University of Arizona
Egypt Orientation
Session
January 28, 2004
US Team visit to Egypt:

Mr. Bruce Nasby, SENIOR VICE PRESIDENT GLOBAL SIFE


Mrs. Marcia Helaine Klipsch, FACULTY
Mr. Richard Klipsch

STUDENTS:




Ms. Amanda Wright Zaluga
Ms. Amanda Elizabeth Davis
Mr. James Edward Tang-Mills
Mr. Juan Ciscomani Garcia
EGYPT
My homeland, my homeland, my hallowed land,
Only to you, is my due hearty love at command,
My homeland, my homeland, my hallowed land,
Only to you is my due hearty love at command,
Mother of the great ancient land,
My sacred wish and holy demand,
All should love, awe and cherish thee,
Gracious is thy Nile to humanity,
No evil hand can harm or do you wrong,
So long as your free sons are strong,
My homeland, my homeland, my hallowed land,
Only to you, is my due hearty love at command.
To listen to the National Anthem, follow the link below:
Source: http://www.sis.gov.eg/anthem/html/anthem.htm
Geography
Source: http://www.infoplease.com/atlas/africa.html
Location: Northeast corner of Africa
on the Mediterranean Sea
Geography
Location:
Northeast corner of Africa
on the Mediterranean Sea
Neighbors:
West Libya,
South the Sudan,
East the Red Sea and
Israel.
Size: One and one-half
times Texas.
Egypt is divided into two
unequal, extremely arid
regions by the northwardflowing Nile River (100 mi).
Source: http://www.infoplease.com/ipa/A0107484.html
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt :









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
Background Information

Arab Republic of Egypt

President: Hosni Mubarak (1981)

Prime Minister: Atef Ebeid (1999)

Area: 386,660 sq mi (1,001,450 sq km)

Population (2003 est.): 74,718,797 (growth rate: 1.9%); birth rate:
24.4/1000; infant mortality rate: 35.3/1000; density per sq mi: 193

Capital (2003 est.):
Cairo, 15,892,400 (metro.area), 7,937,700 (city proper)

Other large cities: Alexandria, 3,891,000; Giza, 2,597,600 (part of Cairo
metro. area); Shubra el Khema, 1,018,000 (part of Cairo metro. area); El
Mahalla el Kubra, 462,300
Source: http://www.infoplease.com/ipa/A0107484.html
Background Information

Monetary unit: Egyptian pound

Language: Arabic

Ethnicity/race: Eastern Hamitic stock (Egyptians, Bedouins, and Berbers)
99%, Greek, Nubian, Armenian, other European (primarily Italian and
French) 1%

Religions: Islam 94%, Christian (mostly Coptic) 6%

Literacy rate: 51.4% (1995 est.)
For more information, click on the links below:
Land , People , Economy , Government , History .
Source: http://www.infoplease.com/ipa/A0107484.html
Background Information

Stay tuned:
 http://weekly.ahram.org.eg/ : Government newspaper
 http://www.egyptdaily.com/ : Daily information and local weather
forecast
 http://usembassy.egnet.net/ : American Embassy in Egypt, Arabic
news summary
 http://www.egypttoday.com/: The magazine of Egypt (wonders of
Egypt)

Get more information:

Egypt State Information Service: http://www.sis.gov.eg
 Get to know the country and its culture with audio and video
files to download,
 Get the TV news live,
 SIS search Engine.
Background Information

Get more information:

Middle East Network Information Center, University of Texas:
http://menic.utexas.edu/menic/Countries_and_Regions/Egypt/
Arts and Humanities , Economy, Education, Egyptology, Government,
Health and Medicine, Maps, News and Media, Science and Technology,
Social Science, Society and Culture.

The Library of Congress: Egypt, a country study:
http://lcweb2.loc.gov/frd/cs/egtoc.html
The Historical Setting, the Society and its Environment, the
Economy, Government and Politics, National Security (warning:
research completed in 1990, some information need to be updated).

The CIA, the World Fact Book:
http://www.cia.gov/cia/publications/factbook/geos/eg.html
Introduction, Geography, People, Government, Economy, Communicatio
ns, Transportation, Military, Transnational Issues.
Background Information

Get more information:

Egypt Search Engine:
General information, Art, Education, etc.

