Egyptian Economic Performance (5/6/2007) A.      Increase in Egyptian Exports to the Arab countries The Minister for Trade and Industry announced that Egyptian exports to the Arab countries increased by 80% since implementing the FTA in 2005 which shows that inter-trade between Arab countries during the last couple of years has doubled. It is worth mentioning that the recent report issued by the Information and Decision Making Support Center of the cabinet pointed to the increase in the value of Egyptian exports to the Arab countries in the last year to reach 2.2 billion dollar in comparison to 479 million dollars in 1995. The trade exchange between Egypt and the Arab countries amounted to around 6.2 billion dollars in 2006 compared to 2.1 billion dollar in 2000. The report shows furthermore that 7 Arab countries represented 76.6% of the total Egyptian exports to the Arab countries in the year 2006 namely: Saudi Arabia, United Arab Emirates, Syria, Jordan, Lebanon, Sudan, and Libya.   Visit of the Minister of Investment to Greece The Minister of Investment visited Greece on the first and second of June to take part in the conference organized by the International Finance Institute that included several financial officials as well as ministers and officials from Greece, Turkey, Korea, Poland, Romania and Bulgaria. The Minister of Finance explained in his statement the economic trends in Egypt and the investment opportunities and policies undertaken to improve the investment climate as well as the measures undertaken by the Egyptian government to attract FDI stressing that Egypt enjoys a number of investment advantages including tax and customs reductions. The Minister of Investment held several meetings with investment officials in Greece including the head of the Athens Stock exchange as well as the vice ministers of economy and development in addition to a number of meetings with companies and banks' representatives especially in the fields of maritime transport , energy, food industries and cement. The Minister of Investment stressed that he sensed during these meetings a great readiness for economic and investment cooperation with Egypt which was reflected in the Greek investments in Egypt in a number of fields especially financial and banking services. He further explained that Greek investors possess showed great interest in establishing a maritime line between Greek and Egyptian ports to transport passengers and cargo.   Improving Weaving And Textile Sector In Egypt: The Minister of Trade And Industry announced that a number of measures will be adopted to improve weaving and textile industry and overcome customs trafficking. A working group, composed of representatives from Ministry of Trade And Industry, Egyptian Industries Union and commercial chambers, to set the tools to enhance the weaving and textile industries as well as benefit from governmental aids directed to developing this sector. The minister asked the ministry agencies and the other supervising agencies to cooperate with the trade representative offices and to trace the source of the forged bills in addition to taking the necessary legal measures. The director of the Egyptian Industries Union corroborated the danger of customs trafficking on this sector as well as its negative impact on its competence capabilities. He added that the Union is studying the possibility of forming a working team to combat trafficking. Worth mentioning, the Egyptian clothing and textile exports augmented by 21.9% during the first quarter of 2007. Within the framework of QIZ ,the clothing and textile industry also increased during the same period by 50.3% compared to last year results.   The "Sixth Development Plan" aims at reducing unemployment rates by 5%: The Sixth Development plan from 2007-2012 aims at raising the standard of living of the Egyptians by 35%, boosting the average of income in Egypt to 13 thousand Egyptian pounds annually, employing 3.8 million citizens to reduce the unemployment by 5%. The major obstacle confronting the implementation of this plan is reaching a balance between the increasing population rate, the availability of resources and reforming the economy. The plan also concentrates on improving the quality of the services (as education or health) provided to the citizen.   E.     Seminar on The Strategic Egyptian Italian  Partnership       1.    The Seminar on The Strategic Egyptian Italian Partnership was held on May 26th, discussing the 4 pillars of the strategy which are as follows: ·     The industrial cooperation between the two countries aiming at making Italy, Egypt's 1st industrial partner, and within this framework there is a plan to establish the joint Egyptian Italian industrial zone. ·     Technology transfer, through the establishment of joint technological centers (7 of which have already been established in different sectors including weaving, ready-made garments, marble, plastic, leather products and food projects). ·     Technical and professional training for the aim of raising productivity of Egyptian labor ( 7000 Egyptian workers are currently being trained according to this program) ·     Providing the financial mechanism necessary for implementing the previously mentioned 3 pillars( an agreement on a new financial mechanism of 400 million EGP has recently being signed)       2.    During the seminar, the Minister of Investment has presented the major developments in the business climate as follows: ·     The government is currently adopting the public private partnership policy to promote investment especially in Upper Egypt. ·     The amendment of the Investment Law, would allow establishment of new private investment zones according to the one-stop-shop system. ·     A declaration has been issued for the establishment of agricultural development authority to be responsible for offering land to investors       3.    On the other hand, it was pointed out at the increasing trend of Italian investment in Egypt, that is to say there are 407 companies in Egypt of Italian investments in fields of tourism, communication and information technology, services, industry and contracting as well as agricultural projects.   F.       Development in The Energy sector I- The First Egyptian Chinese Plant to Manufacture Oil Rigs in Suez    1-  the first plant for manufacturing onshore oil rigs in Egypt and the Middle East is currently being implemented with a joint Egyptian – Chinese investments of about $30 million in Suez at the development industrial zone north – west Gulf of Suez.    2-  It is worth mentioning that the oil rigs plant will pave the way for the Egyptian shareholders of the project to benefit from the distinguished expertise as well as the great technological potentials of the Chinese Corporation, HH.    3-  The new Plant will contribute to providing the needs of the Petroleum Sector's companies and fill the shortage in onshore rigs that experience a growing demand in light of intensifying oil and gas exploration operations. The plant will also contribute to providing more than 500 direct and indirect job opportunities for Suez citizens. Moreover, it is planned to expand in manufacturing drilling rigs, wells maintenance, rigs overhaul in the Arab region and North Africa.    4-  The plant location was chosen and allocated in the industrial development area in Suez at an area of about 84 thousand m² for its proximity to the ports of El Ein El Sokhna, Adabeya and main highways. It is expected that the first fruit of the plant is 3 drilling rigs at the end of this year and production capacity will be expanded gradually according to the working program to reach 15 rigs in 2010. II- New Agreements for Gold and Minerals Crudes exploration      1-    After the success of the 1st International Bid-Round for gold exploration in Egypt, which was offered in July 2006 and resulted in signing 6 agreements with international companies to explore and produce gold, the Egyptian Mineral Resources Association (EMRA) is currently finishing the procedures of offering new gold exploitation and mineral resources Bid-Rounds.    2- The reports of the Egyptian Mineral Resources Association clarified that the expected gold production next year will be about 8 tons which is greater than what had been produced allover the 20th century.