Economic relations between Egypt and Britain are solid, regardless of political machinations, writes Gamal Essam El-Din A recent report by the Foreign Relations Committee of the House of Commons in Britain was uncharacteristic in many ways. It not only urged London to open dialogue with Islamist movements such as Hizbullah in Lebanon and Hamas in Palestine, but also use its good economic and political relations with Cairo to encourage Egypt to improve its democracy and human rights record. The report, issued two weeks ago, was not received well by some in Cairo who believe that the House of Commons is following the lead of the US Congress by using economic relations as a tool to exert political pressure on Middle East allies, such as Egypt. But Keith Melville, director of trade and investment at the British Embassy in Cairo, reassured reporters last week that for London, "trade transcends politics". Speaking to reporters, Melville noted that economic ties and trade relations between Egypt and the UK is witness to this motto. He cited that the number of British companies investing in Egypt almost tripled from 217 in 2001 to 610 this year, including high-profile corporations such as British Gas, British Petroleum, Shell, Vodafone, Barclays, HSBC, GlaxoSmithKline, AstraZeneca and Unilever. "The UK's investment portfolio in Egypt is diverse and includes oil and gas, financial services, pharmaceuticals and telecommunications," stated Melville. British investors are also tapping new sectors such as railways, water, irrigation, education, textiles and software programming. He added that work is underway to upgrade the Egyptian Mint Authority through importing modern British equipment and print machines for minting LE250 million in Egypt. Many British investors, explained Melville, use Egypt as a gateway to neighbouring markets such as AstraZeneca exporting pharmaceuticals to Algeria from Egypt. The diplomat's assertions are confirmed by figures from General Authority for Investment and Free Zones (GAFI), which show the UK as the second largest non-Arab investor in Egypt, after the United States. British investments are currently estimated at $20 billion, a figure which has multiplied many times over since 2001 when the figure stood at a mere $4 billion. GAFI statistics also show that the UK is Egypt's fourth largest export market, with bilateral trade estimated at approximately $2.4 billion in 2006. Egyptian exports to the UK in 2006 almost doubled to reach $1.35 billion. In fact, the trade balance between the two countries has tilted in favour of Egypt for the past six years, mainly because of Cairo's decision to float the Egyptian pound and undertake several economic reforms, according to Melville. He believes that Prime Minister Ahmed Nazif's government has done a good job in improving economic conditions. "The macro-economic indicators are very good, and there has been a big surge in international investments flowing into Egypt," noted Melville. The diplomat explained that British businesses base their investment decisions on several factors, with politics at the tail end of the list. Instead, they focus on "the country's business climate, the quality of financial services and cost effectiveness," stated Melville. He asserted that negative coverage of the political environment in Egypt by the British press is not central in business decisions. "I do not think that the British people and businesses base their decisions of going to Egypt upon reports made by the British press," he assured. Elaborating further, Melville noted that the UK is the largest market of tourists to Egypt, with over a million Britons visiting in 2006. "Although most of these tourists are aware that the Middle East is rife with terrorist dangers, yet they choose to come to Egypt," he said. The same applies to business, Melville continued, citing the fact that the sale of The Economist 's annual country report on Egypt was the highest after Russia and China as a "prominent sign that British investors are interested in Egypt as a big promising market." Assisting Egyptian-British economic relations is the Egyptian British Business Council (EBBC), which was created in 1998 during a visit by former prime minister Tony Blair. EBBC, headed by prominent businessman Mohamed Nossair and Vodafone chairman on the Egyptian side, has played a pivotal role in boosting bilateral economic relations. Its members include some of the most prominent businessmen in both countries, especially big British investors in Egypt. At the next meeting in Cairo, scheduled in January, EBBC will discuss the importance of training business leaders, opening new horizons for mutual investments and long-term sustainable projects. Melville emphasised that regardless of the political picture, the coming period will witness intense efforts to boost economic and business relations between the two countries. A delegation of Scottish businessmen will be in Egypt next February to explore investments in the gas and oil sectors. "This is in addition to other Scottish experts who currently work with the Ministry of Communications and Information Technology to upgrade the system of property ownership registration," said Melville. Meanwhile, in March, 2008, the Lord Mayor of London will visit Egypt to forge relations between this leading international financial city and Cairo.
