Abu Dhabi--Egypt will push ahead with economic reforms in order to achieve the targeted US$10 billion in foreign direct investment in the 2010-11 fiscal year, a senior official said on Wednesday. Egypt's FDI halved to US$7 billion in 2009 from US$14 billion in 2008 due to the financial crisis, said Rachid Mohamed Rachid, Egypt's minister for trade, industry and investment. "We expect foreign direct investments of about US$10 billion for this year (2010-11) and a minimum of US$20 billion in three years," he told reporters in Abu Dhabi. "This is not an easy target, we have to do a lot of reforms which we will continue to do," he said, adding planned reforms in the country relate to land, regulations, and investments. Egypt's fiscal year ends on 30 June. Rachid also said he had held talks with the Abu Dhabi Investment Authority (ADIA), the emirate's sovereign wealth fund. One of the world's largest sovereign wealth funds, ADIA already has investments in Egypt, he said. "We offered ADIA to participate in joint ventures in funds in Egypt and there is preliminary interest from ADIA and other investors from the UAE to invest in some projects," he said. Egypt is currently targeting investments in four major infrastructure and industrial projects, namely Port Said, Suez, West Alexandria and the Upper Egypt, he said. The UAE is the second largest Arab investor in Egypt with net investments totaling US$5.11 billion between 2005 and 2010, according to a statement released on Wednesday from the General Authority for Investment, Egypt. Egypt's trade with the UAE stood at US$994.3 million in 2009 with exports totaling US$558.6 million. Egypt, the world's biggest wheat importer, is seeing its finances deteriorate under the impact of rising food prices. The country imports about 6 to 6.5 million tons per year. "Food security is still a concern and cost escalation, especially in wheat prices, is having a negative impact on our budget," Rachid said. He estimated the cost of Egypt's wheat price subsidies at between LE2.5 billion and LE4 billion this year. Cairo is still in negotiations with Russia for supply of the contracted 0.5 million tons of wheat shipments, Rachid said, but added that Egypt had managed to secure supplies from France, Canada and the United Kingdom. Russia, Egypt's top wheat supplier, has banned grain exports until year-end to address a massive drought. Rachid said Egypt always has four to five months reserves of wheat, but he added: "We are hoping they (Russia) will come back to the market soon."