Mazika:
http://www.mazika.com
Get to know the local music.
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt :









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
Government and Politics

Country name:
 Conventional long form: Arab Republic of Egypt
 Conventional short form: Egypt

Government type: Republic

Administrative divisions:
 26 governorates

Independence: Egyptian nationalism forced Britain to declare Egypt an
independent sovereign state on Feb. 28, 1922, although the British reserved rights
for the protection of the Suez Canal and the defense of Egypt.

Constitution: 11 September 1971

Legal system: Based on English common law, Islamic law, and Napoleonic
codes; judicial review by Supreme Court and Council of State (oversees validity of
administrative decisions); accepts compulsory ICJ jurisdiction, with reservations.

Suffrage: 18 years of age; universal and compulsory
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Government and Politics

Executive branch:

Chief of state: President Mohammed Hosni MUBARAK (since 14
October 1981)

Head of government: Prime Minister Atef Mohammed ABEID (since
5 October 1999)

Cabinet: Cabinet appointed by the president

Elections: president nominated by the People's Assembly for a six-year
term, the nomination must then be validated by a national, popular
referendum,
 National referendum last held 26 September 1999 (next to be held
NA October 2005);
 Prime minister appointed by the president .

Election results: national referendum validated President MUBARAK's
nomination by the People's Assembly to a fourth term.
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Government and Politics

Legislative branch:

Bicameral system:
 The People's Assembly or Majlis al-Sha'b (454 seats; 444 elected
by popular vote, 10 appointed by the president; members serve
five-year terms),
 The Advisory Council or Majlis al-Shura - which functions only
in a consultative role (264 seats; 176 elected by popular vote, 88
appointed by the president; members serve NA-year terms).

Elections: People's Assembly - three-phase voting


last held 19 October, 29 October, 8 November 2000 (next to be
held November 2005);
Advisory Council - last held 7 June 1995.
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Government and Politics

Legislative branch:


Election results: People's Assembly - percent of vote by party -
NDP 88%, independents 8%, opposition 4%; seats by party - NDP
398, NWP 7, Tagammu 6, Nasserists 2, LSP 1, independents 38,
undecided 2;
 Advisory Council - percent of vote by party - NDP 99%,
independents 1%; seats by party - NA
Judicial branch: Supreme Constitutional Court
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Government and Politics

Political parties and leaders:





Nasserist Arab Democratic Party or Nasserists [Dia' al-din
DAWUD];
National Democratic Party or NDP [President Mohammed Hosni
MUBARAK] - governing party;
National Progressive Unionist Grouping or Tagammu [Khalid
MUHI AL-DIN];
New Wafd Party or NWP [No'man GOMA];
Socialist Liberal Party or LSP [leader NA]
Note: Formation of political parties must be approved by the
government.
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Government and Politics

Political pressure groups and leaders:



Most significant political opposition: Muslim Brotherhood;
 Constitutional ban against religious-based parties,
 MUBARAK tolerated limited political activity by the
Brotherhood for his first two terms,
 MUBARAK moved more aggressively since then to block its
influence,
Civic society groups are sanctioned, but constrained in practical
terms;
Trade unions and professional associations are officially
sanctioned.
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt:









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
Economic Evolution over last decade

Macroeconomic performance improved by following IMF advice on fiscal,
monetary, and structural reform policies.

Results:
 Controlled inflation, lower budget deficits, and more foreign investment.

BUT, in the past four years:
 Less reforms + excessive spending on national infrastructure projects =
increase budget deficits.

Lower foreign exchange earnings since 1998 = pressure on the Egyptian
pound + periodic dollar shortages.
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Economic Evolution over last decade

Monetary pressures have increased since 11 September 2001 (declines in
tourism + Suez Canal tolls) = Egypt has devalued the pound several times
in the past year.

Future: The development of a gas export market is a major bright spot for
future growth prospects.

In the short term, regional tensions will continue to affect tourism and hold
back prospects for economic expansion.
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt:









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
Current Economic Situation

GDP
 purchasing power parity - $289.8 billion (2002 est.)
 real growth rate: 3.2% (2002 est.)
 per capita: purchasing power parity - $4,000 (2002 est.)
 composition by sector:
agriculture: 17%
industry: 34%
services: 49% (2001)

Population below poverty line:

Inflation rate (consumer prices):

Labor force:

Labor force - by occupation:
(2000 est.)

