INTERVIEW: JICA to invest up to $1 bln in Egypt through 2022: Regional director

Doaa A.Moneim , Thursday 8 Apr 2021

Matsunaga said that Egypt has been successful in dealing with the COVID-19 pandemic, and has been ranked first in Africa and third in the Middle East

Hideki Matsunaga
the regional director of the Japan International Cooperation Agency (JICA), Hideki Matsunaga during the online interview.

On Saturday, the Director General of Middle East and Europe Department of Japan International Cooperation Agency (JICA) Hideki Matsunaga arrived in Egypt for a one-week visit, his first official visit to the country.

Ahram Online sat down with Matsunaga in a virtual interview that discussed the main pillars of his visit and his insights on Egypt’s policy in coping with the COVID-19 pandemic and its associated challenges.

He also touched upon his vision regarding the new developments in the Egyptian Grand Museum (GEM), in which JICA is a key partner.

Matsunaga revealed to Ahram Online that JICA intends to invest up to $1 billion in the Egyptian market in 2021 and 2022, depending on the government’s priorities and the people’s needs.

Ahram Online: What are the main pillars of your first official visit to Egypt as JICA’s regional director?

Hideki Matsunaga: The main purpose of my visit is to strengthen the partnership between JICA and the Egyptian government. I would like to emphasise that the cooperation between JICA and the Government of Egypt is very strong and flourishing, where both nations are enjoying long lasting friendship, which further strengthened when President El-Sisi came to power.

The visits exchanged by the leaders of both countries have paved the way to the expansion of the portfolio of cooperation in recent years to include many areas, especially those related to human security such as health and education.

After assuming my new post as director general of the Middle East and Europe, I was very keen to visit Egypt and see the fruit of our cooperation and partnership in various fields. I participated in the sixth meeting of the steering committee of the Egypt-Japan education partnership with Minister of Education Tarek Shawki, Minister of Higher Education Khaled Abdel-Ghaffar and Minister of Social Solidarity Nevine El-Qabbaj.

In the meeting, we reviewed the progress of different ongoing projects under the partnership, including the Egypt-Japan Schools (EJS); the Human Resources Development and Scholarships Programs to Japan; the Egypt-Japan University for Science and Technology (E-JUST); Technical Education; and the Early Childhood Development projects.

With this great progress achieved on the ground, I expressed my appreciation for the strength of the partnership between the two countries in the education field.

I also witnessed the ceremony of the loan agreement signed last Sunday between JICA, Sumitomo Mitsui Banking Corporation (SMBC) and Banque Misr worth $100 million to support Micro, Small and Medium Enterprises (MSMEs) in Egypt, which is the First Private Sector Investment Finance (PSIF) cooperation for JICA in Egypt. The agreement aims at boosting the MSMEs' ability to lead Egypt’s economic growth by improving access to financing for MSMEs.

I also had fruitful discussions with the ministers of international cooperation and electricity and renewable energy on ways of strengthen our cooperation. I also attended the Japanese modernisation lecture at E-JUST, and visited many project sites including Borg El-Arab Airport and Egypt Japan School.

AO: What is the amount of the current cooperation portfolio with Egypt?

HM: JICA has several schemes of support extended to Egypt, including grants; technical cooperation, concessional loans, as well as the Japanese volunteers program and the TCTP program (South-South Cooperation), in which JICA is assisting the Egyptian government in transferring its expertise to the Nile Basin countries and the Middle East.

Japan is the third largest financer to Egypt according the data of Egypt’s Ministry of International Cooperation. The current ongoing cooperation portfolio between Egypt and JICA amounts to around $2.7 billion, which is quite huge.

This portfolio includes $287 million for investment in human capital through the Egypt-Japan partnership for education development; $1.12 billion for electricity; $552 million for transportation; $450 million for tourism and antiquities; $240 million for the financing of development policies and $57 million for irrigation.
We are also engaged in the agriculture sector, particularly the irrigation field, with about $50 million.

AO: What are JICA’s plans for Egypt?

HM: JICA’s policy and strategy of its operation in Egypt are totally consistent with the government of Egypt’s priorities and the Egyptian peoples’ needs. Our aim is to assist the development of Egypt, identifying three pillars of priority areas, chiefly the inclusive and sustainable growth that include the sectors of electricity, transportation, the private sector, tourism and cultural heritage, and poverty reduction and enhancing standards of of living, which comprises the sectors of irrigation and rural development, as well as basic social services.

In addition, we support human resources development that covers the sectors of education, public sector empowerment and South-South cooperation.

We focus on supporting quality infrastructure and human security and we follow a demand-driven approach where we try to respond to the needs of the Egyptian government.

AO: Is there a specific amount of investment that JICA intends to pump in the Egyptian market in 2021 through 2022?

HM: We plan to inject a total of $500 million up to $1 billion in investments. This amount could be changed, as it depends on the Egyptian government’s needs.
Thus, this amount could be more if the government wants. We are very flexible in this regard.

AO: As a partner in the Grand Egyptian Museum’s (GEM) construction, how do you see the developments in the GEM construction so far?

HM: The GEM will be a world class museum like other great museums in the US, London and Paris. It is really a magnificent project and it has witnessed rapid developments over the past few years.

I have paid a visit to the GEM and seen how the construction is close to 90 percent complete. We are proud to engage in such a project, and those who are leading the construction are doing a great job indeed.

AO: How do you see Egypt’s policy in dealing with COVID-19 and its associated challenges?

HM: COVID-19 is an unprecedented challenge to all countries globally. Egypt has been successful in dealing with the COVID-19 pandemic, and has been ranked first in Africa, third in the Middle East, and 25th globally in the COVID-19 resilience ranking issued by Bloomberg in November 2020.

Despite the COVID-19 pandemic and its repercussions on the world economy, the Egyptian economy showed resilience against the pandemic, and received praise by financial institutions and agencies around the world.

It also managed to be the only country in the MENA region to see a positive growth in 2020 despite the severe challenges.

The structural reforms Egypt has adopted since 2016, including the devaluation of the currency, the elimination of energy subsidies, the introduction of a value-added tax (VAT), and the government’s heavy investment in infrastructure projects, enabled Egypt to be one of the few economies worldwide able to deliver growth by year end.

Egypt’s EGP 100 billion COVID-19 emergency response packages have also supported the most affected sectors of the economy, such as tourism (irregular labour), aviation and healthcare, and supported the private sector (tax breaks). The Egyptian government was able to support its people to mitigate the impact of COVID-19 that resulted in many job and income losses.

Since the beginning of the COVID-19 outbreak in Egypt (in March 2020), JICA has quickly responded and provided support to the government of Egypt to fulfil its needs through a number of programs that target health system support, human resources development and private sector promotion.

AO: How do you see the investment and business climate in the Egyptian market?

HM: The legislative and structural reforms undertaken by the government of Egypt helped it improve the investment climate.

Egypt’s gradual increase in private sector investments and the enhancement of economic growth put Egypt on the world investment map.

The Egyptian government’s support for the investment climate included introducing amendments to the investment law, implementing the competition law, and reforming the industrial licensing system.

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