SCZONE showcases investment opportunities to eight Japanese companies    Egypt urges Israel to accept Gaza deal amid intensifying fighting    Egypt, ADIB explore strategic partnership in digital healthcare, investment    Egypt's PM meets Tokyo governor, witnesses signing of education agreements    Egypt welcomes international efforts for peace in Ukraine    Al-Sisi, Macron reaffirm strategic partnership, coordinate on Gaza crisis    Egypt's Sisi, France's Macron discuss Gaza ceasefire efforts in phone call    Contact Reports Strong 1H-2025 on Financing, Insurance Gains    Egypt, India's BDR Group in talks to establish biologics, cancer drug facility    AUC graduates first cohort of film industry business certificate    Egypt to tighten waste rules, cut rice straw fees to curb pollution    Indian tourist arrivals to Egypt jump 18.8% in H1-2025: ministry data    Egyptian pound down vs. US dollar at Monday's close – CBE    Egypt prepares unified stance ahead of COP30 in Brazil    Egypt recovers collection of ancient artefacts from Netherlands    Egypt harvests 315,000 cubic metres of rainwater in Sinai as part of flash flood protection measures    Egypt, Namibia explore closer pharmaceutical cooperation    Fitch Ratings: ASEAN Islamic finance set to surpass $1t by 2026-end    Renowned Egyptian novelist Sonallah Ibrahim dies at 88    Egyptian, Ugandan Presidents open business forum to boost trade    Al-Sisi says any party thinking Egypt will neglect water rights is 'completely mistaken'    Egypt's Sisi warns against unilateral Nile measures, reaffirms Egypt's water security stance    Egypt's Sisi, Uganda's Museveni discuss boosting ties    Egypt, Huawei explore healthcare digital transformation cooperation    Egypt's Sisi, Sudan's Idris discuss strategic ties, stability    Egypt to inaugurate Grand Egyptian Museum on 1 November    Greco-Roman rock-cut tombs unearthed in Egypt's Aswan    Egypt reveals heritage e-training portal    Sisi launches new support initiative for families of war, terrorism victims    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Moving in the right direction
Published in Daily News Egypt on 20 - 05 - 2006

CAIRO: While no one can deny that the investment climate in Egypt has significantly improved since the government undertook a few bold measures starting in 2002, the year that Egypt opened its economy to the private sector, investments in Egypt have yet to reach their peak.
In an exclusive interview with The Daily Star Egypt, Ahmed Naim Badr, managing director of Naeem Holding, a free zone investment banking company in Egypt, expresses his viewpoint that while the government has succeeded in building an export-led, high-growth economy, one remaining factor prevents foreign direct investments (FDIs) from reaching their full capacity in the country.
"We should see more political transparency, says Badr. "There should be a clear political hierarchy. This is the only issue that could be worrying investors. It's not economic issues or reform issues.
What the country lacks is something that cannot be determined with a calculator.
It has become common knowledge that Egypt is trying to attract more FDIs, attempting to eat away from the Gulf's appealing FDI pie. Yet, as long as the country does not address the issue of political transparency, their efforts to lure some of the foreign currency injected in the Gulf will be wasted.
Badr is quick to point out that while political transparency remains a big threat to the success of investments in Egypt, in all other aspects, the government is doing a good job.
"To me, it's perfect the way things in Egypt are now. It's all about confidence, and I consider what has happened in Egypt since 2004 a pure boost in confidence. It's confidence boosted in people due to real figures and a cabinet which came and knew what they wanted to do with the economy and privatization, letting people inject more into the economy and invest cash in it, says Badr. "Reforms happened a year and a half ago. During that time, it was a case of building confidence. There was GAFI, but if there wasn't confidence, no one would have showed up. If they (the government) were not putting their money where their mouths were, they would have never gotten investors to come into this country.
"But things have changed. We have seen commitment, we have seen their interest to privatize and to really develop things on the right track, and that's why we are working closely with them on privatization, whereby on any transaction where there should be a privatization issue in place, we are there promoting it to our customers in the Middle East, explains Badr.
Naeem Holding, with a presence in Saudi Arabia and the U.A.E., has gotten into a few privatization deals since they came into the Egyptian market in 2005. The very first private placement that they took part in was Sidi Krir Petrochemicals Company (Sidpec), the sole producer of ethylene in the country. Currently, Naeem Holding owns 17 percent of Sidpec and sits on its board.
"Petrochemicals and energy is where we are looking to in the coming years. Why? Because at the end of the day we are coming from Saudi Arabia, where our background and experience is related to oil and gas, says Badr.
Naeem Holding is in fact a Saudi company. Initially founded as Naeem Financial Services in Saudi Arabia in 2003, the company operated as a pure asset management company from the date of its establishment until 2005, when Saudi Investment Bank (SIB) acquired 37 percent of the company. Following the acquisition, the company became known as Naeem Holding, and all its existing satellite activities in the Middle East were kept out of the merger. Due to this, Naeem Holding is the holding company for all the non-Saudi business of the company.
"The main bulk of cash is in Saudi Arabia, says Badr. "That's where the real liquidity is. The main source of assets to be bought (liquidity in Saudi Arabia is looking for assets to buy) is in the privatization program in Egypt. That's why we are open in Egypt, in order to find a way for this liquidity in the Middle East to come and invest in Egypt.
Currently, Naeem has $5 billion in assets under management in the region. This amount shifts from one country to another based on investment opportunities.
"Saudi Arabia is the main source of liquidity, Egypt is where we are looking for assets, Dubai is where we are directing our marketing and sales efforts, says Badr.
"Most of the Arab world is looking at Dubai now as the most strategic capital of the Arab world. Logistics-wise, it's much easier. But in terms of assets, there isn't much business to be done. There is no privatization, the liquidity is mainly coming from Saudi Arabia into Dubai, which is the final destination, where people would be buying assets from Egypt, states Badr.
"I think Egypt is the next financial hub once Dubai is saturated. Cost of operations in Dubai is very high and people will look for other centers where they can have their back up operations - Egypt should attract the back offices of multinational companies, adds Badr.
While Naeem is cashing out on the energy sector, it also has its eye on the real estate industry in Egypt. Currently, the company owns 60 percent of Coldwell Banker.
"There is a big boom in real estate in Saudi Arabia. There isn't a real estate company in the Middle East that has real estate investments and real estate developments, said Badr.
The company is also a major shareholder in several banks within Egypt. Currently they own 17 percent of Al Watani Bank of Egypt, 18 percent of Egyptian Gulf and are planning to buy 40 percent of a local bank.
The company has also worked on many initial public offerings (IPOs) through private placement, such as a $1.5 billion heavy crude oil refinery in Ain El Sokhna, the very first private sector refinery in the Middle East. They have also bought an advisory deal in a company called IT Work, and are raising the capital of Smart Village, of which they own 12 percent.


Clic here to read the story from its source.