Egypt: a huge market for the right products

What does Egypt’s ‘big economy’ represent for investors? Dr Amr Hassanein, Chairman of the Middle East Rating and Investors Services (MERIS), Moody’s affiliate for Egypt and other countries in the region, discusses Egyptians’ high purchasing power, their country’s achievements in recent years, and its high profit margins.



Egypt has been experiencing structural reforms implemented by this newly elected government after years of turmoil following the Arab Spring, which have put the country back on track within a stable framework. What would you define as the most important achievements in recent years?

The main achievement is that the current administration has managed to gain popularity among the people, and to maintain that level of popularity and of confidence. Right after the Arab Spring, confidence levels in the government had gone very low. With the current administration, that confidence level has gone back up.

The second achievement is the general level of security, which has improved to a great extent. Since the Arab Spring and since the Revolution, Egypt has gone through many internal security breaches. We used to have terrorist activities every other day, and we local Egyptians used to suffer from cars, purses and money being stolen.

All of this has subsided to a great extent, almost to the point of being non-existent. People are able now to go about and do their businesses in a very normal way. Before, there were child and adult abductions, as well as businesspeople’s. All of this has stopped and people have started going back to their normal lives. Internal security has improved to a great extent.

At the economic level, I can quote a major achievement, which is the Suez Canal. There are two things I can highlight about the Suez Canal project. The first one is the ability to raise local funding, which is related to what I mentioned about the level of confidence. Had people not had confidence in the administration, they would not have been able to raise the equivalent of $8 billion in a matter of six or seven days.

This is a major achievement itself, and it has led the rating agencies to realize that there is plenty of internal funding available. The level of internal funding in Egypt was not known before. This incident came to make the world recognize that there is plenty of internal funding. And, mind you, more than 50% of that money came from outside the banking sector. The fact that internal funding is available, and that a good part of this funding is yet untapped and yet unknown, that in itself was an achievement.

Then there is the fact that there was a promise to deliver the project within the year, when really it seemed it could not have been done in such time. And yet the promise was delivered, the promise was fulfilled and the project was completed within the year. I think this is a major achievement on the economic side.