Unemployment rate:
22.9% (FY 95/96 est.)
4.3% (2002 est.)
20.6 million (2001 est.)
agriculture 29%, industry 22%, services 49%
12% (2001 est.)
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Current Economic Situation

Budget:
revenues: $21.5 billion
expenditures: $26.2 billion, including capital expenditures of $5.9 billion (2001)

Industries:
textiles, food processing, tourism, chemicals, hydrocarbons, construction, cement,
metals

Industrial production growth rate:
2.2% (2002 est.)
Production
2001
Consumption
2001
Oil
816,900 bbl/day
562,000 bbl/day
NA
NA
3.308 billion bbl
Natural gas
21.2 billion cu m
21.2 billion cu m
0 cu m
0 cu m
1.264 trillion cu m
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Exports
2001
Imports
2001
Proved Reserves
Current Economic Situation

Agriculture - products: cotton, rice, corn, wheat, beans, fruits, vegetables; cattle,
water buffalo, sheep, goats

Exports:

Exports - commodities:
products, chemicals

Exports - partners:

Imports:

Imports - commodities:
products, fuels

Imports - partners:
UK 4.1% (2002)
$7 billion f.o.b. (2002 est.)
crude oil and petroleum products, cotton, textiles, metal
US 18.3%, Italy 13.7%, UK 8.4% (2002)
$15.2 billion f.o.b. (2002 est.)
machinery and equipment, foodstuffs, chemicals, wood
US 16.9%, Germany 7.9%, Italy 6.7%, France 6.5%, China 5%,
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Current Economic Situation

Debt - external:
$30.5 billion (2002 est.)

Economic aid - recipient: ODA, $2.25 billion (1999)

Currency: Egyptian pound (EGP)

Exchange rates: Egyptian pounds per US dollar – 7.0 (2004 projection),
6.2 (2003), 4.5 (2002), 3.97 (2001), 3.47 (2000), 3.4 (1999), 3.39 (1998),
0.34 (1966).
Source: http://www.cia.gov/cia/publications/factbook/geos/eg.html
Current Economic Situation
DOMESTIC ECONOMY National Accounts Egyptian fiscal year ( July-June) US$ billions
unless stated otherwise
FY99/00 FY00/01 FY01/02 FY02/03*
GDP (current prices, LE billion) 340
359
382
405
GDP (current prices, US$ billion) 98.7
93.3
88.1
78.7
GDP real growth rate (%)
5.9
3.4
3.2
2.5
GDP/Capita US$
1420
1530
1470
NA
Government Spending/GDP (%) 30.0
30.1
29.9
31.5
Consolidated Fiscal deficit/GDP 1.20
2.23
2.50
2.90
Inflation (%)
2.8
2.4
2.4
4.0
Wholesale Price Index (%, June of each year) 1.6
1.3
3.5
18.5**
Unemployment (%)
9.0
9.2
9.0
9.9
Foreign Exchange Reserves
15.130
14.24
14.147
14.809
Reserves/months of imports
10.2
10.4
11.6
12
Avg. Exch. Rate for LE/$
3.446
3.850
4.338
5.149
End of Period Exch. Rate (June of each year) 3.446
3.860
4.510
6.154
Debt service ratio (%)+
8.0
7.4
9.3
9.8
Total Foreign Debt/GDP
28.2
28.5
32.6
35.7++
U.S. assistance (U.S. Fiscal Year) 2.035
1.995
1.955
1.915
Military
1.3
1.3
1.3
1.3
Economic
0.735
0.695
0.655
0.615
*Preliminary figures for FY 2002/2003 unless stated otherwise. ** As of May 2003 + Debt Service is ratio of external debt service to
current account receipts. ++ As of March 2003
Sources: Egyptian government, IMF, World Bank, & Embassy estimates based on those sources
Current Economic Situation
Key Sectoral Statistics
Tourism*
Revenues (USD million)
Total Arrivals (millions)
1999
2000
2001
2002
3904
4.797
4345
5.506
3800
4.648
3764
5.192
Energy and Petroleum **
Oil (crude) (avg. thous. barrels/day)
Gas (bill. cubic feet/day)
Electricity (mill, MKH, fiscal years)
852
1.4
67.9
710
1.7
72.9
639
2.4
75.6
631
2.6
83.0
Construction*** (million tons)
Cement (local sales +exports-imports)
Steel (production, rebars)
23.1
4.053
24.1
3.169
25.7
3.472
28.1
3.483
Agriculture****(million metric tons)
Wheat
Rice (milled)
Sugar
Cotton (thousand metric tons)
6.40
3.7
1.4
233
6.40
3.9
1.3
200
6.20
3.6
1.4
310
6.15
3.7
1.4
315
* Ministry of Foreign Trade ** Ministry of Petroleum, Ministry of Foreign Trade (Elect. figures for fiscal years)
*** EFG-Hermes, Ezz Steel **** US Dept. of Agriculture, cotton is marketing year: Aug.-Sep.
Current Economic Situation
TRADE AND INVESTMENT US
Calendar year US$ millions
1999
U.S. Exports to Egypt
3000.8
U.S. Imports from Egypt
617.6
US Trade Balance with Egypt 2383.2
U.S. FDI (stock)
2210
2000
3333.9
887.7
2446.2
1998
2001
3564.4
882
2682.4
2537
2002
2866.2
1351.9*
1514.3
2959
* Includes temporary import of Egyptian antiquities museum touring exhibition, valued at $445 million.
urce: U.S. Department of Commerce.
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt prior to their trip touching
on each of the following:









