Aliaa El Sallab Hossam Mostafa Interview
The Ceramic market in Egypt before and after the revolution.
Interview Transcript
Interviewer:
Interviewee:
Date:
Place:
Aliaa El Sallab
Hossam Mostafa
27/09/11
Narrator’s office
Block 13034, Al Obour City
Cairo, Egypt
02-46102080
College:
Professor:
American University in Cairo
Dr. Kim Fox
Date completed: 27 Sep. 11
1 /7

Aliaa El Sallab Hossam Mostafa Interview 2 /7
Mr. Hossam Mostafa is the Vice Chairman of Royal Ceramica, he was born in Mansoura, Egypt on September 3, 1986. Hossam Mostafa is engaged to be married to Ms. Marwa Saleh in December. He graduated from The American
University in Cairo in the year 2007 and has been working in his family’s company since then. Even though Mr. Hossam is a young man he has worked very hard to achieve his place in the company, he has put Royal Ceramica in one of the top ranks compared to other companies that has been around for a longer time than Royal Ceramica. The company first started in 2004 even though the family has been working in the ceramic business for more than 50 years going through all the past generations.
The reason I chose Mr. Hossam for my interview was because of my interest of the Egyptian economy and its fall, especially after the Egyptian
Revolution. Royal Ceramica is not based only in Egypt; it sells to many other countries in the Middle East North African region and around the globe as well.
Mr. Hossam has been fighting to prove that the Egyptian product is a heavy and strong product that can compete internationally with some of the big names around the world.
With the big hit in the Egyptian economy many people thought that a huge percentage of the factories in Egypt are willing to shut down. The reason for that was because there are no more customers who are willing to buy any new product, no new investors willing to make business in the country and all the old international investors want to finish their old deals so they would stop working. This was because there was no money and very few companies had the cash to continue working and producing products in the finest quality. Which is

Aliaa El Sallab Hossam Mostafa Interview 3 /7 why I wanted to know if there was any truth to those rumors of business stopping in Egypt.
The reason I was so interested in that topic specifically is because I have heard in the news about many investments stopping and the country is losing a lot of money. I wanted to hear first hand what really is going on and what is the truth about the Egyptian market even in one sector of it which is the Ceramics market.

Aliaa El Sallab Hossam Mostafa Interview 4 /7
27 September 2011
Persons present: Aliaa El Sallab - I
Hossam Mostafa - VP
First I would like to ask you a few questions so the audience would get to know you
El Sallab: What is your name?
Mostafa:
El Sallab:
Mostafa:
Hossam Mostafa
What is your title of work?
The vice chairman of Royal Ceramica
El Sallab:
Mostafa:
El Sallab:
Mostafa:
El Sallab:
Mostafa:
Where do you live? (Your district Giza, Heliopolis…)
No in Heliopolis area
How old are you?
I’m 25
How long have you been working?
On full time basis for more than (for about) three years now.
El Sallab: What was the ceramic market like in the past few years compared to the market after the Egyptian Revolution?
Mostafa: the ceramics market in the past 10 years have changed tremendously, usually were very focused on seasonality’s and timing of the summer season, before school season, the return of Egyptians abroad, there are two or three seasons in the year mainly they are all focused from march till the end of September when everyone was willing to start renovations in their houses with the construction work starting to pick up in the past ten years with new compounds, new districts, people starting to get out of the city which happened not only in Cairo, it happened all over
Egypt you’d find even in Upper Egypt you’d find New Sohag, you’d fine new everywhere in all Egypt you’d find people starting to get out of the city starting new construction, so mainly in the past ten years the seasonality have been declining too much and work have been starting to be steady all year long with of course the main season of the summer, which people start to renovate when they go out

