Author Archives: globaltradematters

Egypt is not only about the rich and the poor

Cairo – 23rd March 2013 – Many familiar faces in this room joined us in April of 2011 for a two day conference ironically enough titled “Egypt and the Challenges of Economic Reform”.

Back then, I saw a golden light of optimism on the faces of all who were present, but today I see the gloom of uncertainty engulf the room.

Where did we go wrong? and what can we do about it, are the two main themes of today and tomorrow.

For those who know me, I have been a strong advocate of private sector interests for almost a decade now.
And with over 85% of you here today representing the private sector, please allow me to make the following points.
We can no longer sit back and watch our businesses, hard work, time, effort and investments go to waste.
We can no longer be excluded from policy formulation, and participation in the decision making process.
After the revolution… the majority of us refuse to again be side lined for the best interest of a few over the many
As members of the private sector We must all understand our true weight as an integral part of the Egyptian economy, society and the communities we work in and are part of
We are the private sector, we own the factories, we own the business, we own the services
We are the driving engine of economic growth and the largest employer of both skilled and unskilled labor in the country.

The very nature of the private sector is built on efficiency, on the notion of success, on the understanding of profit and loss.
For most of us, our businesses are like little states within a state,
We too hold elections, electing our chairpersons and board members, We have well defined organizational structures, and strive to develop and sustain healthy corporate cultures, we have internal policies and procedures to abide by, we provide medical insurance and education through trainings and employee development programs,
We strive for best business practices, corporate governance and transparency, We conduct surveys, polls and focus groups and measure customer satisfaction so that we may continually improve on our services and products
We have a mission, a vision and even a philosophy and we measure efficiency, competency, and performance
We have Corporate Social Responsibility programs serving communities across the nation, working hand in hand with civil society to build our country.
That being said, we expect nothing less from the current leadership of this country.
Everyday which passes is a day we shall never regain in our efforts to build on Egypt’s Glorious Past…. for a Flushing future.
We refuse to be marginalized at a time when everyone of your ideas, thoughts, your knowledge, expertise and experiences are so desperately needed
The time has come for us to make a stance, not only for our voices and opinions to be heard, but for our recommendations to be turned into action.
I speak to the leadership when I say “change your focus from borrowing and more borrowing to making breakthroughs in our private sector, in services, manufacturing, trade and innovation.”
Put aside all differences and work with us to save Egypt from economic collapse.

Provide us with the right environment and we will build more factories, businesses, ports, urban communities, we will invest in research and technologies, education and infrastructure. We will build farms in the desert and cities in the sea. We will provide jobs for the young and dignity for the retired.
I am not speaking of the impossible,
Actually you will hear many “possible things” here today and tomorrow, but it is up to us, what we will do with them to help revive Egypt’s economy, our business and guarantee a better future for our families.

The Rebirth of Our National Identity

Cairo – October 8th 2013: In less than 3 years, Egypt has undergone more changes than it has over the past 30 years, and while such changes included conflicts, they also included resolution which have led to the rebirth of Egypt’s national identity. After decades of stagnation in nationalist sentiment, Egyptians today have found a new sense of belonging, and control over their futures. Tens of millions took to the street on June 30th 2013, in a quest to save their national identity, everything which makes Egypt unique, everything which makes us Egyptians.

Today, it is imperative that we enforce the rebirth of our National Identity and share with global markets, represented by foreign investors and international consumers, our vision and strong belief in Egypt’s economic and political future. Our nation’s image as perceived by global consumers will play a major role in encouraging trade, tourism and attracting foreign direct investments. Yet to achieve this we must first identify the right strategies and tools required to implement a cohesive and comprehensive “National Image Plan”.

