Hi Egyptian businesses to offer projects to global partners at summit.
Euro money conference announces economic summit in February that could help Egypt achieve goal of $10 billion in foreign direct investments by next year:
Egypt's Investment Minister Ashraf Salman speaks at the opening of the Euromoney Conference in Cairo September 16, 2014.
Egypt's private sector will present projects at an economic summit in February in the hopes of attracting international partners, said Ashraf Salman, minister of investments, at the Euromoney conference in Cairo on Tuesday.
In addition to finding international partners, Salman said the Egyptian Economic Summit also aims to demonstrate that the government has an economic vision.
Following the election of President Abdel-Fattah El-Sisi in June, Saudi Arabia, Egypt's ally, called for a donor's conference to help boost the country's economy – hit hard by three years of political turmoil.
Hany Kadry Demian, Egypt's finance minister, said in a statement earlier this week that the government plans to ask the IMF for an economic assessment ahead of the conference in hopes that it will be in Egypt's favour.
A successful summit could help Egypt achieve its targeted foreign direct investments (FDI) of $10 billion by next year.
According to Salman, Egypt will need private sector investments of LE260-LE336 billion if it is to achieve its growth target of 3.5 percent by the end of the current fiscal year.
Egypt needs at least $28 billion in private sector investments: Minister.
Minister Ashraf Salman.
Private investments to drive growth rate to 3.5% this fiscal year as the state streamlines budget, says Investment Minister.
Egypt will need private sector investments of at least LE200 billion ($28.57 billion) if it is to achieve its growth target of 3.5 percent by the end of the current fiscal year, investment minister Ashraf Salman said on Monday.
Political turmoil had caused growth to slow to 2.3 percent of GDP in the first nine months of the past fiscal year, as the country grappled with the aftermath of a popular uprising which led to the removal of former Islamist president Mohamed Morsi by the military.
GDP is now estimated to have reached 3.5 percent in the last quarter, ending in June 2014.
Speaking at the Al Mal GTM conference on managing Egypt's balance of trade, Salman said that public investments could only make up LE58 billion ($8.3 billion) out of the LE260-LE336 billion ($37.1 - $48 billion) in investments required to achieve this year's target growth rate, meaning a greater role for the private sector.
Egypt has undertaken a series of contractionary reform measures in recent months, cutting state subsidies and reforming the tax system to widen its tax base and maximise revenue to shrink the budget deficit from 14 to 10 percent of GDP by the end of the fiscal year ending June 2015.
Earlier in July, Egypt moved to cut state fuel subsidies by LE44 billion ($6.3 billion) by raising the prices of fuels by up to 78 percent, in addition to raising electricity prices and introducing a spate of new taxes.
The resulting restrictions on government spending creates the need to liberalise the economy and resort to the private sector to reach targeted growth rates.
"Knowing that these reforms follow a contractionary fiscal policy, stimulating the economy has to be done through partnership with the private sector," says Salman.
In the longer term, Egypt's government is targeting 5.7 percent growth in fiscal year 2017/18, said Salman.
"There are three aspects to the government’s socioeconomic programme: structural reform, a stimulus development plan and infrastructure,” said Salman.
Much-anticipated legal reforms governing investments, labour, industry and bankruptcy will be accomplished by the end of the current fiscal year, while other aspects of the socioeconomic programme will take four years, according to Salman.
The government aims to reduce the poverty rate to 19.9 percent – from more than 26.3 percent in FY 2013/14 – and cut the unemployment rate to 9.5 percent – from 14.6 percent in FY 2013/14 – by June 2018, said Salman.
Following three years of political upheaval, President Abdel-Fattah El-Sisi was elected in July for four years on a promise to achieve political stability and economic development.
IMF to participate in Egypt's economic summit: Lagarde:
International Monetary Fund (IMF) Director Christine Lagarde delivers her speech on the global economy ahead of the fall meetings of the IMF and World Bank at Georgetown University in Washington October 2, 2014.
IMF's managing director calls Egypt's reforms 'encouraging', ahead of summit to attract international investors to range of projects.
The International Monetary Fund will participate in Egypt's economic summit in February, the fund's managing director Christine Lagarde told London-based daily Arabic newspaper Asharq Al-Awsat on Sunday.
Egypt's economic summit – which Saudi Arabia called for after the election of President Abdel-Fattah El-Sisi in June – is scheduled for 21 February and will encourage international companies and organisations to invest in the country and contribute to its development.
Lagarde said Egyptian authorities' "recent reform efforts" were "encouraging" and expressed her hope that participants in the upcoming summit will see how these reforms can "help restore durable economic stability and sustainable growth to Egypt."
Last month, the Egyptian government called the IMF to report on the country's economic reforms ahead of the conference, namely its recent steps to reform the state budget – which has seen major cuts in subsidies and the introduction of new taxes.
Lagarde also pointed out in the interview with Asharq Al-Awsat that the IMF has given advice to Egypt's authorities on tax policy and value-added tax (VAT) reform, which the current budget predicts will increase tax revenues by some LE14 billion.
Both the private sector and government will be presenting projects to international investors throughout the conference, with the latter presenting plans for 15 megaprojects worth $100 billion.
