Egypt eyeing larger economic presence in Africa

Egypt has signed major deals and MOU's during Africa 2017 Forum
December 17, 2017
New partnerships. Egyptian Minister of International Cooperation Sahar Nasr speaks during the closing session of the Africa 2017 Forum in Sharm el-Sheikh, on December 8. (AFP)

Cairo - Egypt signed deals and memoranda of under­standing with African gov­ernments during the Africa 2017 Forum: Business for Africa, Egypt and the World to ease trade and open the door for invest­ing.

“The event gave us a good chance to give information to African busi­nessmen about investment opportu­nities available in our country,” said Egyptian Investment and Interna­tional Cooperation Minister Sahar Nasr. “It also helped African govern­ment officials attending to bring to light sectors crying for investment in their countries.”

The conference at Sharm el- Sheikh, which was sponsored by Egyptian President Abdel Fattah al- Sisi, allowed the exchange of exper­tise and the initiating of investment partnerships.

“Africa is badly in need of invest­ments and trade,” said Rashad Abdo, an economics professor at Helwan University. “These are the two things that will enable the Africans to move ahead with development and make the best use of their economic ca­pacities.”

Most of the deals signed during the conference focused on easing trade between African countries. The Af­rican Export-Import Bank (AFREX­IMBANK) and the Attijariwafa Bank signed an agreement to encourage trade between African countries and finance development projects in Africa. The Egyptian Export Devel­opment Bank and AFREXIMBANK signed an agreement to support the export of Egyptian goods to African markets.

In 2016, Egypt’s trade with Africa amounted to $5.4 billion, including $2.9 billion in Egyptian exports to African countries.

The Africa 2017 Forum took place as Egypt demonstrates growing in­terest in strengthening economic ties with the continent. Cairo is mov­ing away from strategies in which Africa was at the bottom of the list of geographic zones for promoting business.

“Egypt’s economic strategies were focused on Europe, the United States and the Arab world for many decades in the past,” said Farag Ab­del Fattah, an economics professor at Cairo University. “It has, however, realised that dropping Africa off the economic priority list was not a cor­rect decision.”

Egypt has paid dearly, on both economic and political levels, for ne­glecting ties with Africa. Its absence occurred while regional political and economic rivals, including Turkey, Iran, Qatar and Israel, gained influ­ence.

Egypt expressed concern it could lose some rights, including to a fixed share of Nile River resources, the primary source of water for its population. When Ethiopia began construction of a multibillion-dollar hydroelectric dam on the Nile in 2011, a project that will significantly reduce the water flow into Egypt, few African countries were ready to back Egypt in its opposition to the project.

“This experience has taught us that we can run at even more cata­strophic losses if we do not mend fences with the Africans,” said writer Sakina Fouad. “Egypt enjoys a lot of advantages that make its rapproche­ment with fellow African countries rewarding to all sides.”

Even with Ethiopia, the country with which Egypt is locked in what appears to be unending and unfruit­ful negotiations, Cairo wants to ex­pand economic cooperation.

During the conference, African government officials visited major Egyptian industrial projects, includ­ing ceramic and textile factories. African government officials were shown tourist projects in Sharm el- Sheikh.

Egypt has been trying to claim an influential position on the African economic stage since 2015 when it united Africa’s main economic and trading blocs, namely the Common Market for Eastern and Southern Af­rica, the Southern African Develop­ment Community and the East Afri­can Community.

The 26 members of the blocs have a combined gross domestic product of $1.2 trillion and markets that con­tain 620 million consumers.

These are the consumers Egypt has an eye on as it tries to gain ac­cess to African markets, economists said. Sisi has been trying to convince African leaders to develop a modern road network between African coun­tries to ease the movement of people and goods.

Rampant unrest, the lack of the in­frastructure and the primitive nature of economic systems in some coun­tries remain major stumbling blocks as Egypt tries to increase business on the continent, economists said.

“This is why events that bring Egyptian and African businessmen together are important,” Abdo said. “They help local businessmen test the waters before investing in Afri­can countries.”