The Lost Guardians of Democracy

Cairo October 1st 2013: In comparison to the past year of darkness which we collectively endured under a fascist regime which showed no interest in Egypt’s best interest or that of its people, today I have never felt more alive, invigorated, optimistic, and more proud to be an Egyptian.
While the world around us is coming to terms with the reality of what is taking place in Egypt, there are still those few who in their arrogance and ignorance are still insisting on twisting the truth.
If would allow me to share with you a thought – A phone call actually I received from a friend of mine on the 4th of July 2013.
JULY 4, 1776

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

July 3rd 2013
When our government became destructive, the people of Egypt exercised their rights to abolish such a government and have instituted a new government and today are laying its foundations on real Egyptian principles and organizing its power in such a form which shall seem most likely to effect our safety and happiness.
We can no longer accept the double standards of those who claim to be guardians of democracy across the globe. For more than 3000 years the pyramids have stood tall as a symbol of Egypt’s glory, yet still there are those that insist that the Pyramids where built by aliens.
Just to clarify…. Egyptians built the pyramids 3000 years ago, and it was the same Egyptians who brought down the rule of an international terrorist organization on July 3rd 2013.
So make as many false claims as you want. But the reality is today the people of Egypt are now writing their own future, a future that will not be dictated to us those whose knowledge of Egypt is derived from the discovery channel and tom and jerry Cartoons.

Egypt, the world’s greatest civilization

Cairo – September 30th 2013: Egypt, the world’s greatest civilization, the mother of the world, the land of peace, religious diversity and unity, the land of the free, the gift of the Nile, the jewel of the Mediterranean, this great nation is ever changing day after day before our very eyes through the free will of the Egyptian People.
As the world watches these changes with amazement and respect when tens of millions of Egyptians flooded the streets to make their voices heard, foreign media outlets have deliberately silenced our calls for freedom, dignity and social justice, misinterpreting and misrepresenting the current events while relaying misguided messages to the international community.
Together we can show the world that we are optimistic about the future, that Egypt will live up to its true potential both politically and economically. That true democratic change does not just happen and that we will take as much time as we see appropriate to create a sustainable stable political, social and economic environment to ensure a better future for posterity.

My approach to solving Egypt’s energy challenges (Simplified)

My approach to solving Egypt’s energy challenges might seem radical amidst the current suggested approaches, especially those which are mainly focused on Subsidy Removal.

Like any family in Egypt facing financial difficulties, we have two primary options, either cut cost (spending) or increase income. The optimal solution is to do both simultaneously. The secondary option is to borrow money, and this seems to be the main focus of the current government.

Their current approach has been placing an emphasis on building global financial credibility (credit worthiness) by convincing the International Monetary Fund that the government can curb the explosive budget deficit through a series of economic measures such as the removal of subsidies, increases in taxes, vamping up custom duties on products and commodities and a reduction on importation of some essential and many non essential goods.

This in my opinion is a very narrow minded approach to Egypt’s economic challenges especially concerning the Energy sector.

The only way that the Egyptian Government can satisfy the IMF conditions for a USD4.8 Billion loan is to revert back to the thinking of the famous free-market economist Milton Friedman, which promotes minimal government intervention and places an emphasis on free markets as a way to control the economy.

Yet does this solution really stand in the best interest of the current leadership of Egypt? The answer would simply be NO. Like the military leaders who ruled Egypt for the past 60 years, today’s current leadership also lacks the political will to make any real structural economic changes, still preferring the notion of a controlled economy; that is, an economy that would obey orders.

Economic thinkers and historians from around the world can attest to the fact that free markets undermine political centralization and political control, and according to Friedman there is an inescapable link between free markets and freedom.

A perfect example of this theory is Chile’s amazing yet arduous economic and political transformation in the mid 1970’s , which saw a nation that embraced a government controlled economy, nationalization, and price controls, transform into one of the leading free economies in Latin America and the world.

What Chile’s experience really taught us is that true economic reform and transformation comes at a very heavy price and that it is the poor who suffer the most during the transition period. So with over 50% of the 92 million Egyptians still living under the poverty line, the current leadership is facing a very difficult and critical political position/decision.

