Partners in economic success
“The US will do all it can to support Egypt’s success,” said Robert Beecroft, the United States Ambassador to Egypt during AmCham Egypt’s pre-annual general meeting held April 28. Noting that this success will only come with economic prosperity, Beecroft stressed, “It is critical for Egypt’s economy to thrive.”
There are many challenges ahead, however, starting with a population expected to double in less than 30 years. “Population growth, of course, can strain a country’s natural resources, infrastructure, energy supplies, environment and social services,” said Beecroft. “However, I emphasize the word ‘can’ here. It doesn’t necessarily have to.” The second biggest challenge is the increasing unemployment. Beecroft noted that Egypt must create around 700,000 new jobs every year to absorb new workers entering the labor market. The third hurdle is providing a proper education. “The simple fact is that the world is moving ever more rapidly towards a knowledge-based economy. The work force has to be better educated,” he said. Energy shortages form the fourth obstacle, one that has plagued economic growth as Egypt moved from being a net exporter to a net importer of oil. The fifth obstacle is the lack of “smart regulation,” said Beecroft. “Having smart regulations is a key factor to determine where you open a business.”
“The encouraging news is that current government in Egypt understands these global challenges and has demonstrated the leadership to take tough choices to start addressing them. I am speaking about the new investment law, changes to the tax law and steps to reform,” the ambassador continued. “Also encouraging are reforms still to come, which President Abdel Fattah el Sisi talked about in Sharm el Sheikh [Egypt Economic Development Conference held March 2015].”
As a strategic partner, the U.S. has long supported Egypt’s economic growth, particularly through USAID, which has channeled nearly $30 billion since 1975 to support regulatory and customs reform, help government streamline business registration, and improve school and university education and training for Egypt’s labor force. “Today, the USAID program remains one of the largest in the world,” Beecroft said. In coordination with the Ministry of Health, the U.S. Centers for Disease Control and Prevention is supporting Egypt’s healthcare goals with a $35 million program to stem the spread of hepatitis C.
To help American companies wishing to do business in Egypt, AmCham Egypt, the Egypt-U.S. Business Council and the U.S. Chamber of Commerce in November 2014 organized the largest trade delegation to date, bringing 150 executives representing over 60 companies to Egypt. Beecroft also noted the U.S. government’s special focus on entrepreneurship: “It is one of the most powerful engines for economic growth.” The U.S. Embassy has provided $15 million to support the entrepreneurial ecosystem in Egypt, organizing workshops and training for over 23,000 Egyptians in business and management skills. “This July we will invite a delegation of Egyptian entrepreneurs to travel to Kenya, joining President Barak Obama at the annual global entrepreneurship summit,” said Beecroft.
Egypt is also one of a handful of countries with preferential access to the U.S. market via the Qualifying Industrial Zones, accounting for over half of Egypt’s exports to the United States, bringing in $1 billion in foreign currency and providing 280,000 jobs in Egypt.
However, no matter how strong relations are between governments, there is no substitute for the private sector. “Ultimately, Egypt’s economic success will depend on businessmen,” said Beecroft. “At the end of the day, only business can drive exports, bring in investments, transfer technology and expertise and create the jobs that will move this economy forward.”