By Ahmed El-Wahsh
After several meetings with different foreign investors to pump money into the Egyptian economy, Minister of Investment Ashraf Salman opened up several new investment projects, such as the second phase of the Suez Canal and various other opportunities.
Hisham Ramez, the Chairman of the Central Bank of Egypt, has taken initiatives to decrease the budget deficit, making Egypt more indulgent endeavour for foreign direct investments. In addition to such implemented monetary policies, Ramez oversees a positive and optimistic stance for the Egyptian economy as new governmental actions and fiscal policies are being adopted and gradually executed. Such policies range from the step reduction of the fuel subsidies to raising consumer taxes, along with the restructuring of the regulatory system to set the perfect environment for an upheaval in Foreign Direct Investment (FDI).
Moving on, further research proves that the market shows signs of modest, but small, movements in terms of FDI, as the per example of Coca-Cola executives who promised to inject an additional $500m worth of tangible assets (projects and factories) to help increase and maintain the production and export from Egypt to over 40 countries worldwide.
Furthermore data shows that household expenditure has risen by 1.3% between the first quarters in 2013 until the second quarter in 2014, these figures reflect interesting and prosperous signs of an increase in consumer good investment and consumer purchases in general, which will in fact encourage investors to fund the ever growing Egyptian market.
In conclusion, Egypt’s market is witnessing a fairly slow but steady incline in growth, which entails the fact that this is not just a short-lived fad, which will rapidly die out soon, and lead to a decline in the economy but rather an adaptation of nationals spending.
Ahmed El-Wahsh holds a masters degree in Banking and Finance from Queen Mary, University of London. He works as an assistant portfolio manager at QUMMIF Investment Hedge Fund