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Legal environment, lack of transparency challenge economy: UNB board director
Published in Daily News Egypt on 26 - 11 - 2014

Daily News Egypt has interviewed the director of the Union National Bank (UNB) Mohamed Nassar Abdeen on his views about the economy and how he perceives the economic future of Egypt
What is the UNB Group's perception of the Egyptian economy in the next period?
We perceive the Egyptian economy to be one of those economies which has a promising future for growth and development – however this requires planning, setting priorities and creating opportunities for growth through improving infrastructure and providing support to the sectors which cater to the largest segments of the Egyptian population.
What are, in your view, the challenges facing the Egyptian economy?
There is no doubt that the Egyptian economy faces challenges relating to the negative effect of terrorism on diverting development efforts, which resulted in reluctance of some willing investors and to enter the Egyptian market . We perceive the legal environment, lack of transparency in dealing with investors and in preserving their rights due to delays in legal proceedings, as representing challenges which need to be addressed. In our view, the main challenge, which was not addressed by previous governments, is an absence of a clear vision and clearly defined strategies for development, which the state should adhere to regardless of any change in government executives.
Does the UNB Group still perceive the Egyptian economy as attractive for new investment?
The Egyptian economy is one of the most promising economies in the world with opportunities for new, diversified and sizeable investments, as there is definitely a need for growth and development in all economic sectors, with no exception. However, there should be a clear understanding of the requirements and available opportunities in these sectors. The concerned ministries and departments should also provide information to investors to which will allow them to make informed investment decisions.
Do you have plans for entering into new investments in the Egyptian market?
I have pointed out in previous interviews that Union National Bank-Egypt has entered the Egyptian market based on a clear vision and in-depth feasibility assessment, which concluded with the conviction that Egypt will be heading towards an economic development course which will strengthen its leadership position in this region and in the world. We have put this vision into practice by doubling the bank's capital, which increased by 100% during the last few months, in addition to our continued policy of opening new branches. This trend has not stopped or slowed down, even during the last few years which witnessed the revolutions of January 2011 and June 2013. Our vision has been commended by published reports which indicated that the bank is one of the most dedicated banks providing support to the growth of the Egyptian economy, despite the banks relatively recent entry into the Egyptian market, and its being a leading bank which continues to provide excellent services to its customers in various sectors.
What are the perceived obstacles which need to be tackled in order to attract new investments?
In responding to your second question, we have clarified that laws and the legal environment require some revision which will ensure that rights are protected and disputes are resolved within a reasonable period of time. The government should have a clear vision, implement specific plans, and provide relevant information to investors. In addition, the government should undertake improvements in infrastructure and define the relationships more clearly between stakeholders in the economic process. It should also improve the regulatory environment in a way which facilitates and improves the contribution of human resources, through the appropriate reward system, which will certainly reflect positively on the perception of work-reward relationship, value of work, and the importance of improving productivity.
What is your assessment of the performance of the Egyptian economy during the current year, and are there indicators to an improvement in economic performance?
There is no doubt that there is tangible improvement in the performance of the Egyptian economy, which was triggered by starting immediate implementation of national projects.
This approach has been met with appreciation and support domestically and internationally, as it indicates improvement in economic performance. It is coupled with a restored confidence of the Egyptian people towards its leadership, and their respect of all the leadership's decisions, which undoubtedly has given more attention to the requirements of the large segments in Egyptian society, without compromising on the important role played by Cairo in Egypt's current and future development path.
Do you think that the economic reforms enacted by the government represented by changes in the subsidies structure and reducing expenditures shall have a positive impact on economic performance in the near future?
Certainly, we believe that the economic reforms implemented by the current government will have positive implications which will result in substantial gains in the future. We appreciate and respect the current leadership's insistence on taking decisions at the right time, while previous governments have disregarded national interests and the well-being of future generations, through their avoidance for decades to take such decisions, in fear of any possible reaction this may create.How do you perceive the national projects initiated by the government and their effect on economic performance?
Certainly, Egypt was in need of serious national projects in order to revive the economy and to restore the people's confidence in the intensions of the ruling regime. This has materialised, as indicated by the unprecedented response to the president's call for starting the expansion of the new Suez canal project, using Egyptian hands, and with Egyptian capital .This in my view is an epical incidence which has been recorded in history which will bring back the Egyptians some of their past glories, this will motivate them to work more and excel, after having suffered for many years under previous regimes.
What are your comments relating to the Suez Canal subscription, and how do you perceive the bank's performance in this respect?
As I have mentioned, the subscription in the new Suez Canal project will certainly remain a source of pride for Egypt and the Egyptians. In this regard, the banks have undertaken their responsibilities and supported the subscription in a satisfactory manner. This increased confidence in the Egyptian banking system which allowed banks to have sufficient liquidity to meet the huge demand that resulted in withdrawal of billions of pounds from some banks.
Do you support the government's inclination to repeat the Suez Canal subscription method foe new national projects?
I am confident that the Egyptian leadership is racing against time, working in all economic spheres and in all directions, and I know that the previous legacy is much worse than some of us believe it to be. The obstacles which the terrorist groups, the parties funding them and their supporters inside and outside the country, try to create in an attempt to stop the course of development, only add to the burden. However, I have trust in the Egyptian people's conscious/awareness, which emerges during difficult times as long as they have trust in their relationship. I have no doubt that the epical response to the Suez Canal project could be repeated with every national project that will give hope in a better future for the Egyptian people.
What is your perception of the effect of the small enterprises on growth of Egyptian Economy and creating new employment opportunities?
In the past, small businesses were not encouraged, which I believe was one of the main reasons behind the marginalisation of the middle class in Egypt. This created a huge gap in the social and economic structure of the Egyptian economy. But this is now changing, as priority and more support are provided to small enterprises in order to establish a large economic base through which this sector could contribute to economic development and create numerous new employment opportunities.
What do you think is required in order to increase activities of small enterprises in different economic sectors?
The responsibility for this lies with the proper understanding of the banking industry of the importance and the role of these enterprises in economic development, and in providing them with required finance based on accurate estimation of project feasibility.


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