ITSOFT TO EXPORT SOFTWARE AND INFORMATION TECHNOLOGIES TO THE U.S. Source: DailyStar Egypt, ANSAmed, January 25, 2007
ITSoft (AmCham Member) (link here), an Egyptian computer programming company, signed an agreement Monday, January, 22 with Phoenix Systems Harland Financial Solutions (link here), an American company, to provide them with software and information systems.
The event took place at the Ministry of Communication and Information Technology (MCIT) (link here) in Smart Village (link here) in the presence of the Minister of Communication and Information Technology Tarek Kamel.
According to Kamel, this event indicates the success of the Information Technology field in Egypt. Kamel stated that for a couple of years the ministry has been examining opportunities to export IT technology outside Egypt and now "two deals have been signed, one a few months ago and this one now," he added.
"Exporting Egyptian IT services is our next opportunity. It will help us transfer our services to the world market and provide job opportunities in our domestic market," Kamel said. This new alliance is estimated to provide more than 150 job opportunities, according to Khalid Faraj Al-Saeid, Managing Director and General Manager and Vice President of International Turnkey Systems (ITS) (link here), the mother company of ITSoft. ITSoft was established in Egypt in 1996 and employs about 400 specialists in Computer and IT technology.
ISRAELI COMPONENT DOWN TO 10.7% IN QIZ Source: Noozz, January 16, 2007
The Qualifying Industrial Zones (QIZ) Unit (link here) at the Ministry of Trade and Industry (link here) has set off a number of measures to cut down the Israeli component requirement by one percentage point to 10.7%.
Minister of Trade and Industry, Rachid Mohamed Rachid, said in a statement on Monday, January 15, that the QIZ Unit would coordinate its efforts with the agreement’s tripartite committee, which include representatives from the US, Israel and Egypt, to curb the Israeli component requirement.
Israel’s Prime Minister, Ehud Olmert, during his latest visit to Egypt had agreed to reduce the component requirement in the QIZ agreement.
President Hosni Mubarak had also announced on Friday, January 19, that the Prime Minister accepted the Egyptian proposal to cut down the Israeli component requirement by one percentage point to 10.7% for Egyptian goods exported to the U.S. under the QIZ agreement.
Ehab Al-Messiri, a member of the board of directors of the Chamber of Textiles Industries in Egypt, urged for continued pressures to curb the component requirement to 8% in line with the qualified industrial zones in Jordan.
FDI HIT $6.1 BILLION Source: ANSAmed, January 16, 2007
Total Foreign Direct Investments (FDI) in Egypt during the fiscal year 2005/2006 hit $6.1 billion, Minister of Investment Mahmoud Moheildin said. Up to 15% of these investments were generated from state-owned assets and the private sector, 55% from new projects and expansions in projects and 30% from the oil sector.
Addressing the Economic Affairs Committee at the People’s Assembly, Moheildin said the map of Foreign Direct Investments (FDI) has changed. The oil sector which had previously attracted 80% of FDI now contributes with only 30%. The minister pledged to remove all impediments standing in the way of foreign investments and to amend the investment law to facilitate the establishment of more investment projects in the country.
According to the results of a survey of global FDI flows by the United Nations Conference on Trade and Development (UNCTAD) (link here), both Egypt and Morocco are among the top recipients of foreign investment in Africa.
115 BILLION EURO INVESTMENTS DURING 2007- 2012 Source: ANSAmed, January 16, 2007
Egypt's Minister of State for Economic Development Osman Mohamed Osman said that the investments envisaged by the 2007-2012 five-year plan will be around 115 billion euro with a contribution from the private sector of 60% against 40% for the state.
The annual average investment flow is expected to amount to some 3.2 billion euro, Osman told a conference in Cairo themed 'Management of Development between Planning and Market Mechanisms'. The minister stressed that the five-year plan was aiming at an average GDP growth of 8%. The growth target for the first year is set at 7.2% and is expected to reach 9.1% in 2012.
THE NETHERLANDS AIDS IN EGYPTIAN WATER RESOURCES DEVELOPMENT Source: Al-Alam Al Youm, ANSAmed, January 23, 2007
The Dutch government has donated 4.2 million euro to Egypt for the carrying out of the second stage of a national plan for water resources which will last until 2017 and will cost 19.52 billion euro.
