How to Help Egypt Move Forward
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Even as Egypt’s transition to democracy continues to unfold, the country remains an important destination for investment, and the international community has a major stake in helping to stabilize and grow its economy.
The U.S. Chamber and the U.S.-Egypt Business Council are wrapping up a four-day U.S. business delegation to Egypt today. The group, which included representatives from 50 leading American companies and top administration officials, traveled to Egypt to deliver a simple message to the nation’s new government: Egypt is open for business, and the U.S. business community is ready to invest.
The international private sector’s stake in Egypt’s future is underscored by the fact that this delegation is the largest ever sent to the region by the U.S. Chamber, and the second largest sent to any country in the 100-year history of the institution.
To build a future that more widely shares prosperity, growth, and development, and to expand American investment across all sectors of the Egyptian economy, the Chamber’s U.S.-Egypt Business Council delivered a set of policy recommendations today to the U.S. and Egyptian governments. The recommendations, which were finalized after the delegation met with Egypt’s President Mohamed Morsi and his top cabinet officials, lays out concrete steps that, if taken, could help Egypt address its current economic challenges.
The recommendations include:
- Macroeconomic Stability – The completion of a $4.8 billion International Monetary Fund loan would send a positive signal to international investors. That deal, in concert with debt relief from the international community, should be the starting point for setting a fiscal agenda that diminishes instability, protects Egypt’s most vulnerable citizens, returns the country to fiscal health, and lays the foundation for strong and broad-based growth.
- Regulatory Transparency and Rule of Law – The Egyptian government should establish a transparent regulatory environment to ensure that the rule of law is maintained by an effective, independent, and expeditious judiciary. More specifically, the new regulatory framework should focus on maintaining the sanctity of property rights and contracts, integrating the informal economy, promoting fair competition, ensuring consistent enforcement, streamlining business regulations, and encouraging reasonable risk-taking by reforming bankruptcy laws.
- Facilitating the Movement of Goods and Services – Improving Egypt’s infrastructure, including modernizing ports, streamlining border controls, and investing in both physical and communications infrastructure will be critical to optimizing Egypt’s strategic location and developing the country as a regional and global hub.
- Protecting Intellectual Property and Trademark Standards – Without adequate safeguards on intellectual property and trademark standards, Egypt may lose a critical opportunity to become a hub of investment in areas such as pharmaceuticals and consumer goods. We believe that stepping up enforcement against illicit trade in counterfeit goods and smuggling would benefit the Egyptian consumer, Egyptian security, and the overall economy.
- Addressing Egypt’s Skills Imbalance – Egypt currently has a significant skills imbalance, where the education system produces many graduates whose skills too often do not meet the needs of the economy. We are committed to working with the Government of Egypt to help produce high quality educational outcomes at all levels.
Additionally, the following recommendations were delivered to the U.S. government:
- Launching a U.S.-Egypt Strategic Economic Dialogue –This would be similar to dialogues that the United States has with other important countries, such as India, Brazil, and China. This dialogue should be focused on concrete steps that the U.S. and Egyptian governments can take to strengthen their cooperation and support the development of a robust private sector. It should also include a comprehensive review of development assistance to Egypt.
- Resuming Discussions Leading to the Goal of a U.S.-Egypt Free Trade Agreement – The U.S. Chamber and the U.S.-Egypt Business Council have been strong supporters of a United States-Egypt FTA for many years. We believe that the importance of an FTA has never been more critical. An FTA would not only allow mutual market access, it would serve as an anchor for a stronger economic relationship and have tangible, long-term benefits for both economies.
- Debt Relief and Additional Assistance to Egypt –While we applaud the U.S. government’s pledge to provide Egypt with up to $1 billion in debt relief and budget support, and the provision of a $250 million loan guarantee facility for small and medium-sized enterprises through the Overseas Private Investment Corporation, we are urging Congress to provide additional assistance, including forgiveness of Egypt’s entire $3.2 billion debt to the United States.
As its transition continues, the Egyptian and American private sectors—led by the U.S. Chamber--call upon our governments to form a new partnership to move Egypt’s economy forward.