The Minister of Planning and Economic Development participates in the fourth session of the “Egyptian Economy Day” conference, organized by EFG Hermes
23 November 2021
The government has invested in infrastructure to create a climate for the private sector: Says Hala El-Said
Dr. Hala El-Said, Minister of Planning and Economic Development, participated recently in the fourth annual Egyptian Economy Day Summit of EFG Hermes Holding, in the presence of Mr. Karim Awad, CEO of EFG Hermes Holding, and Ayman Soliman, CEO of The Sovereign Fund of Egypt (TSFE), and with the participation of some major investors and regional and international experts.During her speech, El-Said discussed Egypt's vision about foreign investment, and the current economic situation, explaining that Egypt has steadfastly faced the Covid-19 crisis thanks to the reforms implemented since 2016.El-Said added that Egypt managed to be one of the few countries in the world capable of achieving 3.3% growth in 2021. El-Said said that despite the economic repercussions of the Corona epidemic, economic growth is expected to rebound strongly to 5.6% in the 2021/2022 fiscal year.El-Said stressed the importance of political stability as a condition that precedes investment, explaining that ending the state of emergency in all of Egypt is a reflection of the country's stability and its attractiveness to international investment. El-Said pointed out that the investment climate in Egypt is improving, noting that Egypt managed to rise in the Doing Business Index for the year 2020 issued by the World Bank by six places, to reach 114 out of 190 countries. During the period of classification of the index, Egypt implemented four business reforms.
The aforementioned reforms are considered the second largest implemented among the countries of the Middle East and North Africa.
El-Said added that Egypt ranked second among the most attractive Arab destinations for foreign direct investment in 2020, and the largest recipient of foreign direct investment in Africa in 2020, where inflows into the country accounted for 15% of the total $39.8 billion coming to the continent.El-Said added that Egypt received $5.9 billion in foreign direct investment in 2020, representing 14.5% of the $40.5 billion invested in the region that year, according to an investment climate report issued by the Arab Investment and Export Credit Guarantee Corporation.El-Said said that Egypt came in second place, receiving 19.9 billion dollars in foreign direct investments throughout the year.“Egypt has been the leading destination for foreign direct investment in the region for five consecutive years, with investments amounting to nearly $124.5 billion between January 2015 and December 2019,” El-Said explained.On Egypt's efforts towards creating a more favorable business environment, El-Said said that the Egyptian government has invested in infrastructure in recent years, noting that government participation was necessary at that time to stimulate growth and pave the way for private sector participation.El-Said affirmed the government's keenness in the coming period to pave the way for the private sector to take the initiative in investing and promoting economic growth. El-Said explained that to improve the business environment and encourage private sector participation, the Egyptian government has adopted several policies and reforms.El-Said added that the government is working to intensify the infrastructure modernization program to stimulate private sector activity, explaining that public investments directed to the infrastructure sector during the past seven years amounted to EGP 1.7 trillion. El-Said added that as a result of the huge investments in infrastructure development, Egypt's global competitiveness has improved significantly, as Egypt was able to improve its position in the infrastructure quality index by 48 degrees, raising Egypt's global ranking to 52 in 2019, compared to the 100 positions it occupied in 2014/2015.El-Said also referred to the Egyptian initiative to reform the business climate "Irada", which represents a government initiative that was launched to build a better legislative framework that supports the business climate.
El-Said said that the initiative reflects the government's interest and commitment to reforming the business climate, encouraging investment, and supporting decision-makers to develop better regulatory and legislative frameworks and mechanisms for their review and implementation, which contributes to ensuring the quality of legislation in a way that enhances transparency and achieves a balance between the interests of all the different parties.Regarding the establishment of partnerships between the public and private sectors, El-Said referred to the establishment of The Sovereign Fund of Egypt(TSFE), explaining that it is a means to accelerate the partnership between the public and private sectors, in addition to being a direct investor in the main strategic sectors, and does not aim to exclude the private sector.On the offering program for government companies, El-Said explained that the program was established to list some state-owned companies on the Egyptian Stock Exchange to stimulate the capital markets in Egypt by offering stakes in government-owned companies to citizens, local and international investors, and diversifying the ownership base. El-Said emphasized that the program’s objectives aim to attract local and foreign investments to the capital markets in Egypt, thus increasing the participation of the private sector in the economic development of Egypt, and increasing the depth and breadth of the Egyptian Stock Exchange through the inclusion of new companies and increasing the free trading of already-listed companies.El-Said talked about the national structural reform program and its main pillar is to expand the relative weight of three sectors: industry, agriculture, communications, and information technology, by strengthening the business environment and enhancing the role of the private sector, as well as improving the efficiency of the labor market and the education and technical training system and professional.El-Said concluded, noting Egypt's aspiration to increase the volume of foreign investments in the most attractive sectors, and the government's keenness to create a favorable environment for investment that encourages the business community to expand investment and production activities, thus maximizing exports and enhancing competitiveness in global markets.El-Said also stressed that the government is striving to take a more comprehensive approach regarding the investment climate in Egypt, given that Egypt has one of the fastest-growing markets in the world and is the largest market in the Middle East and North Africa region, explaining that Egypt is seen as a major gateway to the African and European markets.