Egypt's Irrigation Minister, Mahmoud Abu Zeid, said an irrigation project has been approved for 1,100 hectares in the western part of the Nile delta with the contribution of the private sector. The area was damaged after the exhaustion of underground water resources and the worsening of water quality. Under the same project the villages in the area will be provided with a sewer system. Only 4% of Egyptian villages have a sewer system.
EGYPT EYES 7.5% GROWTH Source: AMEinfo, Reuters, January 27, 2007
Egypt's economy should grow by around 7.5% in 2006/07, up from 6.8% last year, according to Prime Minister Ahmed Nazif. Nazif said economic growth would take precedence over curbing rising inflation and distanced itself from possible interest rate hikes. Prices rose by more than 12% last year, the highest level for two years.
ETISALAT TO LAUNCH IN EGYPT BY END-FEBRUARY Source: Telecompaper.com, AMEinfo, Zawya, Agencies, January 18, 2007
Etisalat (AmCham Member) (link here) plans to launch as the third mobile operator in Egypt by the end of February. The Egyptian Ministry of Communications and Information Technology (MCIT) (link here) announced that the company will operate under the 011 prefix, offering 2G and 3G services in a number of major cities to both prepaid and postpaid users by the end of next month.
The 3G services were recently launched in a ceremony with government ministers making video calls. The third network is expected to achieve 10 million subscribers within the first three years of operation. UAE-based Etisalat won the auction for the third license in July, paying LE 16.7 billion. It will compete against Vodafone Egypt (AmCham Member) (link here) and Mobinil (AmCham Member) (link here.
In a deal reported to be worth $586 million, Vodafone Egypt (AmCham Member) (link here) has received a 15-year license from Egypt’s National Telecom Regulatory Authority (link here to provide 3G services to Egyptian consumers.
Vodafone follows UAE-headquartered Etisalat (AmCham Member) (link here) into the 3G arena. Last year, Etisalat paid a staggering $2.93 billion to become Egypt’s third cellular player. The license award included a 3G concession, and at the time NTRA stipulated that further concessions would be made available at 20% of the full fee charged to Etisalat. Vodafone will also be required to give 2.4% of its 3G revenues to the Egyptian government. It was announced that Vodafone could start offering 3G services after Etisalat starts its operations in Egypt, which are expected to begin by the end of February 2007.
UK WELCOMES DELEGATION OF EGYPT'S LEADING IT COMPANIES Source: NewsBlaze, January 24, 2007
A delegation of leading Egyptian companies in the field of communication information technology (CIT) traveled to Cambridge, United Kingdom for a two-day conference with British counterparts, with the intent of making business alliances to establish links between the two countries.
The Egyptian-British Chamber of Commerce (link here) together with the Cambridgeshire Chamber of Commerce (link here) has invited the Cambridge IT community to participate. More than twenty UK-based CIT companies were ultimately short listed to meet with 12 companies from Egypt, a key access point to the Middle East and Africa.
One-on-one meetings were held between Egyptian delegates and their British counterparts January 24 and 25 2007, at Churchill College, Cambridge University (link here). The Egyptian IT group consists of 12 Egypt-based affiliates operating in Egypt, the Middle East and Africa, representing over 3800 IT professional staff and approximately LE 667 million in turnover. Leading the Egyptian private-sector delegation was Dr. Mohamed Reda, Chief Executive Officer of Allied Soft (link here).
ORASCOM SAYS ALL OPTIONS OPEN ON HUTCH ESSAR Source: Reuters, MarketWatch, January 24, 2007
Egypt's Orascom Telecom (link here), the Middle East's largest mobile operator by subscribers, said on Thursday, January 25 that it had not ruled out joining the bidding race for Indian mobile phone group Hutchison Essar (link here).
Chief Financial Officer Aldo Mareuse said, however, that if Orascom was to join the bid battle, it would probably look to buy Hutch Essar's parent company, Hutchison Telecommunications International (HTIL) (link here), in which Orascom owns a 19% stake.
Britain's Vodafone Group PLC (link here) and Indian groups Reliance Communications (link here), Essar (link here) and Hinduja (link here) have all expressed an interest in buying Hutch Essar, which is majority owned by HTIL.
