Egypt has a long and momentous history that has helped shape the world we know today. And while it is important to celebrate and learn from its past accomplishments, it is even more vital to be looking to the future to prepare to rise to the challenges of tomorrow.
President Abdel-Fattah Al-Sisi’s Vision 2030 for Egypt does just that. It is a long-term strategic plan to achieve sustainable economic development through diversification and innovation. To fulfil such a vision, it is necessary to purposefully plan and lay a foundation of reform to make Egypt’s economy more competitive and to attract greater investment.
With a population of over 100 million, Egypt faces the ever-present challenge of achieving impactful economic reforms domestically while continuing its rise and being competitive on the international stage. Its leadership has been wise to position Egypt as an increasingly attractive destination for foreign investment, leveraging the strengths of longstanding private-sector partners from around the globe, including a robust and growing number of American companies.
At the US Chamber’s US-Egypt Business Council, which was founded over 40 years ago by presidents Anwar Al-Sadat and Jimmy Carter to promote bilateral economic ties, we know that cultivating a strong private-sector ecosystem that lifts all tides will be key to Egypt’s continued success.
The council, together with our partner the American Chamber of Commerce in Egypt, has proudly stood with Egypt as a strategic partner in this mission for more than four decades. Today, the scope and breadth of the bilateral trade and investment relationship is substantial. US direct investment to Egypt exceeded $1.7 billion in 2019, with American companies working closely with their Egyptian partners across a diverse range of sectors, from healthcare, agriculture and food, and digital technologies, to logistics, infrastructure, transportation, and beyond.
Of course, there is more work to be done and more potential to be realised. The emergence of Covid-19 shocked every corner of the global economy and to varying degrees set us all back. And yet, Egypt achieved positive year-on-year GDP growth and was the only country in the region to do so in 2020, in addition to decreasing its national poverty rate for the first time in 20 years.
One area that has been particularly successful in both attracting significant investment by US companies and contributing more and more to Egypt’s economy is its energy sector. Here, the numbers continue to tell the story with oil and gas sector contributions making up 24 per cent of Egypt’s GDP during fiscal year 2019-20.
Notably, the fourth year of Egypt’s acclaimed conference showcasing the development and modernisation of its oil and gas sector, EGYPS 2020, attracted participation from over 20 American companies, several of which made major announcements to increase their footprint and activities in support of Egypt’s aspirations of becoming an energy hub.
These include an announcement by Bechtel to develop a refining and petrochemical complex with Egyptian partners and announcements by Chevron to provide trade and technical cooperation in the fields of refining, transportation, and distribution of petroleum products and crude oil, all in partnership with Egyptian companies.
To the credit of Egypt’s Ministry of Petroleum and Mineral Resources, the outcomes of EGYPS 2020 were met with much optimism. To take Egypt’s energy hub aspirations to the next level, we believe that it is vital to fully embrace the Ministry of Petroleum’s modernisation plan across every spectrum of the oil and gas industry.
Through this ambitious, multi-year agenda, Egypt is making commendable advancements to increase its petroleum resources, reduce operational costs, empower the Egyptian workforce, and optimise value-added downstream industries to align practices with sustainable development objectives. The combined success of these strategic activities is positioning Egypt’s oil and gas sector to become an economic growth engine for the future. American companies are not only paying attention to what Egypt is trying to build for the future, but they are also partners with Egypt in trying to build up the energy sector.
As Egypt’s largest US investor, Apache Corporation has 25 years of experience working closely with the ministry of petroleum and others in Egypt. Building on this partnership, Apache recently announced an agreement in principle with the Ministry of Petroleum and the Egyptian General Petroleum Corporation (EGPC) to help modernise Egypt’s petroleum sector by consolidating the majority of the company’s concessions in the Western Desert in order to improve virtually every facet of their operations.
The result? Through this next stage of partnership with Egypt, Apache will leverage new technologies, deploy sustainable practices, and bolster investments and production in Egypt. This renewed commitment to the country will help build local capacity and create new opportunities that benefit Egyptian communities and both of our economies.
It is also worth mentioning that beyond the dollars invested, American companies, like Apache, Bechtel and Chevron, bring global best practices and state-of-the-art technology as well as a track record of social investments to Egypt. And the jobs and economic growth their investments help create contribute to the stability of Egypt in a broader region that too often experiences turmoil and strife.
The US-Egypt Business Council applauds President Al-Sisi and the government of Egypt for the vision and tangible actions taken to modernise Egypt’s energy sector and encourages the Egyptian government to move forward with this effort.
And even more broadly, as President Al-Sisi and his cabinet continue to drive a reform agenda that welcomes investment and deeper collaborations, the US-Egypt Business Council and American companies will continue to partner and support Egypt’s economic diversification and growth, one investment at a time.
*Khush Choksy is senior vice president, Middle East, at the US Chamber of Commerce.
Steve Lutes is vice president and executive director at the US-Egypt Business Council.
*A version of this article appears in print in the 24 June, 2021 edition of Al-Ahram Weekly