Daily News Egypt sat with GE’s Chairman and CEO Jeffrey Immelt, who said that Egypt is one of the company’s key investment markets and believes that “there is a significant long-term gain for the country and businesses by shifting to renewable energy sources”.
“Solar is an area where GE brings strong synergies with our advanced grid technologies and our ecomagination products. We are in discussions on solar projects in the country and we will announce the details when they are finalised,” he said.
What is the size of GE’s investments in Egypt and which sectors are they focused in?
GE has been in Egypt for over forty years and that is a long period, over which we have strengthened our investments and partnerships. The strength of our operations is underlined by the number of employees we have in the country at over 400, which is set to increase as we focus on further strengthening our partnerships.
We have been actively engaged with our partners in Egypt on core growth sectors including energy, oil and gas, water, healthcare, aviation and transport. Across the Middle East and North Africa, we have a significant footprint today in all these key sectors.
Are there plans to expand GE’s investments in Egypt? If so, what are these plans in terms of size, nature, sectors and time frame? If not, why not?
Definitely, Egypt is one of our key investment markets because we are here for the long-term. We have been here for four decades and we are working with the public and private sectors to drive development initiatives. We have announced an investment commitment of US$2 billion in Africa, and we see Egypt to be one of the key markets in this. We are also looking at strengthening our presence in healthcare, transport, aviation and oil and gas.
We have made a commitment to provide power and water technology and capital to support Carbon Holdings’ development of the world’s largest naphtha cracker plant already. We are also collaborating with GASCO, the Egyptian Natural Gas Company, to operate the Pipeline Integrity Management Center of Excellence.
What are GE’s plans for expansion in the region in the next couple of years
We are the productivity partner in the region and we are growing at about 30%annually, providing complete solutions to address infrastructure deficit, particularly in power, as investing in power generation is crucial to sustain growth in the region. Africa, for example, has a 100 gigawatt deficit in electricity and it is important for countries such as Egypt to invest in infrastructure to compete and create jobs.
How do you assess laws regulating the investment environment in Egypt for foreign investors?
The Egyptian government is taking bold policy reforms to attract investments. What we need is to strengthen business confidence, and that comes with a lot of factors.
A clear commitment by the government in providing supporting infrastructure, through investments in power and other key sectors, go a long way in instilling business confidence.
What was the size of GE’s sales in Egypt in the health sector?
Healthcare is a growing sector for GE in the country, and we are not just looking at sales of our equipment but building solid partnerships. That, I believe, is important in driving efficiency. As mentioned, we have now partnered with the Egyptian Ministry of Health on the first-of-its-kind tele-radiology project in Egypt, connecting six remote hospitals to a central image repository in Cairo.
According to media reports, GE has expressed interest in building solar power plants in Egypt. Have any projects been agreed upon?
Solar is an area where GE brings strong synergies with our advanced grid technologies and our ecomagination products. We are in discussions on solar projects in the country and we will announce the details when they are finalised. I do not want to speculate on the tariff structure, but I believe that there is a significant long-term gain for the country and businesses by shifting to renewable energy sources.
What was the most recent progress made with regards to reported GE plans to assist in the construction of a power plant to generate electricity for Egypt’s new Suez Canal Development project?
We are in discussions to provide on-site power solutions and will announce the details in due course.
What is your assessment on measures taken by the government thus far in its quest to boost the economy?
As mentioned earlier, Egypt is taking strong policy reforms not only to facilitate inward investments but also to boost trade. I believe this is a great opportunity for Egypt, more so to leverage its hub status and as a gateway to Africa. The resource rich nations in Sub-Sahara and the Middle East have strong historic and cultural links with Egypt. The nation also has strong ties with emerging Asian economies such as India and China. The country can indeed serve as a strong global hub connecting these two big continents that are driving the global trade flows today.
What are you forecasts for GE’s 2015 profits?
We are forecasting EPS between $1.70 and $1.80 in 2015; this breaks down to about $1.10 – 1.20 from our Industrial businesses and $.60 from Capital.
Is dropping oil prices affecting GE’s outlook for 2015 at all, whether in its oil units or generally? If so, how?
We have lowered our guidance for oil and gas, but we are thinking about this as an opportunity. We are the kind company customers want to work with in a time like this.
People also forget that close to 50% of our revenues come from the US – a market that will benefit from lower oil prices.