JAPAN GRANTS USD 1.87 MLN TO UPPER EGYPT PROJECT Source: ANSAmed, January 24, 2007
The Japanese government will boost the UNICEF (link here) health project in Upper Egypt by allocating $1.87 million under a memorandum of understanding signed by Japanese Ambassador to Egypt, Kunihiko Makita, and UNICEF office representative here, Erma Manoncourt.
A total of four million children aged five and under are expected to benefit from UNICEF's maternal and child health program, which envisages the creation and equipping of four prenatal and neonatal centers in Qena, Sohag, Assiut and Minya. The ambassador said despite indications there had been a progress in the health sector in Egypt, however Upper Egypt is still in need of more special attention. Makita pointed out that the grant followed previous collaboration between his government, Minister of Health and UNICEF in the immunization campaign which led to Egypt's being declared polio-free in February 2006. Manoncourt said that the Japanese government's contribution would be a significant boost to Egypt's efforts to achieve two of the United Nations' Millennium Development Goals (link here), reducing child mortality by two-thirds and maternal mortality by three-quarters, by the target date of 2015.
PRIZE PETRO EYES DEVON’S EGYPT UNIT Source: dnaindia.com, January 16, 2007
Hindustan Petroleum Corporation Ltd’s (HPCL) (link here) joint venture company, Prize Petroleum, will be putting in a bid for the acquisition of the United States-based Devon Corporation’s (link here) Egyptian business.
The company is operating four oil-producing blocks in Egypt. Half of the production from these blocks is owned by the American company and the remaining by Egyptian General Petroleum Corporation.
The blocks are relatively small, with a total production of about 7,000-7,500 barrels a day (bpd), of which Devon’s share is about 4,800 bpd.
Devon Energy Corporation had on November 14 announced that it intends to divest its oil and gas assets and terminate its operations in Egypt mainly because it wanted to focus elsewhere.
NEW OIL DISCOVERIES IN EGYPT Source: Arabicnews.com, Agencies, January 20, 2007
Egypt's Minister of Petroleum Sameh Fahmi announced the discovery of six oil and gas finds in the Gulf of Suez, the eastern and western deserts and the Mediterranean.
The petroleum find from those areas is expected to secure an additional 140 million barrels of crude oil and condensates in addition to 1.5 trillion cubic feet of natural gas. The new discoveries will be assessed and tested in preparation for putting them on production map. Discoveries in the western desert are the most important, particularly in the areas of Karam 1 and Karam 2. Fahmi said Egypt has signed a number of agreements with international oil companies with advanced technologies and expertise to carry out drilling works, something which reflects the feasibility of investment in the oil sector. Those companies have achieved great success till now, Fahmi said, noting that the future promises more positive outcome.
EGYPT & JORDAN MINISTERS MEET OVER GAS PIPELINE Source: Al-Ahram, Agencies, January 19, 2007
Egypt's Oil Minister Sameh Fahmy has met Jordanian Energy and Mineral Resources Minister Khaled Shreidah at the third phase of the Arab gas pipeline project, whose short-term objective is to export Egyptian gas to Syria and boost energy sector cooperation between the two countries.
Fahmy said that the Syrian Council of Ministers had already approved the works for realization of the project on its territory, concerning the area between the Jordanian border and the city of Homs. From that area the pipeline will head towards Turkey to join in the future the European gas pipelines. The Jordanian Minister, in turn, said that 85% of the gas imported from Egypt was used for production of energy.
EGYPT TO EXPORT GAS TO SYRIA FROM OCTOBER Source: Al Gomhuria, January 22, 2007
Egyptian natural gas will be exported to Syria next October under an agreement between the two countries. Some six million cubic meters of natural gas a day will be sent to Syria through the Arab natural gas pipeline.
In September 2004, Egypt, Jordan, Syria and Lebanon agreed to connect the Arab Gas Pipeline with Iraqi's gas grid to allow Iraqi's gas export to Europe. In March 2006, Egypt, Syria, Jordan, Turkey, Lebanon and Romania reached an agreement to build the pipelines extension through Syria to the Turkish border.
Egypt's exports of crude oil, petrochemicals and liquefied gas for the year 2006 accounted for some $10.3 billion with a 33% increase, according to a report by the Ministry of Petroleum (link here).
