Minister of Investment, Dr. Mahmoud Mohieldin, said, "The Ministry of Investment is supervising 46 projects worth some $16 billion in the field of integrated development in Upper Egypt, the Red Sea, the North-West Suez Gulf Economic Zone (SEZONE), integrated commercial and civil centers, railroads, airports, technological industries, tourism projects development and medical cities."
Addressing the EFG Hermes One-on-One Conference, in which the theme was "New Decade, New Opportunities", in Sharm el-Sheikh, Dr. Mohieldin stressed the importance of investing in infrastructure, education and healthcare projects for their positive pro-development reflections.
Such projects contribute to redistributing growth and income, the minister noted.
There are major projects in this regard, such as the Upper Egypt-Red Sea Road connecting Assiut, Sohag and Qena to the Red Sea provinces, particularly the Port of Safaga. This should assist in raising trade and growth rates in those provinces, according to the minister.
"Egypt's response to the global financial crisis by implementing stimulus measures of raising government spending by EGP 33 billion helped the economy achieve high growth rates of 4.7 percent in FY 2008/09 and 5.1 percent in Q2 of FY 2009/10," Dr. Mohieldin remarked.
"CIT, building and construction, and the financial services sectors grew 14.6, 11.4 and 7.6 percent respectively in FY 2008/09, reflecting the economy’s varied growth sources," the minister added.
With regard to FDI, Dr. Mohieldin stated that "Egypt's economy attracted over US $42 billion in FYs 2004/05-2008/09. The target hovers between US $8 and US $10 billion during this upcoming fiscal year."
FDI are marked by sectoral diversity. Dr. Mohieldin said over 50 percent of total FDI goes towards new projects in various sectors, and not only oil and natural gas.
"The government will submit a draft law to regulate the partnership between the public and private sectors through new legislation under which refining firms and plants will be able to work again under the free zone system and the Investment Guarantees and Incentives Law No. 8 of 1997," Minister Mohieldin continued.
The parliament will debate the bill in the presence of representatives of more than 160 global mutual funds, 120 Arab mutual funds, and about 20 major companies listed on the Egyptian and Arab stock markets.
"Inflation rates are stable, some 13 percent above the past months. However, the core inflation rate announced by the Central Bank of Egypt (CBE) is 6 percent-8 percent, which is the true indicator of inflation rates.
"The Egyptian financial sector is stable and has high liquidity. Among the Egyptian government's most important objectives is to increase funding for companies, especially SMEs, and to intensify work at the Nile Stock Exchange (Nilex) in order to encourage new enterprises to list and trade their shares and, accordingly, get the requisite funding. Nine firms are listed and two of them are expected to be put up for sale before the end of the current fiscal year," Dr. Mohieldin noted.
The Minister also referred to a plan to develop the bonds market, thus significantly contributing to financial intermediation. The first step was the issuance of Decree No. 1 of 2010 in order to simplify the issuance of corporate bonds and to establish rules governing regional financial institutions and artificial bodies' issuance of bonds on the domestic market.
"Several measures will be taken in the next phase to significantly increase trading levels in the secondary market, which would reduce the cost of borrowing," Dr. Mohieldin said.
"The Ministry of Investment continues restructuring the insurance sector so that it may play an effective role in mobilizing savings and investment. The most important reforms aim to develop the private pension funds, increase real estate financing rates, and sign agreements with several governorates to build more than 8000 housing units for low-income persons," he concluded.