On the other hand, the current leadership has been sending all the wrong messages regarding its economic reform plan, strategy and vision. While approaching the IMF with promises of free market reform, they clearly seem to be implementing an economic dependency policy internally.

In their desperate need to achieve high domestic economic growth, they are increasing barriers and tariffs which are further restricting the flow of imports into the country, while placing restrictive regulations on the capital markets further hindering capital flows through the stock exchange.

So the real question would be how can Egypt approach reducing or eliminating fuel subsidies while avoiding or minimizing adverse effects such as supply-shock inflation and social unrest?

Unfortunately the Post revolution leadership of Egypt has wasted almost two years in trying to satisfy conditions for an IMF reform related loan which Egypt really does not need.

Instead of being focused on dictated reforms, Egypt needs to focus on GDP growth. Egypt’s GDP in 2011 was approximately USD 230 Billion, of which only USD 12 Billion were spent on fuel subsidies.  To put this number into perspective; During its worst performing year Egypt’s tourism industry brought in just under USD10 Billion in revenues. Experts in the field believe that Egypt’s tourism sector can reach its true potential of USD50 Billion if properly managed.

So why has Egypt been focusing all its efforts and resources in trying to reduce or eliminate USD 12Billion in government expenditures versus focusing on achieving full potential for the tourism industry and gain USD 40 Billion. The same would be true for many other underperforming sectors such as manufacturing, trade and services.

Fuel subsidies in Egypt without a doubt need more practical regulatory measures; management and implementation, but by no means will eliminating them solve any of Egypt’s core economic problems. Urban communities across Egypt, farmers and factory owners large and small are now more in need of fuel subsidies than ever before. The elimination or even reduction of the fuel subsidies will result as already demonstrated over the past year, a social backlash which will surely have a more adverse impact on the economy than the original USD 12 Billion used for fuel subsidies.

The way forward should be the gradual reduction of all subsidies over a period of 15-20 years at the least. The subsidy amount saved every year through the gradual reduction schedule would then be used as incentives for the development of renewable and alternative energy sources such as solar power, wind and bio fuels.

Fuel Subsidies are the backbone of Egyptian society and businesses and it is a necessity that it is “surgically” dealt with, in the meantime a focus on economic growth, production, development, research and innovation should be the prime concern of Egypt political decision makers.

A Day in Egypt

Cairo, July 15 2012 – A quick round up of the days events in Egypt. A primary School in Fayoum flooded by sewer water, Mahala Textile factory workers on strike, 200 tons of fish found dead in the Rashid branch of the Nile, 11 story building falls on another 4 houses, Kasr el Eni hospital emergency closed for the fourth day in a row for security issues, garbage piling up on every street corner of the country, US tourists kidnapped in Siana, masked armed men attack a mall in Port Said ….amidst all this the “selected” president of the Ikhwan nation is tooooooo busy passing laws to secure the Constitutional committee retains its “Islamist” majority.”

Al Katatny is Proof of the MB Deception

Cairo – 6/18/2012 – Al Katatny is one of the biggest liers Egypt has ever witnessed in over 7000 years of civilization. So because we live in an literate uneducated population a person like the fake Katatny who was briefly (thankfully) the head of parliament. He is another BS artist from the Muslim brotherhood. He resigned (supposedly) from the MB and their so called Freedom and Justice Party (the so called political arm of the unofficial terrorist group the Muslim Brotherhood) The minute the parliament was dissolved he ran back to his masters. Kissing the “Morshed’s” a** or hand…..same thing. He is now holding hands with his “sisterhood” colleague Mohamed Moursi (the farce) . So how on earth can I trust a “Morshed” hand kissing “A hole” like Moursi to be a president of great Egypt? He will never have loyalty to Egypt as his loyalty will always and forever remain with the Morshed. Moursi….you are a failure before you even try.