Egyptian Economic Performance (7/2/2007) A.      Visit by Secretary-General of the United Nations Conference on Trade and Development(UNCTAD): 1.      The Secretary-General of the United Nations Conference on Trade and Development, Mr. Supachai Panitchpakdi, visited Egypt in the first week of February. During this visit, he met with H.E. the Foreign Minister, who praised the role of the UNCTAD in providing technical assistance to developing countries in a number of fields, namely trade, investment and macroeconomic policies, as well as financing development. 2.      Following the meeting H.E. the Foreign Minister and the Secretary-General of the UNCTAD signed a Memorandum of Understanding (MoU) between the Diplomatic Institute and the UNCTAD secretariat to strengthen cooperation between the two sides in the fields of training and capacity building. 3.      During his visit, Mr. Panitchapakdi met with H.E. the Prime Minister and the ministers of investment, higher education and scientific research, finance, international cooperation, as well as the Secretary-General of the Arab League. 4.      The Secretary General of the UNCTAD attended the opening ceremony of a training course for African countries organized by the UNCTAD in the Diplomatic Institute. The course will focus on major issues on the international economic agenda, as well as ties between trade, investment and development. B.     Trade Balance Deficit falls 36% in the first quarter of the fiscal year 2006-2007 1.      A study conducted by the International Trade Point (The Ministry of Trade and Industry) reports a fall of 36% in the trade balance deficit during the first quarter of the fiscal year 2006-2007. 2.      Dr. Hussein Omran the director of the Trade point explained that the improvement in the trade balance has been the result of an increase in exports by 23% that reached 18.8 billion pounds compared to only 15.3 billion in the same period of the previous fiscal year, while imports decreased by 5% compared to 30% during the same period the previous year. 3.      He added that the non-petroleum exports recorded an increase of 31%, namely exports of semi-produced goods grew by 39%, raw materials by 27% and finished goods by 29%, while exports of the Free Zone grew by 29% and petroleum exports grew by 17% to reach 10.3 billion pounds compared with 8.8 billion pounds in the same period of the previous fiscal year due to an increase in the prices of oil. 4.      The study further shows that our exports to the british market marked a significant increase to reach 2.443 billion pounds compared to 690  million in the same period of the previous year. C.     The Minister of Investment meets with a delegation of Korean companies: 1.      Dr. Mahmoud Mohieldin the minister of investment met January 27th a delegation from major Korean companies interested in investing in Egypt. Economic reform of taxes, customs and establishing companies were discussed, as well as the fields of investment open to the Korean investors and the current business climate and the opportunities it presents. 2.      The meeting was attended by South Korean Ambassador to Cairo, officials of the Ministry of Investment and the General Authority for Investment and Free Zones (GAFI). 3.      The Korean delegation has expressed its interest in investing in Egypt which is a promising market, with natural resources and commands an important geographical and political position. Korean technical experiences were discussed at the meeting. 4.      The Korean delegates expressed their interest in coordinating with the Egyptian side to publishing a book about Egypt’s investment climate and the existing institutional and legislative structure. The book will be given to Korean businessmen for them to appreciate the investment opportunities available in various sectors. D.     The Energy Sector: The Minister of Petroleum, Eng. Sameh Fahmi, announced the discovery of a new natural gas well in the Mediterranean, at a sub-sea water depth of 668 meter, located at about 56 km north Alexandria. The new discovery's reserves are estimated with more than one trillion cubic feet, which are equal to 9 months consumption of natural gas. The Minister of Petroleum witnessed the signing of a cooperation agreement between the International Financing Institution, one of the institutions of the World Bank and the Egyptian Mineral Resources Authority ( EMRA ) to develop and bolster the activity of mineral resources in Egypt in cooperation with the Egyptian Mineral Resources Authority and the Mineral Resources Scientists Council. The agreement was signed by Dr. Hussein Hamoudah , EMRA’s Chairman, and Mr. Gerliz Hudah Regional Manager of the International Financing Institution. The agreement aims at contributing to setting up of a new mining law that helps in attracting more investments in the field of mineral resources as well as the establishment of an information center for mineral resources that includes  mining information and geological maps, as well as contributing to the restructure of the Mineral Resources Sector. The minister of Petroleum stressed the importance of cooperating with the World Bank to benefit from the international expertise in the field of mineral resources and to inform the international institutions of the new economic measures taken to attract investments and the developments in the mining policies in Egypt. Tourism:   Tourist arrivals to Egypt grew by 5.5% in 2006 to 9.08 million tourists. The number was boosted by a 15.6% growth in arrivals in the last quarter of the year. Some 15% of all tourists arrived from the UK, making it the biggest source of tourists to Egypt in 2006. Russia, with 11% of total arrivals, was next, followed by Germany, with 10.6%. Italy’s share fell to 8.7% from 9.6% in 2005. Tourists spent a total $7.6 billion in 2006, up 11.9% from 2005. It is believed that the increase in spending by tourists was due in part to the growth of higher spending tourists such as Saudis, who increased by 8% from last year. Egypt hosts the forum on Debt management in emerging countries: Dr. Boutros Ghali, the minister of Finance and Mr. Marlo Bertgal, deputy president of the World Bank will inaugurate February 8th the annual forum for mangers of the general debt in emerging countries with the participation of 24 countries and a number of investment banks, international insurance companies, portfolio management and retirement funds companies. This is the first time for the forum to be held outside the United States and is attended by a number of experts in the International Monetary Fund, headed by Dr. Abdel Shakour Shaalan, the executive director of the fund. The minister of Finance stressed that the Egyptian side will explain Egypt's experience with general debt and the measures taken to manage the local debt in Egypt in the last 2 years, for example how to issue governmental stocks by selling and rebuying those stocks to raise the effectiveness of general debt management. The Forum will also discuss the experiences of other countries in the same field to benefit from them. The minister of Finance further explained that a number of measures will be taken to provide more liquidity in the governmental stock market in order to lower the cost of the local debt.