Cairo officials are in talks with the Abu Dhabi Investment Authority as they try to secure $20 billion in foreign investments.
Egypts seeks investments from ADIA
Egyptian officials have held talks with the Abu Dhabi Investment Authority (ADIA) as the north African country targets US$20 billion (Dh73.25bn) in foreign investment in the next three years.
Ministers held talks with the Abu Dhabi sovereign wealth fund about investment in joint venture funds in the country.
They also discussed opportunities to invest in infrastructure projects, Rachid Mohamed Rachid, the Egyptian minister of trade and industry and acting minister of investment, said yesterday.
"There is a lot of interest from ADIA about investing in Egypt and ADIA is also already an investor in Egypt including investment companies and financial firms," said Mr Rachid. "We are offering ADIA the opportunity to invest in joint venture funds we are creating in Egypt, and negotiations are continuing on that."
ADIA had also been presented with opportunities to invest in four major projects Egypt is creating, spanning industry, infrastructure and property, to spur economic development and build jobs.
The UAE is already the third-largest foreign investor in Egypt, with the country's investment amounting to 13 per cent of the total capital in Egyptian business.
Egypt is keen to attract foreign direct investment (FDI) from the UAE as it tries to revive its economy after the global financial crisis stinted its job-creation plans.
The country's GDP growth dropped from slightly over 7 per cent in the three years before the downturn to 4.7 per cent.
The government has set a target of 6 per cent growth this year, a level it says is needed to generate sufficient jobs for its fast-growing population. Under its growth plan drawn up in 2004, Egypt set a goal of adding between 650,000 and 750,000 extra jobs every year.
"To help achieve this, we are hoping the Emirates will continue to be a major investor," Mr Rachid said.
FDI slowed after the financial crisis, halving from $14bn last year to $7bn this year. Egypt wants to attract $10bn of investment next year and $20bn within three years.
Mr Rachid said the government would be announcing a number of economic reforms in the next few weeks to improve the business environment for potential foreign investors, including easier access to land.
Food and agriculture is another component of UAE investment Egypt is looking to boost. Like the UAE, Egypt is heavily dependent on imports of wheat and other basic food staples. It has also been affected by recent rises in soft commodities, partly due to bad weather conditions in exporting nations such as Russia, Pakistan, the US, Canada and Europe.
The trade delegation met with a number of UAE companies with existing stakes in farmland projects.
"We have already [a] number of projects being financed by Emirati companies in Egypt; that is something we totally support and encourage," Mr Rachid said.
"I met some of [the] investors and I shared some of the plans we have to encourage even more agri-business."
A spokesman for ADIA declined to comment on its meeting with the Egyptian delegation or its investment in Egypt.
According to the firm's annual review, ADIA does not typically invest in the Gulf region, except where those investments constitute part of an index.
More than 80 per cent of ADIA's investments are handled by external fund managers.