The report presented to Prime Minister Ahmed Nazif, said the output of crude and condensed oil and natural gas rose by 13% with 72 million tons. The paper attributed a rise to a 28% increase in gas production. The Egyptian General Petroleum Corporation (EGPC), owned by the ministry, has recorded an increase of 45%, now that a newly discovered 'el-Hamad' oil field is on line. Hamad produces a little over 13,000 bpd. About 31 million tons of raw oil has been recycled to meet the growing local consumption, the report said, noting at the same time that oil surplus had also increased.
GOVERNMENT SIGNS $102 MILLION LOAN TO FUND POWER PLANT Source: DailyStar Egypt, Al-Alam Al-Youm, ANSAmed, Kuna, Xinhua, January 23, 2007
Minister of International Cooperation, Fayza Aboul Naga, signed a $102 million (LE 580 million) loan agreement on Monday, January 22, on behalf of the Egyptian Government with the Kuwait Investment Fund (link here) to finance the construction of Al Atf Power Plant in Al Beheira Governorate.
The Ministry of Electricity (MOE) (link here began working in late 2006 to secure financing for Al Atf and Sidi Krir Power Plants, part of its 2007-12 expansion plan. The total cost of the projects is projected to reach LE 5 billion, of which MOE plans to finance largely through other loans, says Mohamed Awad, Chairman of the Egyptian Electricity Holding Company (link here).
According to an MOE statement, the stations to be built will have a combined output of 1,500 megawatts. Al Atf and Sidi Krir are part of the ministry’s plan to add 7,000 megawatts of output to national production by 2012, projected to cost LE 36 billion, according to MOE.
In December, the European Investment Bank (link here) signed an agreement with MOE for a LE 2 billion loan, in line with the European Union’s (link here) Neighborhood Policy, to help finance the construction of two power stations at Al Atf and Sidi Krir.
MEDITERRANEAN SMART CARDS COMPANY EXPANDS REACH WITH NEW DEAL Source: Agencies, January 17, 2007
Egypt’s Mediterranean Smart Cards Company (MSCC) (link here) announced that they have signed an agreement to handle smart card processing for the 11-country banking institution BSIC Group.
The Bank, formally known as Banque Sahélo-Saharienne pour l’Investissement et le Commerce (link here), is headquartered in the Libyan capital of Tripoli. It has operations in 10 other African countries, namely Benin, Burkina Faso, Chad, Eritrea, Gambia, Mali, Niger, Senegal, Sudan, and Togo.
Officials from both companies met on MSCC’s premises on December 21, 2006 to sign the contract establishing MSCC as BSIC’s smart card processing company. Signing on behalf of MSCC was Hoda Shoukry, managing director and on behalf of BSIC was Mohamed Zubair, deputy general manager.
MSCC is the first smart card processing company in Egypt and is currently exporting its high-tech skills and services to numerous markets in Central and Eastern Europe, the Middle East and Africa. The signature of the agreement with the BSIC group allowed MSCC to expand its network.
EGYPTIAN-GULF CONSORTIUM BIDS FOR BUYING ASEK MINING COMPANY Source: ANSAmed, January 26, 2007
An Egyptian-Gulf consortium has offered to buy 90% of the Asek Company for Mining's shares for 1.93 million euro. The capital of Asek company totals 2.6 million euro distributed among 1.82 shares with a per share price of 1.4 euro. The National Company for Development and Trade owns 81.4% of the company's shares.
PRIME MINISTER AMENDS SECURITIZATION RULES IN INVESTMENT INCENTIVES LAW Source: Al Ahram, January 31, 2007
The government has amended its rules on securitization to make it easier for companies to raise short-term debt, Prime Minister Ahmed Nazif announced. Under the amendments, the government has set a minimum required capital for companies engaged in securitization, without specifying what the minimum was. The amendments make securitization a non-banking financial service.
They also set conditions for the activities of securization companies. The minimum capital requirement of the securization companies can be set in any convertible currency, and the capital must be deposited at commercial banks registered at the Central Bank (link here). Financial statements must reported in the same currency as the company's capital. Securitization allows companies to discount their short-term debt, Investment Minister Mahmoud Mohieldin said. This can increase their cash flow and improve their efficiency. The amendments were made to the executive regulations for investment incentives law of 1997.
GERMAN COMPANY TO MANUFACTURE OIL & GAS PUMPS IN EGYPT Source: ANSAmed, January 19, 2007
Egypt has signed a contract with a German company to manufacture oil and gas pumps in the country. In statements on the sidelines of the signing ceremony of Ruhrpumpen-Egypt, Egyptian minister of Petroleum Sameh Fahmi said the Egyptian component will be up to 33%.
