U.S. companies eye Egypt for investment
Egyptian President Mohamed Morsi meets with IMF chief Christine Lagarde in Cairo
September 5th, 2012
12:01 AM ET

U.S. companies eye Egypt for investment

By Jill Dougherty

More than 100 senior executives from dozens of U.S. companies, representing finance, energy, technology and other firms, will travel to Egypt on Saturday as part of the largest-ever trade delegation to the region.

Organized by the Chamber of Commerce through its U.S.-Egypt Business Council, the mission's primary aim is to promote private-sector development and to scout for opportunities and partnerships.

But the delegation will also express U.S. business confidence in Egypt and demonstrate a commitment to the country's long-term economic development.

It will be led by Lionel Johnson, the chamber's vice president of Turkey, Middle East, and North Africa affairs, and Steve Farris, chief executive of Apache Corporation, a private Fortune 200 company with more than $10 billion in investments in Egypt.

Others in the delegation of more than 50 companies heading to Cairo include Cisco, Citibank, Coca-Cola, General Electric, Microsoft and ExxonMobil.

In a sign of Obama administration support, Deputy Secretary of State Thomas Nides will join the trip.

The administration's focus has been on U.S. economic assistance to Egypt. But it is close to agreement with the new government of President Mohammed Morsy to relieve $1 billion of debt.

Egypt also is discussing a $4.8 billion credit with the International Monetary Fund, which the Obama administration supports, as well as other financing and loan guarantees.

The State Department has a dual-track approach.

When Secretary of State Hillary Clinton visited Egypt in July, top Egyptian officials pointed to broad-based economic growth and job creation as top priorities.

Egypt's economy has major challenges but it is not running out of money. According to the IMF, it has $14 billion in international reserves although that is down from more than $36 billion at the end of 2010.

It needs help with its budget deficit, giving the new government room to address more immediate problems like job creation, support for enterprises, education, economic reform and help for regions that have lagged behind.

These are the things that Egyptians fought for in their Arab Spring uprising 18 months ago.

Egypt is hugely influential in the region and progress for its people could be a potent message for other Arab Spring countries whose people question what benefit their popular uprisings brought them.

"We want our assistance to be on many levels, and in many areas," Robert Hormats, the Under Secretary of State for Economic Growth, Energy, and the Environment, told CNN.

Hormats, who led a delegation of senior U.S. economic officials to Cairo in late August, said in a speech to the American Chamber of Commerce in Egypt that President Morsy "has indicated his desire to adopt a serious and impressive economic reform agenda."

"With a president, a prime minister, and a Cabinet ready to engage, now is the moment for Egypt and the United States – and indeed the wider international community as well - to work together with renewed commitment and energy on several levels and in several ways," Hormats said.

Improving the country's business climate is one of the key ways to encourage domestic and foreign investment, he said.

"Doing so through such steps as regulatory reform, and maintaining an open and stable investment climate, can over the course of the next several years bring far more resources, and far more new technologies to Egypt than foreign loans or foreign assistance could bring. We plan to help on all these fronts."

Human rights groups welcome news that the Obama administration is close to completing the debt relief deal.

Human Rights First's Neil Hicks said that "a prosperous, peaceful, democratic Egypt would be an important ally for the United States in a troubled region."

"Support for much needed economic assistance to the Egyptian government will better enable U.S. policy makers to encourage Egypt's leaders to move forward with essential political reforms and vital measures that protect basic rights and freedoms for all Egyptians," he said.

Asked why it has taken so long to craft a debt package, acting Deputy State Department spokesman Patrick Ventrell told reporters on Tuesday that Egyptians "have gone through what has been a number of months of significant change" that included elections and a new president.

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