4th annual event marked by absence of Nazif, economic cabinet CAIRO: Two months after the World Bank ranked Egypt 165 on its list of 175 countries in its annual Ease of Doing Business report, the ranking is still casting a dark shadow over discussions at the Egypt Invest 2006 conference. The fourth annual investment and trade promotion conference was also dampened by the absence of Prime Minister Ahmed Nazif, who was in a meeting reviewing the upcoming union, and his economic cabinet. The ministers of Trade, Investment and Finance, is accompanying President Hosni Mubarak on his trips to Russia, China and Kazakhstan. There were some bright spots at the meeting, however. This week s IMF report ranked Egypt first among emerging countries in Asia and the Middle East with the potential to witness strong economic growth in 2007. The IMF predicted that Egypt s economy would achieve seven percent growth next year because of increased exports, especially in the natural gas sector. Despite this good news, investors and government officials debated the accuracy of the World Bank report and how to address the problems it raised. The World Bank report calculated its rankings by rating 10 areas of business in each economy under study. These areas included starting a business, obtaining licenses, employing workers and obtaining credit. According to the report, Egypt scored the lowest in licensing and access to credit. Joseph Ryan, United States Agency for International Development (USAID) Director, said the issues raised by the report point to existing problems and the government s attempts to deal with them, but does not address further efforts now underway. Even major factories in Egypt never get an operating license and end up operating in the gray economy, said Ryan. But in terms of overall ease of doing business, there s no reason why Egypt can t move ahead in the future. The most pressing issue, Ryan said, is improving the country s education system. None of Egypt s universities reached the top 500 list in last year s Shanghai Jiaotong University rankings. But Ahmed Zaghloul, AztraZeneca Egypt President and himself a graduate of an Egyptian university, says the recent spread of foreign private universities has helped raise the standards of higher education. I think we re starting to see some of the foreign private universities such as the German and American universities produce high caliber graduates and I think this will eventually drag some of the older universities to upgrade their systems, Zaghloul told The Daily Star Egypt. In defense of the government track record on foreign investment, Ziad Bahaeddin, Chairman of the General Authority for Investment and Trade Zones (GAFI), said reports can help measure progress but are not to be relied upon entirely. He added the government s current efforts are being directed to address the deficiencies cited, most importantly decentralizing the licensing process and implementing World Bank s recommended reforms in the financial sector to improve the private sector s access to credit. It takes time to dig into rules and policies that have been put in place over the years, said Bahaeddin. There are certain obstacles to investment but its an issue not for the government alone, it s a matter of national importance. Each of us has a role to play.