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
University Conditions

Cairo University : http://www.cu.edu.eg/

Cairo University has successfully been undertaking its mission of
delivering education, research and cultural duties over the years. It is
considered as the mother university among other younger universities in
Egypt

Cairo University is also offering its education and research facilities to
Arab and foreign students and scientists and has become well known
world wide.

Cairo University has 100 scientific Research Centers and units of Private
Character. There are also a hospital for the students, a printing press, a
central library as well as libraries for the faculties.

Currently, Cairo University includes 23 Faculties and Institutes serving
about 155,000 students with 3,158 faculty members, 2,361 assistant
lecturers & demonstrators and 12,233 employees.
Source: http://www.egyptsearch.com/search/search.cgi?cat=Education:Universities
University Conditions

Ain Shams University: http://net.shams.edu.eg/

Ain Shams University, as the third Egyptian university, was founded in
July 1950 under the name of "Ibrahim Pasha University".

When it was first established, Ain Shams University comprised a number
of distinguished faculties and academic institutes, which were later
developed into university.

The university includes 14 faculties and 3 high institutes.
Source: http://www.egyptsearch.com/search/search.cgi?cat=Education:Universities
University Conditions
Other Egyptian Universities:
Ain Shams University
AINSHAMS UNIVERSITY -FACULTY OF ENGINEERING
American University in Cairo
Assiut University
Cairo University Information Page
City University - Egypt
City University Computer Science Department
Egyptian Universities Network
Mansoura University
misr university for science and technology
Sheffield Hallam University
SunSITE Egypt
The Arab Academy for Science and Technology
Source: http://www.egyptsearch.com/search/search.cgi?cat=Education:Universities
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt:









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
National Development Priorities
of the Government

KEY ECONOMIC TRENDS AND ISSUES
 Macroeconomic
 Fiscal Developments
 Monetary Developments
 Privatization
 Balance of Payments
 Direction and composition of trade
 Impact of the War in Iraq

MAJOR LEGISLATIVE DEVELOPMENTS
Source: http://usembassy.egnet.net/etr2003.pdf
KEY ECONOMIC TRENDS AND ISSUES

Macroeconomic Outlook:

Egypt's economic performance and reform program in the 1990's gained
plaudits from international observers for increasing growth while sharply
reducing inflation and the budget deficit.

The combination of external shocks in 1997-98 (terrorist attacks, oil price
collapse, Southeast Asian economic crisis) and 2001 (September 11) with
a slowdown in reform efforts has reduced growth sharply since 1999.
KEY ECONOMIC TRENDS AND ISSUES

Macroeconomic Outlook:


Real growth for the fiscal year ending June 30, 2002 (FY 2001/2002, or
01/02) at 3.2% and estimated growth for FY 02/03, which ended June
30, 2003 at 2.5%.
With annual population growth at around 2%, that would put
real GDP per capita growth at under 1%.

Inflation estimated at 2.4 % for FY 01/02 and a slightly higher 3.9%
over the 12 months from May 2002 to May 2003.

