Egypt’s current and future economy is on my mind – it’s been on my mind every day since Jan!  You see, I’m a small foreign investor here – would have been bigger investor if I had not fallen foul of some ex-government officials here!  And some still in government positions here!!!  The key word here is “investor” this means I brought my money into the country and hope for a return on it. –  so how’s that going for me?   Not so good I’m afraid.

Now since I use my blog to clear out my mind – once my thoughts are in writing they generally go out of my head so, I’m going to get the worrying thoughts out of my mind  – and into yours!  Nobody need make a comment here saying I am only thinking about myself because you are 100% right – when your back is to the wall you think about yourself – that’s how come there’s been a revolution here!

Before I go further I want to make it clear that I am not an economist, I have no qualifications or education in business, stock markets or the world economy at large!  These are simply the worrysome thoughts of a small foreign investor currently with all her eggs in one basket – that basket being Egypt!

Uncertainty is always bad for any economy and I think there are a few uncertainties currently standing in the way of foreign investment, indeed local investment in Egypt right now – they are

  1. Uncertainty about the status of existing companies and investments in Egypt.  Since there was one way of doing business in Egypt during the Mubarak era – how many existing business contracts/deals are going to be revoked/nullified?  What, if any monies are going to have to be returned to Egypt by investors?  Is there going to be a dramatic increase in the minimum wage?  Is Egypt going into a recession?
  2. Uncertainty about the election of the next President – When will it be?  Who will it be?  What will the exact powers of the next President be?
  3. Uncertainty about the next government – How will it be formed?  By the President?  By Elections?  If by elections – who will organise and oversee it?  When will it be?  Who will the next government be?  What powers will it have?  Will it be under the power of the President?  Will it be independent?  What will the policies be in regard to foreign investment, foreign loans, Israel, Iran, EU, USA, other Middle Eastern countries currently in revolt.  What parties are being formed in Egypt and what are their exact policies as regards security of investment, foreign policy, wage agreements, profit repatriation, taxes, tax incentives.
  4. Uncertainty about the revolution – Is it over?  Will there be more street protests?  Will there be destruction of property?
  5. Uncertainty about the Egyptian Army – what is it’s current role exactly?  Who is in control?  Is there unrest in the ranks of the Army?  What is the future role of the Egyptian Army?  Who is going to control the Army?  Who decides foreign policy – the President, the Government or the Army?
  6. Uncertainty about the available work force, qualifications, wage agreements, quality of education, level of training necessary, likelihood of strikes, sit-ins, closures if there are street protests etc.
  7. Uncertainty about the strength or weakness of the Egyptian Pound and trading on the stock market.  Is it safe to buy Egyptian Stock Shares?  Is it safe to buy Egyptian companies, Egyptian property? is it legal? – could they be later confiscated by the government?
  8. Uncertainty about the paperwork and legalities involved – again because of the way this was (and mostly was not) taken care of in the past.  The paperwork involved in setting up a business in Egypt, both for national and international investors has been a both a minefield and a nightmare over the last several years, in spite of the glowing promise of the One-Stop-Shop set up by Mubarak – I never heard of it working for anyone!  Will the systems be examined?  Will they be overhauled?  Can they be over-hauled?
  9. Uncertainty over the revision of the constitution, the question of Sharia Law and it’s place in the Egyptian Constitution – whether and how these issues will be resolved and the public reaction to any changes.  The thorny question of equal rights for women – uncertain.
  10. Last but by no means least is the uncertainty that exists in the absence of information – speaking for myself on this one – since I don’t read arabic my only source of news is whatever I find in English on the web or hear on TV.  So I am not saying nothing is happening here….I’m saying I’m not getting enough information on whatever steps anyone may be taking to answer any of the above uncertainties.

When I started to write this I didn’t realise I had so many valid uncertainties about the economy in my head…..there sure are a lot of uncertainties up there!  Any and all of the above, if not answered in the short term are very likely to lead Egypt into a long term economic recession. So, would you invest in Egypt right now?  Feel free to comment and be positive on any or all of the above as I said –  I’m not an expert.

Mara

Hi, I'm from Ireland and I built Mara House, a small, family run, unique boutique hotel in Luxor in 2003.....My promise is to deliver quality service, traditional food, comfort, enjoyable experiences, up-front pricing, no hidden extras.....PLUS I answer all your emails personally..... I provide professional, qualified tour guides who do NOT divert you to shops, restaurants etc. for commission.....We are best suited to people who like to be taken care of from airport entry to airport departure, people who want to avoid hassle, scams and tourist traps.....You deal directly with me and Mara House is NOT bookable via TripAdvisor nor any other online hotel website.Hope you find my travel info helpful -//.. Mara
Mara

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