “if the egyptian customs regime didn’t charge an 86-percent tax on imported material.” currently, 70 percent of the trees’ components are manufactured locally, while 30 percent come from china. “but after two months, all components will be manufactured. adam morrow us abandons advert diplomacy the us government has suspended a campaign of television commercials it hoped would improve its image in the middle east after several arab states – including egypt – refused to broadcast the ads. on january 16, the wall street journal reported that the us state department would cancel its “shared values” tv and print ad campaign – which included four television commercials featuring the stories of successful muslim americans. the ads are part of a $15 million campaign to improve the united states’ image in the muslim world. the us administration’s war on terrorism and its preparations for a war against iraq have been met with sharp criticism in the region. despite lobbying by their respective us embassies, egypt, lebanon and jordan refused to air the ads on government-run channels, while morocco said it was undecided. the egyptian government announced in mid-december that it did not accept political ads from any foreign country, al-ahram reported. but the ads were broadcast in kuwait and indonesia, and on two arab satellite tv networks – abu dhabi tv and saudi-owned mbc, from october 28 to december 10. printed ads have been published in london-based arabic newspaper asharq al-awsat. but arab and muslim government officials questioned the accuracy – and effectiveness – of the ads. lebanon’s information minister ghazi aridi told associated press in mid-january that the ads were “contrary to the truth.” “the spots say that america is treating the arabs and muslims
well. this is not true,” he said. the us state department is now thinking about how to spend the remainder of the $15 million earmarked for the campaign. senior us envoy christopher ross, while in lebanon in december, said the us government was trying to address the lack of “an american dimension” in arabic-language programming. one possibility being considered, he said, was to launch an arabic-language satellite channel, to be called al-haqiqa (the truth). a new series of television commercials in the united states, meanwhile, could put a dent in us efforts to appease muslims. a us activist group calling itself “the detroit project” launched a campaign last month with the aim of reducing us reliance on saudi oil. the 30-second commercials link gas-guzzling sport utility vehicles with funding terrorism. saudi arabia is the united states’ second largest foreign supplier of oil, after venezuela. as asharq al-awsat reported on january 10,a major us television network, abc, is now broadcasting the ads. several hollywood stars, the article said, have aban doned their jeeps in order “not to support the saudi economy and consequently not support terrorism.” eman wahby gov’t employees to take salaries
via atm hoping to reduce the wear and tear on egypt’s overworked paper currency, the government is working with plastic card provider visa international to move egypt in the direction of a cashless society. according to recent announcements, government and public sector workers will soon collect their salaries using plastic visa salary cards for automated teller machines (atms). currently, government employees are paid in cash. under the new system, salaries will be deposited directly into an employee’s bank account. to get the cash, the employee must use an atm machine, at a bank branch or elsewhere. up to now, the atm payment system has only been used within a small, affluent segment of society. announcing the new scheme on december 14, prime minister atef ebeid and ann cook, visa international’s head for europe, the middle east and africa, said that within two years, the atm system would serve 5 million government employees. minister of foreign trade youssef boutros-ghali said the government was aiming to reduce the use of bank notes and checks by 30 to 70 percent, and increase credit card use to cover 30 percent of all payment transactions in egypt. he praised the new payment system as a step in this direction, adding that it would be applied to employees working in export-related jobs within four months. visa documents say this payment scheme – already used in other countries in the middle east and africa – “considerably simplifies payroll” by guaranteeing that employees are paid on time, eliminating the cost and security risk involved in transporting cash to government offices and reducing the administrative time devoted to salaries. cook said that reducing dependence on cash would strengthen the economy by enhancing the flow of money through banks. “the ease of money exchange is one of the most important factors contributing to economic development,” she said. only around 10 percent of egyptians currently hold bank accounts, but the figure could be expected to rise significantly if government salaries were paid via banks. atm cards could also be a first step to credit card use, as government employees may be allowed to dip into their future salaries up to one month ahead. many middle and upper-level government employees said the new scheme would help them manage their money more effectively. mohamed ibrahim, an administrative manager at the ministry of religious endowments, said the system “prevents one’s entire salary from being stolen.” mo’men fahim, a general manager at the ministry of housing, added that being able to draw on his next month’s salary could be beneficial in case of a family emergency. “for this benefit, i am willing to pay a simple interest rate,” he said. “this is better than the embarrassing alternative of having to