Investors and experts have criticized a recent announcement by Prime Minister Kamal al-Ganzouri that the government is seeking to attract foreign investment from new markets, raising concerns about the timing of the move.
Al-Ahram newspaper reported on 12 December that Ganzouri began discussions with economic ministers to attract foreign investments and increase incentives for investors.
Abul Ela Abul Naga, secretary general for the Egyptian Investors Union, said the foreign investment dossier should be set aside for the moment, particularly since the restoration of security is still a basic demand for local investors.
He added that it is not possible to create new incentives to attract investors, especially since there is a package of incentives already in place that still require official activation. In any case, in the absence of security, the incentives will not help much, he said.
He also said that the stock market lost LE2.3 billion last week, a situation that is likely to get worse in light of current security conditions.
He called for a focus on exports and Egyptian products in the coming period. Rather than looking to attract investments, the government should focus on increasing exports, he said, which will in turn bring in new investments.
Gamal Bayoumy, secretary general for the Arab Investors Union, said restoring security is a prerequisite for attracting investments, particularly since existing investments need to be protected.
Bayoumy added that the countries of northern Europe should be prioritised at the moment because they possess venture capital, which is invested in times of crises.
An official source from the Investment Authority, which spoke on condition of anonymity, said the total amount of investments made in Egypt from August to November 2011 did not exceed US$200 million.
Translated from Al-Masry Al-Youm