Foreign debt increased slightly in 2001 and early 2002 as a result of the
Egyptian government's floating of a $1.5 billion Eurobond offering and
other borrowing, but remains comfortable at under $30 billion, or roughly
one third of GDP.
KEY ECONOMIC TRENDS AND ISSUES

Fiscal Developments:

The growing size of the budget deficit is one of the biggest challenges
facing the government and a potential threat to economic recovery.

In 2002, the government revised its budgetary accounts to show three
increasingly broad measures of the budget and deficits:



A narrow budget that includes only line government agencies and programs;
A broader definition that includes transfers to or from independent stateowned agencies,
A third definition that also includes the social insurance funds (social
security), currently in surplus because of Egypt's growing working-age
population.
KEY ECONOMIC TRENDS AND ISSUES

Monetary Developments:

The Government has been seeking a new monetary and foreign exchange
policy since it abandoned in mid-2000 its fixed peg of LE 3.4/$, in place
since the early 1990s.

The peg had been successful in reducing inflation to low single digits, but
proved untenable in the late 1990s as the pound became overvalued by at
least 35% and Egypt's balance of payments position deteriorated.
KEY ECONOMIC TRENDS AND ISSUES

Privatization:

The slowdown in the Egyptian privatization program, evident since mid2000, has been a source of concern for international rating agencies, that
consider the pace an indicator of the government’s willingness to move
forward on economic reform.

Senior officials, including the Prime Minister and Minister of Public
Enterprise, continue to emphasize Egypt’s commitment to the program.

The Ministry of Public Enterprise (MPE) announced in late 2002 an
effort to gradually privatize some state-owned enterprises by participation
of private investors in capital increases for the companies.
KEY ECONOMIC TRENDS AND ISSUES

Balance of Payments:
 Egypt's Balance of Payments (BOP) has continued to improve over the
past year.
 The overall BOP deficit of $447 million in FY 01/02 was smaller than
FY 00/01's deficit of $871 million which we had reported as the best in
several years.

Direction and composition of trade:
 The European Union (EU) as a bloc remains Egypt's largest trading
partner, typically accounting for around 35-40% of imports and exports.
 When implemented, Egypt’s Partnership Agreement with the EU could
result in a significantly larger volume of trade.
 The U.S. comes next (and is Egypt's largest trading partner as a country),
accounting for around 20% of imports and 10-15% of exports.
 Asian countries account for around 25% of both imports and exports.
KEY ECONOMIC TRENDS AND ISSUES

Direction and composition of trade:





Asian countries account for around 25% of both imports and exports.
Countries in the Middle East take 13% of exports and account for about
6% of imports, while Africa, Latin America and Australia account for less
than 5% each of imports and exports.
Egypt's leading merchandise export is crude oil and petroleum products
($2.2 billion in 2002), followed by finished goods (chiefly textiles and
apparel), and raw materials (cotton and other agricultural products).
Chief U.S. exports to Egypt include agricultural commodities (usually
around $1 billion annually), capital goods, and equipment.
The value of U.S. exports shrank over the last two years, from nearly $3.8
billion in 2001 to under $2.9 billion in 2002, largely in line with the drop
in overall Egyptian imports.
KEY ECONOMIC TRENDS AND ISSUES

Impact of the War in Iraq:






The Egyptian government, private sector forecasters, and we expected the
war in Iraq to have a major negative impact on Egypt's economy.
Estimates of that impact ranged from $2 billion to as high as $10 billion.
The impact was expected to fall most heavily on tourism (predictions of
$1-3 billion in losses).
In fact, largely because major combat operations in Iraq ended so quickly,
the impact in all these areas was much less than expected.
Suez Canal revenues actually rose significantly and tourism recovered very
quickly after a sharp dip in March 2003.
War risk premiums were never imposed.
MAJOR LEGISLATIVE
DEVELOPMENTS

Egypt's parliament, the People's Assembly (PA), approved several key pieces
of economic legislation in 2003.

