Regional business and political leaders' commitment to reform will be placed under the microscope at the World Economic Forum meeting in Sharm El-Sheikh, report Niveen Wahish and Injy El-Kashef The World Economic Forum (WEF) on the Middle East, scheduled for 20-22 May in Sharm El-Sheikh, comes at a precarious moment. Domestic tensions are growing as the confrontation between judges and the state escalates; emergency rule has been extended for a further two years; Egypt's tourist industry has still to calculate the impact of last month's Dahab bombings and regional stock markets continue their nose dive. Yet the message Egyptian officials are keen to deliver to investors at the forum has not changed -- Egypt is ready and open for business. While Hanaa Kheireddin, executive director of the Egyptian Centre for Economic Studies, suggests that recent events "give the impression that things are not very stable and the government not in control", other economic analysts believe the government has a strong case to make. "The reforms undertaken in the past two years have created a good foundation for marketing Egypt," insists Yasser El-Mallawany, chairman and CEO of EFG-Hermes, one of the forum's strategic partners. Tariffs and taxes have been drastically reduced, the privatisation programme given a new lease of life and a package of legislation introduced to support private sector-driven growth and improve competitiveness. But Egypt will not be the only focus of attention at the Sharm El-Sheikh meeting. "This forum offers a chance to draw global attention to investment opportunities across the Arab world," adds El-Mallawany. The boom in oil prices has had a positive impact on some Arab economies, and since 9/11 many Gulf states have shifted their investment strategies away from the US market. At the same time, however, "the ability of the [region's] countries to respond and adapt to a rapidly changing global economic landscape," will be the key factor in whether or not investments can be sustained, WEF founder and chairman Klaus Schwab told Al-Ahram. While politics has dominated previous WEF meetings on the Middle East -- the first annual meeting, held in Jordan in 2003, was billed as a "summit of reconciliation" for the post-Iraq war period -- this year the emphasis will be on economic rather than political performance, and the forum convenes under the optimistic theme of "the promise of a new generation". The aim, says Sherif El-Diwany, WEF's director for the Middle East and North Africa, is to "deliver a better future for the generations to come". Providing economic security and job opportunities for the people of the region has become an urgent priority, says El-Diwany. For Schwab, that means, "far reaching reforms are required. The quality of the national business environment must be enhanced." he thinks, "leaders in the region are becoming more cognizant of the urgency for reform, realising the dangers and costs of inaction." Policy-makers will have their hands full. Arab economies attract less than one per cent of global foreign direct investments, while inter-Arab trade cooperation is still in its infancy despite the activation of the Greater Arab Free Trade Area in 2005. Unemployment is growing, and the labour force in the Middle East and North Africa region is expected to reach 200 million within two decades. "Even to maintain unemployment rates at present levels, tens of millions of jobs will need to be created," Schwab said. "Of course, to actually bring unemployment rates down to more sustainable levels, job creation will have to be more ambitious, in excess of a 100 million new jobs between 2020-25. This is a huge challenge for policy-makers and the business community." In an attempt to give some momentum to inter- Arab coordination the Arab Business Council will launch an Investment Taskforce Initiative during the forum, bringing together CEOs from the Arab region and their counterparts from China, India and the G8 to identify the "matrix of impediments to investment" in the Middle East. But however tightly the organisers seek to script the event there will be no avoiding political questions, not when Iraq and the Middle East peace process are floundering, the spectre of conflict with Iran is looming large and advocates of political reform in Arab countries grow more vocal by the hour. Add to this the participation of high-profile Palestinian, Iraqi, US and Israeli delegations, and thorny political issues are bound to emerge. The Lebanese president and prime minister, the Malaysian prime minister, the Emir of Qatar Sheikh Hamad Bin Khalifa Al-Thani, Turkish Prime Minister Recep Tayyip Erdogan and the Crown Prince of Abu Dhabi Sheikh Mohamed Bin Zayed Al-Nahyan are all scheduled to attend. Yet given the imminent arrival of so many global leaders, Sharm El-Sheikh is unexpectedly calm, and though the land route connecting Cairo to the Red Sea resort is punctuated by a multitude of checkpoints, with scrutiny of passengers' identification papers growing as the distance to their destination diminishes, in Sharm itself it is business as usual. Along the café and restaurant strewn promenade the owners of businesses complement their finely-honed hospitality skills with even warmer smiles in an attempt to off-set the impact of last month's suicide bombings in nearby Dahab. Nor is the security presence as overwhelming as might be expected. A driver affiliated with one of the more luxurious of the town's resort complexes told Al-Ahram Weekly that life not only continues, but that residents and workers alike are increasingly determined to withstand the economic effects of the diminished numbers of tourists. "Are we apprehensive about the forum coming so soon after the recent blasts? Not really. We are confident the city will be under complete control. There will be no one here except conference delegations and the press since they are basically closing the town to anyone else." Holiday-makers confirm the driver's information. Tourists interviewed by the Weekly say it is impossible to book hotel rooms during the conference week. "It would have been far more convenient for me to come next week," said one French tourist who was looking forward to experiencing Sharm El-Sheikh's world famous diving sites. "Not a single hotel could confirm a booking except in the week preceding or following the conference." Said Ezzeddin, Sharm El-Sheikh branch manager of Abercrombie & Kent, insists that tour companies received no instructions to halt reservations for the duration of the conference. "It is simply that Sharm is fully booked, especially the more prestigious hotels." The five-star hotels scheduled to host delegates are on high alert in preparation for the high-profile event, with increased numbers of security personnel busy ensuring no last minute glitches mar the global leaders' discussions of Middle Eastern business affairs. Additional reporting by Mohamed Sabreen
