Diplomat in Egypt encourages Chinese to get involved

A senior Chinese diplomat in Egypt welcomes the participation of Chinese enterprises in major projects launched by the Egyptian government and in other explorations of the country's market.

Han Bing, minister counselor for economic affairs at the Chinese Embassy in Egypt, told China Daily that the embassy encourages Chinese enterprises, whether state-owned or private, to explore the Egyptian market, especially in strategic projects such as the construction of a new and refurbished new capital.

China State Construction Engineering Corp recently signed an agreement to invest $15 billion (14.1 billion euros; 11.9 billion), and China Fortune Land Development Company, which has committed $20 billion to the new capital project.

The project, 45 kilometers east of Cairo, is located between the old capital and Suez, a city along the Suez Canal. It is expected to serve the economic and social development of the Suez Canal Economic Belt and the Red Sea Economic Belt.

However, whether the Chinese enterprises will be successful depends on various factors from both the enterprises and the Egyptian government, Han says.

On one side, as investors, the enterprises should have enough financial strength and be aware of and adapt to the local culture, religion and customs, he says, adding that they should use international professionals for attracting investment, as well as for management and operations, as the vision involves not a single project but a comprehensive new city.

"The CFLD had some experience in building new towns in the domestic market. It wishes to copy its business model from China in Egypt," Han says. "Generally, it is promising to get involved in a project in Egypt, as the country has a relatively steady environment for business."

On the other side, policies of the Egyptian government - infrastructure conditions such as land use, water, power, fuel supplies and preferential policies for attracting investment - are also crucial to the success of the project, Han says.

Smooth operation of the project requires a high administrative efficiency and transparent law from the host government, he says.

Egypt enjoys a good infrastructure compared with other African countries. The railways and highways in the country have complete networks. It is a market with a population of more than 90 million people. It also enjoys good trade relations with the European Union, the Middle East and other African countries.

Egypt's high proportion of young people, and people with high qualifications, are some of its other advantages.

Above all, its market environment, peripheral markets and political stability will also contribute to the success of the project, Han says.

He adds that the political situation in Egypt is quite favorable for the foreseeable future. However, the environment in nearby countries, such as Libya, and its own economic situation is not so optimistic.

The country is plagued by a shortage of foreign exchange reserves, and foreign investors are not so keen on the city-building project.

The key to a smooth project lies, to great extent, in its success in attracting foreign investment, Han says.

The land development company is confident, based on its past experience in the domestic market, about building a new industrial town as part of the massive Egyptian plan for building a new capital, he says, admitting that the company's international market management experience remains a challenge.

liuhongjie@chinadaily.com.cn

(China Daily Africa Weekly 12/09/2016 page7)