New Banking Law:


Unified Labor Law:


It enshrines the principle of a market-determined foreign exchange rate and
defines the governmental and Central Bank roles in monetary policy.
Provides comprehensive guidelines for the recruitment, hiring, compensation, and
termination of employees in Egypt.
Telecom Law:

Expands the powers of the National Telecom Regulatory Authority to issue
licenses and permits, set standards for equipment, determine tariffs, and mediate
disputes between telecom service providers. Also, it protects users rights,
establishes a universal services fund, and provides for the disclosure of
information to promote transparency.
National Development Priorities
of the Government

SECTORAL TRENDS AND PRINCIPAL GROWTH SECTORS
 Services
 Tourism
 Suez Canal
 Banking
 Capital Market
 Insurance
 Energy
 Manufacturing
 Agriculture
 Transportation and Infrastructure
 Information Technology and Telecommunications

ECONOMIC COOPERATION
 Regional Initiatives
 U.S.-Egypt Trade and Investment Framework Agreement (TIFA)
 U.S. Economic Assistance
 U.S. Support for Trade and Investment
Source: http://usembassy.egnet.net/etr2003.pdf
SECTORAL TRENDS AND
PRINCIPAL GROWTH SECTORS

Services = 50% of Egypt's GDP (tourism and Suez Canal)

Tourism:
 Tourism is Egypt's largest foreign exchange earner, as well as a key engine of
growth = direct and indirect share of GDP is 11%.
 The tourism sector rebounded sharply from a steep decline after the 1997 terrorist
attack.

Suez Canal
 Revenues had been stagnant for the past several years at around $1.8 billion
annually because of increased global reliance on other means of transportation
(chiefly pipelines and air) for trade. Probably only part of the increase in revenues
can be sustained through the next fiscal year.

Banking:
 Positive events in the Egyptian banking sector
 = new management at the largest banks + efforts to improve supervision and
capital adequacy + renewed talk of decreasing government ownership in the
sector + a new banking law
 = likely to force a major consolidation of the sector
SECTORAL TRENDS AND
PRINCIPAL GROWTH SECTORS

Capital Market:


Insurance:


Egypt insurance industry remains very small relative to other middle-income
developing countries, with annual premiums accounting for only about 1.1% of
GDP.
Energy:




The Cairo and Alexandria Stock Exchange (CASE) experienced a bull market in
the first half of 2003 after a very quiet 2002, but continued growth will hinge on
regional stability and the pace of economic reform.
The oil and gas sector officially accounts for around 7% of GDP.
Gas exploration, development, and production have been among the brighter
spots in the economy over the past three years.
Oil production and exports still play an important role in the Egyptian economy.
Manufacturing:

Egypt's manufacturing sector accounts for approximately 20% of GDP. Main
sub-sectors include metallurgy, cement, fertilizers, textile/clothing, food
processing, and other consumer goods.
SECTORAL TRENDS AND
PRINCIPAL GROWTH SECTORS

Transportation and Infrastructure:



Egypt Air, the country's airline company, had a tumultuous year of
personnel and structure changes.
Reduced tourism, higher operating costs in the wake of new postSeptember 11 security and insurance requirements, the war in Iraq, the
pound's devaluation, and the global outbreak of the disease SARS all
affected Egypt Air’s operations over the past year.
Information Technology and Telecommunications:

The government has identified development of the information
technology (IT) industry as a national priority, and the Egyptian
Government and private sector are eager to engage with U.S. firms in this
area. Information technology (IT) in Egypt continued to grow in 2003
despite the overall sluggish economy.
ECONOMIC COOPERATION

Regional Initiatives:



Association Agreement with the European Union: increased access to the
European market + 615 million Euros in project assistance grants + 1.1
billion Euros in loans from the European Investment Bank to help
modernize Egyptian industry.
Member of the Common Market for Eastern and Southern Africa
(COMESA) since mid-1998, and is committed to eliminating tariffs with
COMESA members entirely by 2004.
Aghadir Agreement:


Goal = establish a free trade area with Tunisia, Morocco, and Jordan.
U.S.-Egypt Trade and Investment Framework Agreement (TIFA):


Goal: facilitating the concrete measures to establish freer trade.
Work in Progress on: government procurement, customs reform and
administration, sanitary/phytosanitary issues, and agricultural trade.
ECONOMIC COOPERATION

U.S. Economic Assistance:




Over $25 billion in economic assistance since 1975.
Results: the foundations for economic growth = infrastructure (water,
wastewater, power, and telecommunications) + favorable economic policy
environment for private sector development.
New areas of concentration: development of the information technology
sector, strengthening Egypt’s capacity for human resource development,
trade policy capacity building, financial sector reform, and continuing
efforts to enhance Egypt’s business and export competitiveness.
U.S. Support for Trade and Investment:

The Overseas Private Investment Corporation (OPIC), the U.S. ExportImport Bank (Ex-Im Bank) and the Trade and Development Agency
(TDA) are committed to supporting the growth of U.S.-Egyptian bilateral
trade and investment. These agencies provide loan and insurance
products and services.
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt:









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
Graduate Employment
and Job Market

Unemployment is officially estimated at 9.9% in FY 02/03, up from 9% in
FY 01/02 and 9.2% in FY 00/01.

