Egypt will hold a conference in February to attract investment in an economy battered by years of political turmoil, the minister of planning said on Monday.
The Egyptian Economic Summit, to take place in the resort town of Sharm el-Sheikh, hopes to attract foreign companies, donors and international organizations, Ashraf al-Arabi said.
In June, Saudi Arabia’s King Abdullah asked countries to attend a donor conference for Egypt, his country’s most populous Arab ally, following its election of President Abdel Fattah el-Sissi.
The UAE, Saudi Arabia and Kuwait have provided more than $12 billion in cash and petroleum products to prop up Egypt’s economy since the ouster of Islamist President Mohammed Morsi last July. They see Morsi’s Muslim Brotherhood as an existential threat and are keen to see Sissi succeed since he toppled Morsi.
Egypt wants long-term investments to improve the country’s economy, which has been suffering ever since an uprising toppled President Hosni Mubarak in 2011. The unemployment rate is 13.4 percent, up from 9 percent in 2010, and 60 percent of youth are unemployed, said Arabi, a U.S.-educated economist.
Officials forecast economic growth at just 3.2 percent in the fiscal year that began July 1, well below levels needed to create enough jobs for a rapidly growing population and ease widespread poverty.
A successful conference might enable the government to push through reforms needed to reach agreement on a loan package with the International Monetary Fund. An IMF deal could then improve confidence among investors, who have been unnerved both by years of turmoil and by a host of other problems, ranging from costly energy subsidies to lack of transparency in economic management.
Gulf states, which have been planning the conference since April, have taken a keen interest in seeing Egypt, the largest Arab state, get back on its feet.
They see the country as the front line in the battle against the Muslim Brotherhood, whose populist platform helped it sweep post-Arab Spring elections. The Brotherhood’s political Islam put them directly at odds with the commitment to dynastic rule of the Gulf monarchies.
The Gulf countries also want to ensure aid and investment are spent efficiently in a country where past leaders with military backgrounds have often mismanaged the economy. The UAE, considered the most business-friendly environment in the region, hired Western consultants to advise Egypt on economic matters.
Cash transfers from the Gulf states have helped shore up Egypt’s foreign currency reserves in recent months. But reserves are still at less than half what Egypt held before the 2011 uprising against Mubarak.