| 13 Dec 2009 |
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FDI to reach $10 bln says Mohieldin
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Foreign direct investment in Egypt will reach its $10 billion target for fiscal year 2009/10, Reuters quoted Minister of Investment Mahmoud Mohieldin as saying.
The budget deficit could be well below the officially forecast 7 percent of GDP and economic growth is set to meet official forecasts of a 5-5.5 percent in fiscal year 2009/10, he added.
Inflation will be 6-8 percent, it was reported.
Mohieldin played down the prospect of any lasting damage to investor confidence in his country or wider region because of the debt troubles of state conglomerate Dubai WorldDubai World
, saying "At the beginning there was an exaggerated reaction....The market corrected itself after being fed the right information."
As for investment, Mohieldin said early figures for the fiscal year that begins in July were promising. "First quarter results show we can achieve our target of $10 billion dollars. The first quarter is confirming that trend for net FDI," he said.
"What we've been seeing as well is good reaction and response to some specific infrastructure projects," he said, mentioning medical centers, road networks and utilities, as areas "that are going to be getting us what we're after, from the Asian countries, some infrastructure funds based in Europe and from some of the Gulf countries."
"On local private sector investment, I think there is going to be an interesting rebound," Mohieldin said.
"We have a daily monitoring of newly-established firms, in addition to expansion of existing firms, and we could be seeing private sector investment this year approaching LE 125 billion, as compared to LE 113 billion last year."
"The range is between LE 125 billion and LE 140 billion," he added.
Despite the renewed fears about Dubai in financial markets, Mohieldin saw no reason to worry about the financial solidity of the broader UAE, that the Dubai city state is part of, and no reason either to fear for UAE operations in Egypt or investor sentiment towards Egypt.
As far as Egypt was concerned, he said: "Dubai is an important investor but it's part of a bigger and more important investment coming from the UAE at large," he said.
In its daily market report, Beltone Financial said, "We expect [real GDP] will be 5.1 percent and FDI flows could be lower than the government's projections, reaching $8.5 billion in fiscal year 2009/10 instead.
"We expect inflation will remain high in the few months to come, reaching around 17-18 percent in January 2010, before declining to an average of 12 percent in 2010, under a scenario of unchanged energy prices."
© Daily News Egypt 2009
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