The company's Managing Director Yasser El-Maghrabi said 20 million euro are invested in the factory. The pumps' factory will help rationalize hard currency expenditure in import, said Fahmi, adding it will also open new career opportunities.
EGYPT LAUNCHES MAJOR GOLD MINING DRIVE Source: Yahoo!News, menareport.com, Gulf News Daily, Beltone News, January 24, 2007
The International Finance Corporation (IFC) (link here) signed an agreement with Egypt’s Petroleum Ministry (link here) to provide technical assistance to the country’s mining industry. The memorandum of understanding aims at restructuring the gold mining sector, which officials predicted could bring in more than $10 billion and reshape the country's economy.
The MoU was signed by Oil Minister Sameh Fahmy and the International Finance Corporation (IFC) (link here), the private arm of the World Bank Group (AmCham Member) (link here), to replace old mining laws which had made foreign investment virtually impossible.
"This is a very important step in restructuring the sector, which has huge potential... and the current legislation could not sustain the restructuring efforts," said Fahmy.
Managed by IFC’s technical assistance facility in the Middle East and North Africa, PEP-MENA, the joint project will undertake a review and reform Egypt’s mining laws, regulations, and taxation. Egypt’s government wants to liberalize the country’s mining industry to attract more domestic and foreign investment. The existing policy framework requires further improvements for Egypt to be able to compete internationally. The new policy framework is expected to be completed within a year. Once enforced, observers and officials expect to attract foreign companies to exploit Egypt's huge gold reserves. Two Australian companies already operate in Egypt's eastern desert. The largest, Centamin (link here), claims proven resources of more than 7.7 million ounces of gold, and further drilling is expected to further boost these figures. Egypt's antiquated mining laws, based on profit-sharing, were prohibitive for foreign mining majors wishing to exploit the country's huge reserves, and local expertise is currently insufficient to develop a home-grown industry.
$89.5 MILLION KFAED LOAN APPROVED FOR EGYPT POULTRY INDUSTRY Source: Kuna, January 23, 2007
The Kuwait Fund for Arab Economic Development (KFAED) signed an agreement which initialed a $89.5 million loan to support development and restoration of Egypt poultry industry.
The agreement was signed by KFAED's Director General Abdulwahab Al-Bader and Egypt's Social and Development Director General Hani Al-Nasser. Al-Nasser announced that this agreement represents KFAED's cooperation and positive support in development and execution of projects in several areas of the Egyptian community. The project will provide all the necessary requirements in developing poultry farms, eggs production and fowl domestic food.
ITALY'S SOCOTHERM WINS 2.5 MILLION EURO PIPELINE DEAL Source: ANSAmed, January 24, 2007
Italian company Socotherm (link here), a world leader in protective coating of pipes for extraction and transport of oil and gas, has won a 2.5 million euro contract in Egypt for the weight coating of some 60 kilometers of pipes.
EMG from Cairo awarded the Engineering & Project Division of Socotherm a contract for rental and technical assistance for the 'Al Arish to Asquelon Pipeline Project'. The weight coating activities will be performed in 2007 in Port Said using Socotherm's technical supervision.
It has been announced that Socotherm shall provide the design, engineering, quality, expertise and technology associated with the plant and production of the concrete weight coating of pipe as well as for anode installation. The supply of the above mentioned will be regulated through a leasing contract valid until the end of the project.
TOURIST ARRIVALS HIT RECORD 9.1 MILLION IN 2006 Source: EFG-Hermes, January 24, 2007
Tourist arrivals to Egypt grew Y-o-Y by 5.5% in 2006 to 9.08 million tourists. The number was boosted by a 15.6% Y-o-Y growth in arrivals in the last quarter of the year. The second quarter was the weakest, with tourist arrivals growing by only 1.5% due to the Dahab attack at the end of April.
The number of tourists from the UK in 2006 jumped by 59%. Some 15% of all tourists arrived from the UK, making it the biggest source of tourists to Egypt. Russia, with 11% of total arrivals, was next, followed by Germany, with 10.6%. Italy’s share fell to 8.7% from 9.6% in 2005. Tourists spent a total $7.6 billion in 2006, up 11.9% from 2005. It is believed that the increase in spending by tourists was due in part to the growth of higher spending tourists such as Saudis, who increased by 8% from last year.
