CAIRO: With the official end of the Industrial Modernization Program in two weeks, the European Union asserted its continued support for the program s implementing body, the Industrial Modernization Center (IMC), through technical cooperation.
Klaus Ebermann, the head of delegation of the European Commission in Egypt and the European Union s ambassador to Egypt, says that the EU has a keen interest in supporting initiatives such as the IMC for the mutual economic benefit of Europe and Egypt and to contribute to the stability of the region.
The ambassador adds that he believes the IMC is standing on solid ground and that the center will continue to be the EU s key partner for engaging the private sector in Egypt.
Economic cooperation between Europe and Egypt will intensify with the signing of the Action Plan under the framework of the EU s Neighborhood Policy, which is currently being negotiated and is expected to be finalized next month. Ebermann says that the plan is the closest thing to EU membership and will provide Egypt with access to a number of the union s programs for improving infrastructure on several fronts.
The idea is to have a single economic space with the same rules, or at least with rules that are compatible, says Ebermann.
The IMC was established four years ago as a collaboration between the EU, the Egyptian government and the private sector. The EU s official role, together with its funding, will terminate at the end of this month, although the center has sufficient funds to continue operations for the next 18 months.
The original plan for funding was 426 million euros, of which 250 million euros was from the European Union, 103 million euros was from the Egyptian government and 73 million euros was from the private sector, explains IMC Managing Council Member Helmy Aboulesih.
Up until now, we have spent 56 million euros in the first 40 months and 90 million euros in the past 10 months, says Abouleish. This means that we have enough to cover our budget for next year and for half of the following year. In the meantime, we will begin fundraising at the beginning of next year.
The IMC has played a substantial role in the industrial development of many Egyptian businesses, with 2,962 industrial companies benefiting from the center s programs.
This is one of the most important projects for reform relating to the industrial sector, says Minister of Trade and Industry Rachid Mohamed Rachid.
Galal Zorba, chairman of the Federation of Egyptian Industries, adds that the IMC was created in response to the need for improving the competitiveness of Egyptian industry as a result of the liberalization of trade. Such an institution is particularly relevant, according to Zorba, in light of the historic protectionism of Egyptian industry and the challenges are multifaceted, ranging from training to technology.
The IMC has also expanded its activities in rural areas. We have reached 236 companies in Upper Egypt, 143 companies in the [Suez] Canal [region] and Sinai and 758 companies in the Delta, says Abouleish.
The center monitors its progress based on the results of the companies that make use of its services.
From the 2,962 companies, we expect an increase in sales of 25 percent growth in 2005 and 35 percent growth in 2006, says Abouleish. This means that the 2,962 companies we work with have a capacity for growth that is greater than the [average] economic and industrial growth in Egypt. We aim to increase exports for the companies we deal with by LE 3 billion in 2006 and by more than LE 12 billion in the following year. We also aim to employ 15,000 workers in 2006 through the companies we deal with and 75,000 in the following year.