Interview with Eng. Ibrahim El-Araby, Chairman of Egypt-Japan Business Council
According to the latest official data and statistics, Japanese investments in Egypt by the middle of 2018 amounted to 688 million dollars, of which 385 million dollars in the petroleum sector.
Egypt currently has about 66 companies, institutions and representative offices of major Japanese companies, but we still believe that these investments are not commensurate with the size of Japan compared to Japanese investments in many countries do not enjoy the investment facilities available in Egypt.
In view of the volume of economic cooperation between the two countries, we can see the following:
Although the decline in the total trade volume in 2017 from the previous year 2016 to about 300 million dollars, but the growth in the volume of trade between the two countries during the year 2018 is a very good indicator of the possibility of trade exchange between the two countries to the highest in the near future.
Also noted the entry of new Egyptian products to the Japanese markets in the past years, such as dried vegetables, frozen and processed fruits, as well as animal feed and increase exports of clothing and textiles, which is also a good indicator although of difficulties of entering the Japanese market and meet with Japanese standards, as you know.
Although the trade balance is still in favor of Japan at nearly 700 million US dollars according to the data of the year 2017, the Japanese tendency for many companies to inject more investments in manufacturing and re-export to Japan will be an important factor for trade balance between the two countries in the coming years.
At Overall levels, the economic relations between the two countries were affected after the January 2011 revolution, as did other countries. However, the recent Egyptian moves to overcome the revolution side effects and improve the business and investment environment and solve most of the obstacles faced by the Japanese investors in Egypt have caused a good sign on the relations between the two countries.
The visit of the Japanese Prime Minister to Egypt in January 2015 and the visit of the President of the Republic, President Abdul Fattah Al-Sisi to Japan in March 2016, had the greatest impact in supporting the economic cooperation between the two countries, and we all saw the results of these visits in the volume of signed agreements in business, educational and culture cooperation between Egypt and Japan.
We are optimistic that the next few years will witness a great growth of economic cooperation between the two countries.
What role does JEBC play in strengthening ties between Egypt and Japan?
Since its establishment in 1999, EJBC has adopted the structure of PPP to work together on promoting cooperation between Egypt and Japan in all sectors of Economic cooperation “trade, industry and services” and encourage Japanese investment. As well as social and culture relations.
The Council works according to a work plan, which is periodically updated to cope with the regional and international circumstances, in order to serve the interests of its members in all the commercial, industrial and service sectors, and above all to support the Egyptian-Japanese cooperation.
The council used to organize regular joint meetings for the Egyptian and Japanese businessmen in cooperation with JEBC and JCCI and our success partners in Egypt and Japan, also we used to receive enquires from both sides to explore the business opportunities and arrange the B2B meetings and networking accordingly.
Our council is in constant contacts with our counterpart to update the Egyptian economy and investment opportunities with the legal framework updates.
EJBC used to arrange the training workshops using the Japanese Kaizen management for Egyptian industrial sector in cooperation with MTI.
The multilateral role of EJBC supports third country cooperation in Middle East and Africa.
EJBC supports the LAS in organizing the JAEF since 2009 and supports Japanese Organization in organizing the TICAD.
As you know, the coming year will witness the 20th anniversary of JEBC, we are now working on ambitious plan for this year specially which will witness many join events and activities in Egypt and Japan.
What can be done to improve the business connections between Japan and Egypt?
It is well known to the globe the dedicated efforts of the Egyptian government to re-organize the business and investment environment and update the business legal framework and tax system in Egypt.
These efforts start to reflect more confidence in the Egyptian economy with its attractive factors from labor force, row materials, bilateral and multilateral agreements and the local market consumption with around 100M population.
The importance of bilateral and multilateral agreements that gives benefits to Egyptian origin products, and we have a very famous success story for Japanese company which is Sumitomo Denso wire harness factory.
As well known, the Japanese investor needs long time to study carefully before taking the investment decision, but once he takes it he committed.
Our role in council to keep the Japanese targeted investor updated with the economic situation in Egypt is important to accelerate his decision.
The opportunity for Japanese investors now is booming in new and renewable energy sector after the new amendments (feed-in-tariff) approved, and according to Egyptian strategy to achieve 20% of its needs from electricity from the new and renewable energy, 12% of this target is wind power.
We all know how much is trained labor force is important for Japanese company, so that we are targeting more Japanese training for the targeted sectors.
We think the new arena of Japanese industrial park will be important factor to attract more Japanese investors.
Working together with our Japanese friends on making joint Japanese Egyptian strategy for exporting Japanese products assembled in Egypt is very important.
We need more promotional business delegation between the two countries.
We need more specialized exhibitions for Japanese and Egyptian products in both countries.
more support for Japan desk in GAFI and similar organizations is needed
More support for Kaizen center and similar training centers in needed.
What message do you have for our readers regarding the future of the relationship between the two countries?
Dear Readers, Dear Japanese friends, as you may know, the last years witness a remarkable achievements aiming for long-term fruitful cooperation between our nations, the educational agreement is a very important that will build a well-educated generation used to use the success Japanese style in more success of business and friendly cooperation between the two countries.
Egypt is known with its unique geographic location that give ease of Japanese products access to Europe and Africa seizing the preferable of Egyptian origin, and the row materials, labor force and the local market consumption, I invited you to pay much intention to this market for the future of Japanese brands all over the world.
I would like to invite the Japanese decision makers to pay much intention to use the Japanese credit lines for SME’s through JIBC and other bodies, which will give more advantage to Japanese SME’s to explore the Egyptian investment opportunities.
Meanwhile, I invite the Japanese decision makers to pay more intention to the importance of updating the joint investment agreement that signed on 1978 in order to cope with the positive circumstances in both countries.
The Japanese success stories in Egypt are many; those companies seize the benefit factors in Egyptian business environment and re-export their products to japan and Europe union.
Please allow me to seize this good opportunity to invite all Japanese companies to participate in our Council’s upcoming events in 2019, and it is my pleasure to invite them to participate in our upcoming joint conference in Egypt in March 2019.