RED SEA HOTEL ROOMS ALMOST TO DOUBLE WITHIN 3 YEARS Source: Al Alam Al Youm, EFG-Hermes, January 24, 2007
Four hotels with 1,243 rooms have opened in Hurghada and Safaga, bringing the total number of hotels in the Red Sea area to 210 hotels and the number of rooms to about 45,000 rooms, or 26% of all hotel rooms in Egypt.
Some 133 hotels now under construction in the area will add another 35,000 rooms within three years. Almost 2.8 million tourists, or 31% of all tourists visiting Egypt, arrived at the Red Sea area in 2006.
MINISTRY OF TOURISM TO LAUNCH GLOBAL MARKETING CAMPAIGN Source: DailyStar Egypt, Al Alam Al Youm, January 21, 2007
The Ministry of Tourism (MOT) is now finalizing its re-planning of the North Coast ahead of launching an international marketing campaign in February to draw investment to the area, announced Minister of Tourism Zohair Garana.
Abandoned areas of the North Coast have been plagued for years by illegitimate claims of ownership which have hindered the government's development efforts. Garana said MOT has finished sorting out the claims and is prepared to offer tourism project tenders under build-own-operate terms or via direct land sales for development.
At the same time, the EU has allocated 2.4 million euro to help Egypt develop a program for tourism advertisement and marketing abroad. Ahmed El Khadem, President of the Egypt Tourist Authority (link here), said the project is based mainly on marketing, personnel training and introduction of new technology. The program will begin with the training of 25 employees of the Authority, Khadem said. Egypt has drawn a program for reaching the figure of 16 million tourists a year by 2014.
CONSTRUCTION OF NEW RED SEA TOURIST PORT BEGINS Source: Al Alam Al Youm, January 24, 2007
Egyptian Red Sea province governor Bakr El Rasheedi placed the first stone of a new tourist port for yachts in the region of Sahl Hasheesh on Tuesday, January 23. The new port will cost 2.3 billion euro. Sahl Hasheesh is a new tourist city, south of Hurghada, which covers a surface of 3,200 hectares and has a 12 kilometer coastline.
CONSTRUCTION TENDERS FOR FIRST PHASE OF THIRD METRO LINE COMPLETED Source: DailyStar Egypt, January 16, 2007
Orascom Construction Industries (OCI) (AmCham Member) (link here) announced on Monday, January 15 that it has won a total of LE 1 billion in construction projects for the first of four phases of the Greater Cairo Metro Line 3.
According to a statement released to the Cairo and Alexandria Stock Exchange (CASE) (AmCham Member) (link here, OCI's share in the LE 4.4 billion project includes executing civil, electrical, mechanical and rail works and supplying 650,000 tons of concrete.
OCI will work as part of several consortiums on each of the tenders won. In September, a consortium made up of OCI, Arab Contractors (AmCham Member) (link here) and a group of French companies led by Vinci (link here) and Bouygues Construction Group (VBCG) (link here) won the construction rights to the first phase of Cairo's third metro line with an offer of €400 (LE 2.9 billion). The first phase, stretching 4.2 km from Imbaba to Abbaseya, is expected to be completed in four years. Construction already began in October, 2006 to clear the way for a LE 900 million high-voltage power station to supply the new metro line. The line will eventually reach Cairo International Airport (link here), passing through Nasr City, with a total length of about 30 km.
The National Railway Authority (NRA) is still to release a definitive timetable for completing the project. According to National Tunnel Authority Chairman Saad Hassan Shehata, each phase will require four years of construction, but phases can be worked on simultaneously provided funding is secured.
NRA is yet to announce tenders for phase two, scheduled for simultaneous completion with phase one in 2011.
ITALCEMENTI TO BUILD 3 PLANTS WORTH $513 MILLION Source: Arab Asharq El Awasat, January 15, 2007
The consortium formed by Suez Cement (AmCham Member) and Ciments Francais (link here), a subsidiary of the Italcementi Group (link here), has started the construction of three cement plants worth $513 million in order to cope with the growing cement demand both on the domestic and the foreign market.