Other observers suggest the effective rate of unemployment is significantly
higher.
Underemployment and reliance on the informal economy (often estimated at
one third to one half the size of formal GDP) are also major features of
Egypt's economy, as in most developing countries.


Government figures estimate that, out of a total work force of 20.2 million
and total employment of 18.2 million, 6.9 million individuals are employed in
the "irregular private sector," compared with only 5.1 million in the formal
private sector, 5.3 million in the government, and 900,000 in state-owned
enterprises.
Graduate Employment
and Job Market

Egyptian governmental and private estimates put the number of job seekers
entering the labor market annually at 500,000-700,000.

Even during the high growth years of the 1990s, employment creation did
not fully meet the demand for jobs.

The sluggish growth of recent years has widened the gap between the
number of job seekers and available employment, particularly for the better
educated.
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt:









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
Ease of Entrepreneurship

Top websites:



www.socialfundofegypt.org
http://www.sfdegypt.org/index_e.asp
www.sedo.org

US Agency for International Development (USAID):
http://usembassy.egnet.net/usaid.htm

Investing in Egypt:
http://usembassy.egnet.net/Invest.htm
Economic Trends Report - Egypt [PDF]
Investment Climate Report - Egypt, July 2003 [PDF]
Country Commercial Guides for EGYPT
Background Notes: Egypt
U.S. Government Sites
Egyptian Government Sites
Selective Economic Web sites
Non-Governmental Sites

American Embassy:
http://usembassy.egnet.net/
University of Arizona
Egypt Orientation Session
January 28, 2004
A broad and general understanding of Egypt:









Background information,
Government and politics,
Economic progress and development efforts over the last decade,
Current economic situations,
University conditions,
National development priorities of the government,
Graduate employment situation and the job market,
Ease of entrepreneurship development and small business support,
U.S.-Egypt relations and general perceptions of attitude towards
Americans in-country and why.
US-Egypt relations and general
perceptions of attitude towards American
in-country and why.
POLITICAL ISSUES AFFECTING THE BUSINESS CLIMATE

Nature of Political Relationship with the United States:
“The United States and Egypt enjoy a strong and friendly relationship
based on shared mutual interest in Middle East peace, stability and
regional security, combating international terrorism, strengthening trade
relations, and revitalizing the Egyptian economy. Multinational exercises,
U.S. assistance to Egypt's military modernization program (valued at $1.3
billion annually), and Egypt's role as a contributor to various UN
peacekeeping operations continually reinforce the U.S.-Egyptian military
relationship. Egypt is our indispensable partner in the quest for regional
peace, and it works closely with the U.S. to that end.”
Source: http://usembassy.egnet.net/etr2003.pdf
Have A Good Trip

Weather:

Cairo has only two seasons: summer and 'not-summer‘, a
period that stretches roughly from September to April or
May.

January and February (10-20°C/50-68°F) can be overcast
with the occasional shower, but the months immediately
either side are comfortably warm, with daytime temperatures
leavened by breezes.

Weather forecast:
http://www.egyptdaily.com/
Source: http://www.lonelyplanet.com/destinations/africa/cairo/facts.htm
Have A Good Trip

Restaurants:

The Egyptian Cuisine is Mediterranean most like the
Greek..



A wide variety of international fast food (Arby's,
McDonalds, KFC, and Pizza Hut) and theme
restaurants (Planet Hollywood, Chille's) operate in
Cairo.
Continental cuisine, American, and Egyptian
Cuisine are available.
Some addresses:
Felfela
Restaurant
Fast Food
Coffee Houses
L`Aubergine
Cafe Riche
Johnny Carino's
Maison Thomas
Naguib Mahfouz
Source: http://www.virtualtourist.com/vt/1ea6ae/2/