By Hisham El-Zimaity Source: CGTN Published: 2018-11-08
The Prime Minister of Egypt Mostafa Madbouly congratulated Chinese President Xi Jinping, and expressed satisfaction at the great success of the China International Import Expo (CIIE), the first-ever import-themed national-level expo, as the president inaugurated the Egyptian pavilion at the fair.
Madbouly also delivered a speech at the opening ceremony of the fair where he reiterated Egypt's commitment to the comprehensive strategic partnership with China and reviewed Egypt's economic reforms during the past few years, which resulted in strengthened cooperation at the trade and investment levels with China.
China and Egypt: Ideal Partners
Today, Egypt is the ideal strategic partner for Chinese investments in Africa and the Middle East. According to the IMF's most recent report, growth in Egypt is projected to rise to 5.5 percent in 2019 reflecting a recovery in tourism, rising natural gas production, and continued improvements in confidence due to the implementation of an ambitious reform program supported by the IMF's Extended Fund Facility.
The IMF's projections on Egypt include five years of strong economic performance where the economy grows by 5.3 percent in 2018 and 5.5 percent in 2019 – and still be growing at 6 percent as far out as 2023. Also, unemployment will fall to 9.9 percent next year from 10.9 percent this year – down sharply from 12.2 percent in 2017.
Similarly, inflation will cool to 14.0 percent in 2019, down from 20.9 percent in 2018 and a high of 30 percent last year.
The current account balance of Egypt is expected to improve to -2.4 percent of GDP next year from -2.6 percent this year and -6.3 percent in 2017. So Egypt will be growing at more than two times the pace of the MENA region, where the IMF sees average growth coming in at 2.0 percent this year and 2.5 percent in 2017.
Egypt is also on track to outstrip growth in the wider Middle East, North Africa, Afghanistan, and Pakistan region, where the IMF is predicting 2.4 percent growth this year and 2.7 percent next year.
Trade and Investment Cooperation
During his visit, Prime Minister Madbouly also met with representatives of major Chinese companies and business sectors to discuss enhancing bilateral trade and investment cooperation.
He held talks with senior executives from Shanghai Electric and Dong Fang, the two energy companies building the 4.4 billion US dollars, 6 GW Hamrawein clean coal power plant by the Red Sea.
The consortium's top officials asserted that the project will be totally safe and meet world standards with nearly zero emissions. The companies are actually conducting the environmental impact studies before launching a survey of the construction site.
Executives from Shanghai Electric – and officials from state-owned Egyptian Electricity Holding Company (EEHC) are set to finalize the project's 4.4 billion US dollars financing arrangements soon. An Egyptian delegation is scheduled to visit China to inspect a similar power plant.
Madbouly also met with the chairman of China State Construction Engineering Corporation, the company developing the business district of Egypt's new administrative capital. The company will soon begin developing the district's 3.5 billion US dollars second phase.
Prime Minster Madbouly welcomed the assurances by President Xi that China's initiative to expand imports aims at promoting long-term common development, and that measures announced in April to relax market access have been so far implemented while simplifying negative lists of foreign investment and reducing investment limits.
China ever more committed to Africa
According to President Xi, China today is the world's second largest economy with a huge market of over 1.3 billion people and imports goods and services exceeding 30 trillion US dollars and 10 trillion US dollars, respectively.
Therefore, economic globalization should remain an irreversible historical trend providing strong momentum for the world economic development.
Therefore, all nations should be committed to opening up and oppose protectionism and unilateralism in a clear-cut stand, while sticking to innovation, and upholding the principle of inclusive development and shared benefits, in order to realize common development. Egypt supports this position.
From its side, China is accelerating opening in areas such as telecommunications, education, medical service and culture, and is working towards greater openness in the agricultural, mining and manufacturing sectors.
With regard to Africa, China promised to earnestly implement the major initiatives announced during the Beijing Summit of the Forum on China-Africa Cooperation (FOCAC) in the fields of agriculture, food security, industry partnering infrastructure development, energy, natural resources, tourism, investment and economic cooperation, trade, finance, environmental protection, and tackling climate change.
China today ranks as the number one trading and investment partner with Africa. Chinese firms are invited to form joint ventures with local companies to create more manufacturing bases in Africa while raising the volume of goods coming from Africa to China.
Hisham El-Zimaity is a non-resident senior fellow at Chongyang Institute for Financial Studies at Renmin University of China.