The new plants will be constructed in the region of Suez (134 kilometers east of Cairo), Qattamiah (10 kilometers east of Cairo) and El Menya (243 kilometers south of Cairo). The two plants in Suez and Qattamiah will produce 1.7 million tons of cement per year at a cost of $210 million. The plant in El Menya will cost $93 million and will produce 330,000 tons of cement per year. The three projects will be completed by 2009 and will allow a rise in production of 30% compared to the current one. Italcementi, which entered the Egyptian market in 2001, currently has investments of the order of $900 million and operates in five plants in Suez, Qattamiah, Turah, Helwan, and El Menya.
AVERAGE CEMENT PRICES FALL WHILE PRICES RISE IN SOUTH SINAI AND NEW VALLEY Source: Al Alam Al Youm, EFG-Hermes, Janaury 22, 2007
According to a report by the Ministry of Trade and Industry (link here, in the week from January 4 to January 10, the average retail price for a ton of cement has dropped LE 15 from two weeks earlier to LE330.
The average price in some governorates, however, including South Sinai and the New Valley, rose to LE 360 due to high transportation costs and because the main cement producers in those regions, Assiut Cement and Lafarge, increased their delivery prices. Most other cement makers have kept their delivery prices steady. Ameriyah Cement, however, raised its price to LE305 from LE302.5. Production in that same week has also dropped 45,900 tons to 761,400. Total supply, including inventory, rose to 1.44 million tons from 1.39 million two weeks earlier, the report said. In addition, local sales decreased by 68,700 tons to 567,977, and exports also dropped by 44,000 tons to 37,551.
ORASCOM INVESTS IN BUDGET HOUSING Source: ANSAmed, January 15, 2007
Egypt's Orascom Hotels and Development (link here) said on Sunday, January 14 that it would invest around LE 2.8 billion ($491 million) in budget housing projects associated with the government.
The firm said it had set up a new budget housing company to develop 50,000 units on 8.4 million square meters of land in areas including Sixth of October City near Cairo, Fayoum and the Red Sea. Abdel-Wahab said the new company, called Orascom for Budget Housing, established two months ago, will begin work on the projects this quarter. "Orascom will establish about 500,000 housing units over the next six to seven years, as part of the National Budget Housing Project," he added. The project will include hospitals, shopping malls, beside the housing units. The unit is about 64 meters, costing about 70,000 Egyptian pounds. The new budget firm's authorized capital of LE 600 million would be raised by selling units off-plan through Orascom Hotel and Development's mortgage finance company, Tamweel, established in September 2006.
CHINESE COMPANIES INVESTIGATE OPPORTUNITIES IN RED SEA PORTS Source: Noozz, January 21, 2007
A Chinese delegation from maritime transport companies was visiting Cairo by mid-January to explore investment opportunities in the Egyptian marine transport sector, with a specific target to operate passenger ferries between Red Sea ports in Egypt and Saudi Arabia.
The Egyptian Minister of Transport, Mohammad Mansour, said international marine transport companies can find great opportunities for investment in Egypt. The Chinese delegates have toured around several Egyptian Red Sea ports, such as Hurghada, Safaga, Suez and Al Sokhna ports, to explore business opportunities. Chairman of the Red Sea Ports Authority (link here) Hisham Sersawi said the Ministry of Transport was doing its best to launch new passenger ferries that meet the international marine transport safety criteria.
GOVERNMENT ALLOCATES 163 MILLION EURO FOR ROADS & BRIDGES Source: ANSAmed, January 26, 2007
The Egyptian Ministry of Transport has allocated some 163 million euro to construct new roads and bridges by 2007. The General Authority for Roads and Bridges has earmarked 79 million euro of the government funds to construct 735kms of roads and 11 bridges that would cost about 89 million euro in total. Land transport accounts for 95% of total transportation of goods in Egypt and 60% of passenger movement compared with river and railway transport.
EGYPT ANGLES FOR STRONGER ECONOMIC TIES WITH TOKOYO Source: ANSAmed, January 17, 2007
Egyptian Minister of Investment Mahmoud Mohielddin declared on Wednesday, January 17 that Egypt is keen to strengthen economic ties with Japan. During a meeting with a Japanese delegation from the Japan Friendship Exchange Council, the minister said that the trend to bolster trade relations between the two countries was part of Egypt's keenness on achieving economic openness to the world.