Aliaa El Sallab Hossam Mostafa Interview 5 /7 to Alexandria, go to the north coast, there is more capability for people to have things renovation in their houses, because the kids are not in school, so the summer is our main timing plus the market dynamics have changed due to the change in Egypt with the constructing, were too closely related to construction. Which takes us to after or post revolution, (this) the market with its main link to construction, although were a bit delayed when you start speaking of construction cycles we have a delay, we finish in furbish the construction projects that are already done so right before the revolution people stopped investing in all their construction projects to know what’s going to happen but very quickly a month, a month and a half after the revolution people started to finish their open projects which in return had the ceramics market going up. We will feel a decline, a major decline in our field during the next, let’s say eight to ten months because the construction work have been tremendously hit in the past eight months, and we as I just said were a bit delayed so we usually count on the project that should have started in February and march and April we start to furbish them by December, and Jan. 10 or 8 months later. So the main hit for our market is still to be seen, and thanks to our strong presence as Egypt and the
Egyptian ceramic market in the MENA (Middle East North
Africa) region especially, we could maneuver for a bit by exporting our products. Although there is also a hit in the
MENA (Middle East North Africa) region and honestly speaking the Egyptian ceramics hasn’t taken yet the position in the global market as the ceramics market abroad is huge and there are two big players in the market especially China and Italy with one of them very superior quality and very known for its high end in Fashion and quality in everything and also in pricing and the other competitor, big market which is china with its massive, massive production and of course cheaper products and they’re starting to pick up a bit even in their quality, so were in the middle in between china and Italy. And when I say china I also add in it in India, in the places that follow the lead of China and Italy they’re also…
So we’ve managed now to maneuver a bit in our regional market in MENA (Middle East North Africa) region especially in like Saudi, Syria, now Libya is off the market is totally stopped, morocco is a good market, and thanks to the logistics of our product it’s a heavy product, you pay a lot to transfer and transport the product which is mainly giving an edge for our local production versus Chinese production as when you would buy from china you’d have to pay a lot to transport the product from china to Egypt,

Aliaa El Sallab
El Sallab:
Mostafa:
El Sallab:
Mostafa:
Hossam Mostafa Interview 6 /7 per say, so until now we have had a hit, a small hit in our production and were forecasting a major hit in 2012.
But now the summer season has just ended how is it compared to last year’s summer?
2011 has completely different demographics, situation from all the years in the past that we have passed through.
February we didn’t sell one tile in the market in the local market in half of March we started to take up from there so everyone there has been quite a shift during the year. So the summer season has changed with Ramadan coming also, its known that in Ramadan there are no ceramics sales what so ever and Ramadan came this year in the middle of the summer so we have a complete demographic situation or a complete season that we have never seen before, it’s mainly, it has been not so bad as we started to distribute all the production on through out the year but I have been saying the seasonality’s were starting to decline and this year no one can predict, and this is not only in Egypt because of the revolution after the economic crisis everything started to change. We have a special scenario in
Egypt but the same is happening in other countries in the region and even in Europe now the economic crisis the follow ups with the economic crisis in 2008 is also working in there is a major hit in Spain, Greece and Italy. The market is changing for the ceramics world due to our very closely related link to construction.
So the international market, there are no big investors that are wiling to take your product right now because the economic crisis around the world?
We have a good a good thing about our production and about the Egyptian product in ceramics as I have been saying the product is very heavy and for us and our short distance from here to mainly Eastern Europe, the European market, Western European market, the Middle East and this region, Africa which is I confess that no Egyptian producer and very minimal amount of European producer have been to Africa as the transportation cost for us is good compared to other Chinese markets also there is a tariff increase of the Chinese products in Europe so were seen as a good quality product not as good as the European products especially the Italian product. Were actually good in the same range as the Spanish products but not as good as the
Italian. So were seen as a cheap alternative to the Italian products. We had a chance to have more presence in the
Italian market and the European market, not the Italian

Aliaa El Sallab Hossam Mostafa Interview 7 /7 actually the European market, especially eastern Europe and now also maybe a good start in the UK (United
Kingdom) not to take all the production because we need to have a good period of building trust between us and the involvement of the Egyptian product in the European markets.