borrow from friends.” however, abdel kader mohamed, an employee at a water utility office, said that giving workers credit was treading on dangerous waters. “no one complains about the present payment system. if workers are allowed to spend the following month’s salary, most employees will find themselves in debt,” he said. mohamed abdel tawab, who works for the ministry of labor, said there were “no benefits” in the proposed credit scheme. “my family’s demands will deplete my salary on the first 10 days of the month,” he said. but some low-level employees said they looked forward to the cards as a way to avoid bureaucratic hurdles in getting their salaries, which are often delayed due to a lack of liquidity at many public sector companies. “with this system, employees can cash their salaries on time from the bank without worrying,” public sector employee mostafa fahmy said. khaled moussa al-omrani stock market software maker almost
goes bust the canadian company that developed the software that runs the cairo & alexandria stock exchanges (case) has filed for bankruptcy and is on the verge of being bought out by an australian rival. efa software, based in calgary and owned by toronto technology developer basis100, filed a bankruptcy petition under canada’s bankruptcy & insolvency act in november, giving it time to restructure. on january 10, basis100 received an extension to february 27. but basis100 had already announced on december 16 that it would divest assets of efa to a rival in the global securities industry, australia’s computershare. the acqui immediately available for cultivation, while another 50,000 feddans are expected to become available before the end of the year. the first branch will eventually cover the 100,000 feddans belonging to saudi prince al-waleed bin talal’s kingdom agricultural development company (kadco), while the second branch, covering 120,000 feddans, is devoted solely to egyptian companies. the mubarak pumping station, the biggest pumping station in the middle east, is furnished with 21 japanese-designed pump units, two of which will be opened every month. all 21 are expected to be online by july. “increased investment in the toshka project will encourage citizens to leave the narrow [nile] valley,” the president was quoted as saying in state-run daily al-gomhouriya, adding that “there are many job opportunities in agriculture here.” the paper said that 10,000 of toshka’s workers and engineers turned out to meet the chief executive. according to the state information service, the pumping station was built at a cost of about £e 1.5 billion. with a total capacity of 25 million cubic meters daily, the station could draw water from lake nasser – even in the case of drought – for 10 years. originally scheduled to open last october, the pumping station was delayed as the government struggled to pay bills to the local and foreign contractors hired to construct it. the opening of the mega-project was, however, overshadowed by even larger developments, as the president used the station’s inauguration to make some major statements to the press vis-à-vis the possibility of impending war. “a war on iraq,” mubarak was quoted as saying in the egyptian gazette, “would have grave consequences whose extent no one can really predict. it would be like adding fuel to the fire.” at least the same events have also served to distract al wafd and other opposition newspapers, which used to be vocal critics of toshka. abdalla f. hassan us brands shunned selectively the on-again, off-again grassroots boycott of american consumer products appears to be getting a renewed push. organizers of a new arab populist movement have taken up the boycott banner as part of a campaign against the seemingly inevitable us strike on iraq. the popular egyptian committee to resist us aggression on iraq, which hosted a three-day conference in december, has made a new boycott effort one of its cornerstone issues. the “cairo declaration” which emerged from the conference specified a number of concrete steps, including a fresh wave of public protests and the dispatching of international activists to iraq to serve as human shields. the declaration also calls for a “targeted boycott” of all israeli goods and selected american products. rather than calling for a total rejection of american goods, the group has chosen a list of consumer goods, including marlboro cigarettes, nike shoes and mcdonalds fast food, as targets for a symbolic boycott. as popular committee member ashraf al bayoumi explained, the targeted boycott is basically an admission that a total boycott of us products would be impractical and doomed to failure. “the fastest way to kill a boycott’s momentum would be to try to apply it to all american products,” he said. “are people going to give their cars back? are we going to shut down the hospitals and the airports because of american technology?” boycotts have been closely tied to current events – peaking whenever public anger over israeli actions in palestine reaches a boiling point, and usually coinciding with waves of student protests. but they also have a history of fading from the public consciousness within a couple of months. bayoumi expressed the hope that by keeping the targets simple and focused, the newest boycott push will have longer staying power. ashraf khalil nib gives private sector a little