The head of Japanese delegation expressed Japan's keenness on developing economic relations with Egypt, pointing out that his country was seeking to become acquainted with the perks offered to foreign investors in Egypt. The head of the Japanese delegation invited Mohielddin to visit Japan in the first quarter of 2007 to hold a symposium on investment opportunities in Egypt. Japanese investors are partners in 13 companies operating in Egypt with a total investment value of $454.8 million. Japanese loans to Egypt in 2005-2006 amounted to $500 million, including $41 million for combating industrial pollution and $300 million for the Egyptian Museum. Egypt is the ninth receiver of Japanese bilateral aids worldwide, and the first in the Middle East and Africa.
FURNITURE EXPORTS GROW 390% FROM 2004 Source: ANSAmed, January 19, 2007
Egyptian furniture exports have grown by 390% in the period 2004-2006, standing at $180 million in 2006 compared to a mere $46 million in 2004. The announcement was made on Thursday, January 18, by Trade and Industry Minister Rachid Mohamed Rachid, during a meeting with members of the Egyptian Council for Furniture Exports.
Rachid underlined that his ministry intended to continue economic support for the furniture industry as a sector which helps create new jobs. In this line of thought, the minister cited an example of jobs created in northern Cairo and in Damietta, on the Nile delta, which allowed the employment of young craftsmen. In conclusion, the minister said that the furniture industry is one of the most promising and competitive for Egypt on the world market. On his part, the president of the Egyptian Council for Furniture Exports, Adham Nadim, said that the sector had received $3 million in funds from the Egyptian Fund for Export Development.
GOVERNMENT PLANS TO BOOST AGRICULTURE EXPORTS TO RUSSIA & CHINA Source: Al Alam Al Youm, January 24, 2007
Egypt has prepared a plan to discover the opportunities for agriculture exports and penetrate the markets of China and Russia. Under the plan, special Russian and Chinese geographic councils, will be set up to increase agriculture exports to those markets.
The Agriculture Export Council will also sign a contract with the Italian Fair of Parma to launch jointly an international exhibition. Egyptian agriculture exports to the European Union (link here) have increased by 70% since the Association Agreement came into force in 2004, against a 20% rise of the European exports to Egypt. The Council for exports of agriculture products aims at reaching LE 6 billion Egyptian (some 810 million euro) in 2007, compared to the LE 5 billion Egyptian (674 million euro) reported for 2006.
EGYPT SIGNS FREE TRADE AGREEMENT WITH EFTA Source: EFG-Hermes, EFTA website, Al-Alam al-Yom, Al-Akhbar, Swissinfo.com, January 27, 2007
The European Free Trade Association (EFTA) (link here) member states including Iceland, Liechtenstein, Norway and Switzerland have signed a free trade agreement with Egypt on the sidelines of the World Economic Forum (WEF) (link here) in Davos on Saturday, January 27. The signing of the agreement comes after more than six years of negotiations.
According to the agreement, Egyptian exports to EFTA countries will be customs and tax-free. Representatives of Swiss investment companies in Egypt welcomed the agreement, saying it will help Swiss companies in Egypt export their products to markets of EFTA countries.
For his part, Minister of Trade and Industry, Rachid Mohamed Rachid, said he hoped the deal would open up business opportunities and cement relations between EFTA and Egypt.
EFTA's deal with Egypt is part of its efforts to participate in the Euro-Mediterranean Free Trade Area, which is being set up by the European Union as part of the Barcelona Declaration on political, economic and social relations with southern Mediterranean countries. EFTA already has agreements with several countries in the Euro-Mediterranean Free Trade Area, such as Turkey and Israel.
JORDANIAN-BASED AL TAJAMOUAT INDUSTRIAL TO SET UP AN INDUSTRIAL CITY IN CAIRO Source: Beltone News, January 25, 2007
The Jordanian-based Al Tajamouat Industrial (link here) plans to invest $300 million to set up an industrial city near Cairo on 2 million square meters of land. The company signed a letter of intent with the General Authority for Industrial Development (GAID) to set up an industrial city in the 10th of Ramadan District in the Greater Cairo governorate.
The industrial city will be a Qualifying Industrial Zone (QIZ), which has customs privileges in the export of certain products to the U.S.. Development of the QIZ will start in two months with an investment of $50 million in the first phase.
Compiled by: Business Studies & Analysis Center E-mail: Studies@amcham.org.eg If you want to receive this bulletin on a regular basis, fill out this form
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