Egypt needs to bolster economic reform to encourage private sector activity that will help drive investment, create jobs and increase growth, which is slowing amid high inflation, according to the Organisation for Economic Co-operation and Development.
The OECD's first survey of Egypt, in collaboration with government agencies, think tanks and academics, was launched on Friday as a comprehensive road map for the cash-strapped country’s emergence from its worst economic crisis.
The report's recommendations included reducing public spending, tackling rampant corruption, streamlining procedures for the formation of new businesses and restoring lost investor confidence.
Record high inflation has caused a widespread cost of living crisis in Egypt where rampant shortages of essential goods, including medicines, have been worsening since the start of the year.
“Bringing inflation under control is now a key near-term priority to spur consumption and strengthen growth. Monetary policy needs to remain restrictive until inflation comes back to target,” OECD Secretary General Mathias Cormann said while presenting the survey alongside Minister of Planning and Economic Development Dr Hala El Said.
Egypt's economy is contracting due to the record inflation which has driven down consumption, the OECD survey explained.
This month, Egypt's central bank raised its overnight interest rates by 200 basis points, a move some analysts said might indicate a currency devaluation is on the way. The lending rate was raised to 22.25 per cent and the deposit rate to 21.25 per cent
Restrictive monetary policy, while highlighted in the survey as an effective way of bringing down inflation, has also resulted in a weak investment climate.
“The recovery of investment is set to be subdued as financing conditions will remain tight for some time,” the survey noted.
Massive capital outflows in early 2022, an economic repercussion of the Russia-Ukraine war, caused a foreign currency crunch that has crippled much of the country’s import-reliant industries and driven up unemployment.
The crunch has, in turn, led to repeated devaluations of the Egyptian pound – which has lost more than 50 per cent of its value since March 2022 – in unsuccessful bids by the government to increase foreign investment, which remains weak, the survey said.
“A comprehensive consolidation strategy is needed to improve investor confidence in public finances and ease financing conditions,” Mr Cormann said.
Egypt’s exports, another vital source of foreign currency, fell by 22 per cent year-on-year during the first nine months of 2023.
They were then hit hard by Houthi attacks in the Red Sea in response to Israel’s war on Gaza, with traffic through the Suez Canal halving in January, according to the waterway's authority.
“Exports are expected to regain momentum if the disruptions to tourism and Suez Canal traffic end,” the survey predicted.
However, the OECD conceded that the situation is far too volatile to predict and that the “risks surrounding this outlook are substantial and skewed to the downside”.
“They include, among others, further losses in investor confidence, which would result in further depreciation and deeper foreign currency shortages, and lead to additional tightening in financing conditions.”
One of the main obstacles to economic prosperity in Egypt remains public spending, according to the survey, which recommended halting national construction projects, especially ones that don’t have immediate economic benefits, in addition to maintaining social support and cash transfers to the country’s poorest.
The survey also highlighted increasing public debt, which is expected to reach 92 per cent of gross domestic product at the end of the current fiscal year.
High external debt will inevitably widen Egypt’s budget deficit, one of the main reasons investors have stayed away from its markets since 2022, according to the survey, which recommended additional scrutiny of public investment programmes to ensure efficiency.
It also stated that the “domineering presence of state-owned enterprises has hindered private sector activity and investment. It has reduced business dynamism, reflected in low firm entry and low efficiency of resource allocation.”
The withdrawal of state-owned companies from the country’s economy to make way for a private sector participation of 65 per cent by 2030 was highlighted by Ms El Said, during her address on Friday, as a cornerstone of the government’s plan for the economy.
Ms El Said explained that due to political instability between 2011 and 2014, the state had to step in to build infrastructure, boost foreign investment and ensure citizens were fed and employed.
“Then we started in 2021 launching with the private sector what is needed from the state. The state has to exit and give more of a role to the private sector,” she said.
The survey also noted the growing role of the Egyptian military in the economy and their operations, which are entirely unchecked by the public.
“Ownership and management selection processes in Egypt’s state-owned enterprises lack transparency. This is particularly the case for military-owned firms that are outside the competence of the 2006 Corporate Governance Code.
“Opaqueness of public ownership undermines the activity of private firms, because it harms the confidence of business owners and investors,” the survey added.
To boost the private sector and ensure that more Egyptians choose to work in the country’s formal employment sector, the government must also lower labour taxation which boosts the casual sector where citizens aren’t forced to split their earnings with the state, the OECD recommended.
Rampant corruption and procedural hurdles that continue to prevent more Egyptians from starting businesses and participating in the economy need to be removed, it advised.
A more serious implementation of climate change adaptation and mitigation policies was also recommended, as Egypt faces rapid desertification of its arable lands and water scarcity.
The survey projected Egypt's GDP [gross domestic product] growth to ease to 3.2 per cent in the 2023-24 fiscal year, before increasing gradually to 5.1 per cent by 2025-26, provided the country follows the proposed guidelines.
UAE currency: the story behind the money in your pockets
What sanctions would be reimposed?
Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:
- An arms embargo
- A ban on uranium enrichment and reprocessing
- A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
- A targeted global asset freeze and travel ban on Iranian individuals and entities
- Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods
HIJRA
Starring: Lamar Faden, Khairiah Nathmy, Nawaf Al-Dhufairy
Director: Shahad Ameen
Rating: 3/5
The Settlers
Director: Louis Theroux
Starring: Daniella Weiss, Ari Abramowitz
Rating: 5/5
Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
The White Lotus: Season three
Creator: Mike White
Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
MOUNTAINHEAD REVIEW
Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
The%20specs
%3Cp%3E%3Cstrong%3EEngine%3A%20%3C%2Fstrong%3E2.3-litre%204cyl%20turbo%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E299hp%20at%205%2C500rpm%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E420Nm%20at%202%2C750rpm%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3E10-speed%20auto%0D%3Cbr%3E%3Cstrong%3EFuel%20consumption%3A%20%3C%2Fstrong%3E12.4L%2F100km%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3ENow%0D%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh157%2C395%20(XLS)%3B%20Dh199%2C395%20(Limited)%3C%2Fp%3E%0A
AI traffic lights to ease congestion at seven points to Sheikh Zayed bin Sultan Street
The seven points are:
Shakhbout bin Sultan Street
Dhafeer Street
Hadbat Al Ghubainah Street (outbound)
Salama bint Butti Street
Al Dhafra Street
Rabdan Street
Umm Yifina Street exit (inbound)
In 2018, the ICRC received 27,756 trace requests in the Middle East alone. The global total was 45,507.
There are 139,018 global trace requests that have not been resolved yet, 55,672 of these are in the Middle East region.
More than 540,000 individuals approached the ICRC in the Middle East asking to be reunited with missing loved ones in 2018.
The total figure for the entire world was 654,000 in 2018.
THE LOWDOWN
Romeo Akbar Walter
Rating: 2/5 stars
Produced by: Dharma Productions, Azure Entertainment
Directed by: Robby Grewal
Cast: John Abraham, Mouni Roy, Jackie Shroff and Sikandar Kher
The specs: 2018 Mercedes-Benz S 450
Price, base / as tested Dh525,000 / Dh559,000
Engine: 3.0L V6 biturbo
Transmission: Nine-speed automatic
Power: 369hp at 5,500rpm
Torque: 500Nm at 1,800rpm
Fuel economy, combined: 8.0L / 100km
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
Company%C2%A0profile
%3Cp%3E%3Cstrong%3ECompany%20name%3A%20%3C%2Fstrong%3ETuhoon%0D%3Cbr%3E%3Cstrong%3EYear%20started%3A%20%3C%2Fstrong%3EJune%202021%0D%3Cbr%3E%3Cstrong%3ECo-founders%3A%20%3C%2Fstrong%3EFares%20Ghandour%2C%20Dr%20Naif%20Almutawa%2C%20Aymane%20Sennoussi%0D%3Cbr%3E%3Cstrong%3EBased%3A%20%3C%2Fstrong%3ERiyadh%0D%3Cbr%3E%3Cstrong%3ESector%3A%20%3C%2Fstrong%3Ehealth%20care%0D%3Cbr%3E%3Cstrong%3ESize%3A%20%3C%2Fstrong%3E15%20employees%2C%20%24250%2C000%20in%20revenue%0D%3Cbr%3EI%3Cstrong%3Envestment%20stage%3A%20s%3C%2Fstrong%3Eeed%0D%3Cbr%3E%3Cstrong%3EInvestors%3A%20%3C%2Fstrong%3EWamda%20Capital%2C%20Nuwa%20Capital%2C%20angel%20investors%3C%2Fp%3E%0A
The biog
Name: Sarah Al Senaani
Age: 35
Martial status: Married with three children - aged 8, 6 and 2
Education: Masters of arts in cultural communication and tourism
Favourite movie: Captain Corelli’s Mandolin
Favourite hobbies: Art and horseback ridding
Occupation: Communication specialist at a government agency and the owner of Atelier
Favourite cuisine: Definitely Emirati - harees is my favourite dish
The specs: 2017 Ford F-150 Raptor
Price, base / as tested Dh220,000 / Dh320,000
Engine 3.5L V6
Transmission 10-speed automatic
Power 421hp @ 6,000rpm
Torque 678Nm @ 3,750rpm
Fuel economy, combined 14.1L / 100km
What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
Killing of Qassem Suleimani
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
RESULT
Brazil 2 Croatia 0
Brazil: Neymar (69'), Firmino (90' 3)
Seemar’s top six for the Dubai World Cup Carnival:
1. Reynaldothewizard
2. North America
3. Raven’s Corner
4. Hawkesbury
5. New Maharajah
6. Secret Ambition
Smart words at Make Smart Cool
Make Smart Cool is not your usual festival. Dubbed “edutainment” by organisers Najahi Events, Make Smart Cool aims to inspire its youthful target audience through a mix of interactive presentation by social media influencers and a concert finale featuring Example with DJ Wire. Here are some of the speakers sharing their inspiration and experiences on the night.
Prince Ea
With his social media videos accumulating more half a billion views, the American motivational speaker is hot on the college circuit in the US, with talks that focus on the many ways to generate passion and motivation when it comes to learning.
Khalid Al Ameri
The Emirati columnist and presenter is much loved by local youth, with writings and presentations about education, entrepreneurship and family balance. His lectures on career and personal development are sought after by the education and business sector.
Ben Ouattara
Born to an Ivorian father and German mother, the Dubai-based fitness instructor and motivational speaker is all about conquering fears and insecurities. His talk focuses on the need to gain emotional and physical fitness when facing life’s challenges. As well managing his film production company, Ouattara is one of the official ambassadors of Dubai Expo2020.
Killing of Qassem Suleimani
Killing of Qassem Suleimani