credit business leaders welcomed news that the national investment bank (nib) would begin offering credit lines to private enterprises. late last year, minister of planning osman mohamed osman announced that the bank, which had previously focused on financing state projects, would be restructured to fund private ventures. according to heads of local business associations, increasing the credit options open to private enterprises will help to accelerate development and lift the economy out of its current financial crunch. what is needed most, they said, is long-term credit, with interest rates below 5 percent and three- to five-year grace periods. “there are similar banks around the world that offer long-term loans with an interest rate that does not exceed 5 percent. this gives an invaluable boost to the national economy,” said yamani felfela, chairman of the egyptian-moroccan businessmen’s council. mostafa zaki, chairman of the importers’ association at the federation of chambers of commerce, while saying he supported the nib’s change of direction, added that nagging questions remained unanswered. specifically, he wondered if the bank would oversee state insurance capital and investment certificates, if it would get a larger injection of state funds, and if its stock would ever be traded on the bourse. zaki also expressed concern about whether state-owned companies would be required to repay the estimated £e 42 billion in debts they owe to the nib before the bank starts lending to private companies. according to an nib official, the bank hopes to diversify its sources of income through new investments, especially in costly private petroleum projects. in december, the nib board, chaired by minister of finance medhat hassanein, discussed plans to finance 14 petrochemical projects, the first two of which are expected to cost £e 2 billion. khaled moussa al-omrani oriental potentate
praises sezs mohamed farid khamis, founder and chairman of the oriental group carpet empire and chairman of the two-year-old oriental petrochemicals company (opc), spoke recently about the merits of the low-tax industrial sites set up under the law for special economic zones (sezs), passed last may. speaking on january 22 at the egyptian petrochemicals conference, organized by the middle east economic digest (meed), khamis gave a private investor's perspective on how to develop projects in the petrochemical sector. along with the availability of competitively priced natural gas, access to large external markets and strong domestic demand, he cited "the commitment of the local authorities to developing the industry" as a key factor in the viability of his petrochemical production venture. in the case of opc, the sez law was a major draw. "we set up in the suez area... to take advantage of the new economic zones established under this law," khamis explained. although opc's polypropylene plant was set up in june 2001, a year ahead of the law's passage, what clinched the deal for suez was the promise of tax incentives along with the existence of brand new port facilities nearby. clarifying the differences between the sezs and the regular free zones set up under an earlier law, khamis pointed out that a manufacturer in an sez was subject to "no limit on sales to the local market." he did not specify whether opc's goods could be moved into the egyptian market tax free. however, another advantage accruing from the use of sezs is freedom from the protective labor regulations that govern the rest of the country - at least until parliament passes the unified labor law, which is being debated in the current session (see feature, page 38). with an sez, khamis said, "it's as easy as hire and fire. it's no different from my plant in atlanta, georgia," he said. "i can say, 'good morning, john, you're fired.'" just as critically, companies locating in an sez are allowed to record their shares and capital in foreign currency, protecting them from widely anticipated egyptian pound devaluations. "we can sell in dollars," khamis said, adding that while the local market is important, opc exports more than 50 percent of its output. neil macdonald president launches pumping
station, warns of war on january 12, president hosni mubarak threw the levers activating the first two units of toshka's mubarak pumping station. as the state media reported the next day, the station duly began pumping water from lake nasser into branches one and two of the sheikh zayed canal, making 10,000 feddans of land immediately available for cultivation, while another 50,000 feddans are expected to become available before the end of the year. the first branch will eventually cover the 100,000 feddans belonging to saudi prince al-waleed bin talal's kingdom agricultural development company (kadco), while the second branch, covering 120,000 feddans, is devoted solely to egyptian companies. the mubarak pumping station, the biggest pumping station in the middle east, is furnished with 21 japanese-designed pump units, two of which will be opened every month. all 21 are expected to be online by july. "increased investment in the toshka project will encourage citizens to leave the narrow [nile] valley," the president was quoted as saying in state-run daily al-gomhouriya, adding that "there are many job opportunities in agriculture here." the paper said that 10,000 of toshka's workers and engineers turned out to meet the chief executive. according to the state information service, the pumping station was built at a cost of about £e 1.5 billion. with a total capacity of 25 million cubic meters daily, the station could draw water from lake nasser - even in the case of drought - for 10 years. originally scheduled to open last october, the pumping station was delayed as the government struggled to pay bills to the local and foreign contractors hired to construct it. the opening of the mega-project was, however, overshadowed by even larger developments, as the president used the station's inauguration to make some major statements to the press vis-à-vis the possibility of impending war. "a war on iraq," mubarak was quoted as saying in the egyptian gazette, "would have grave consequences whose extent no one can really predict. it would be like adding fuel to the fire." at least the same events have also served to distract al wafd and other opposition newspapers, which used to be vocal critics of toshka. adam morrow caffè puts new face
on airport an upscale, privately owned café/restaurant has provided one of the first visible signs of a current effort to refurbish cairo international airport and improve the first impression egypt makes on the millions of foreign visitors who arrive via the airport each year. caffè la poire - a subsidiary brand belonging to a 25-year-old cairo-based bakery chain - has brought a new, european-inspired sheen to a spacious section of the airport's terminal 1, the arrival and departure point for national carrier egyptair and several other airlines. "the airport is the facade of the country," la poire sales & marketing manager iman kamel said, adding that the authorities are eager to change its image. along with aggressive taxi drivers and predatory customs officials, airport users have until recently been forced to contend with an egyptair monopoly on food and beverage services. but according to kamel, new airport administrators - under the recently created ministry of civil aviation - appreciate the image-boost that private sector businesses can provide. "they have been helping us a great deal," she said. "their approach is different, correct." next to the spacious, wood-and-steel-finished caffè, which opened in january, there is a take-away counter bearing the traditional le poire name. "europeans and japanese love oriental products, things like baklava," kamel said, explaining that she hoped the location could become a last-chance shopping stop for tourists leaving the country. le poire is currently seeking out deals with travel agencies and tour operators to shepherd large groups of customers into the café to spend their last few egyptian pounds. "they have my customer in their hand," kamel said. like anywhere else in the country, foreign-exchange transactions present a problem. businesses opening at the airport are expected to make their sales in local currency. nevertheless, le poire sees its terminal 1 branch as the start of a potentially greater endeavour. private restaurateurs will soon be able to secure spaces in the more prestigious terminal 2. but the real prize, kamel said, would be the two cafés located beyond the check-in counters and security gates - still the exclusive turf of egyptair. there, captive customers have to pay as much as £e 8 for a cappuccino, she said. she insisted that caffè le poire will not raise its prices if it secures a departure-lounge location. neil macdonald unified banking law gives
bank heads pay raise with the management of many banks discredited by borrower insolvency and an accompanying lack of collateral, the country's decisionmakers are trying to lure distinguished egyptian bankers from reputable private banks into the public banking sector. as high profile as it is, heading a public bank doesn't always draw the most successful bankers. quite simply, private banks can offer heftier payrolls. to bring in new blood, the government decided towards the end of last year to put public sector bank heads roughly on par, salary-wise, with their counterparts at joint-venture banks, if not with those at foreign banks. it's quite a jump. while the annual salary of one managing director at a joint-venture bank in egypt has hit the £e 2 million mark, salaries at public-sector banks cannot, by law, exceed £e 120,000 per year - no more than a mid-level manager at a local investment bank. the gap is wider regionally, with the chairman of the national bank of kuwait taking home somewhere between $6 million and $8 million per year, in addition to bonuses. the issue came to the fore towards the end of 2001, when the government was looking to replace former central bank of egypt (cbe) governor ismail hassan. one leading banker, already employed at a foreign bank, turned down the post because he preferred to continue taking home more than £e 1 million annually, compared to £e 72, 000 for the prestigious post at the cbe, business daily al alam al youm reported at the end of december. since then, in a move to lure private sector bankers, prime miniser atef ebeid and current cbe governor mahmoud abul-oyoun have raised the pay for a chairman of a public bank to £e 700,000 a year, provided that the bank meets performance standards. according to sources in the sector, they also decided to increase the bonuses of board members to as much as £e 300,000 annually - rather than the current £e 135 for each board meeting they attend. according to high-ranking bank officials, the draft unified banking law, currently being discussed in the people's assembly, calls for the establishment of special funds, with capital of 3 to 5 percent of each bank's estimated yearly profits, to finance bonuses for chairmen, board members and upper management, especially in the credit, technology and investment departments. the prospect of vastly increased salaries has already attracted some renowned bankers. by the end of 2002, the bank of new york's former middle east regional manager, farouq el okdah, had been appointed as chairman of national bank of egypt, while former egyptian american bank (eab) chair and egyptian gulf bank vice chair mohamed barakat had accepted a position on the board of banque misr, later moving up to chairman. other private sector bankers who have recently moved into the public sector include bank of alexandria chairman mahmoud abdel latif and housing & development bank chairman fathy el-sibaey mansour. khaled moussa al-omrani |
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