Executives upbeat about domestic growth prospects, findings reveal


Egypt’s businesses have begun increasing the tempo of their operations in recent IN PARTNERSHIP WITH TATWEER MISR AND GAT, buoyed by the country’s prospects for economic recovery, with newly adopted digital solutions and access to credit helping them to elevate their performance, according to a new Covid-19 CEO Survey carried out by the global research and advisory company Oxford Business Group (OBG) in association with the real estate company Tatweer Misr, the leading Egyptian real estate Company, and the Global Appraisal Tech (GAT).

Titled “Next steps: After a historic year, where do Egyptian business leaders see things heading in 2021?”, the survey gauges the views of executives on the economic consequences of the pandemic, as well as their outlook for the near term on a company and country level.

Alongside the findings, the survey includes an in-depth analysis of the answers and the broader economic climate in which they were obtained by Harry van Schaick, OBG’s Regional Editor. The results of the survey can be viewed in full at https://oxfordbusinessgroup.com/blog/harry-van-schaick/obg-ceo-surveys/next-steps-where-do-egyptian-business-leaders-see-things  

In an encouraging sign, given the challenging macroeconomic conditions across both emerging and more advanced markets, 71% of executives told OBG that their company is already operating at 61% capacity or above. Almost one-third (30%) had already returned to full operations by November 2020, with 36% expecting to be operating at 100% capacity by March 2021.

Bank loans – particularly those in local currency – remain the preferred source of capex financing amongst business leaders, according to OBG’s survey, highlighting the ample liquidity and high levels of capitalisation that lenders have, with a combined 40% of respondents selecting this as their favoured option, followed by internal financing (32%).

The findings also revealed that the majority (71%) of executives surveyed had sought out digital solutions to facilitate business continuity in the pandemic, suggesting that digitalisation efforts under way in Egypt are gathering momentum and reflecting trends witnessed worldwide.

OBG also asked business leaders for their views on whether Egypt’s recovery was likely to be driven by mostly internal or external factors. Almost half (48%) of respondents said they believe Egypt’s recovery will depend equally on domestic and international influences. Significantly, however, amongst the respondents who selected one over the other, the majority felt domestic factors would play a greater role than international influences in galvanising a recovery, implying confidence remains high amongst the business community in Egypt’s ability to navigate its future.

Dr. Ahmed Shalaby, President and CEO of Tatweer Misr, said that Egypt had reached several unprecedented economic milestones over the years on the back of the economic reforms programme implemented by the government, which had resulted in the country achieving economic growth of 3.6% in 2020, according to the International Monetary Fund (IMF) – the second-highest rate worldwide and in spite of the global pandemic.

“Egypt’s ambitious 2052 urban development plans represent a major breakthrough since, for the first time, the government is making steady progress in addressing the rise in population growth by increasing the country’s urban areas twofold to 14%” he said. “The plans also saw more than LE1 trn channelled into infrastructure upgrades between 2013 and 2017, connecting Egypt’s cities and providing modes of transportation that are now producing opportunities across the economic sectors.”

Tarek Madany, Managing Director of appraisal company Global Appraisal Tech (GAT) told OBG that the real estate sector is the major driver of economic growth in Egypt and remains the biggest contributor to GDP.

“Although nominal real estate prices continue to rise, real values remain stagnant. This is attributable to lower interest rates, new construction and ownership laws, the increase in supply from the construction of 20 new cities, as well as Covid-19. The outlook, however, remains positive,” Madany added.

Madany and Shalaby also explored the results of the survey further in a vidcast with OBG’s editor, Harry van Schaick, which will be released in the coming week.

Van Schaick said that the optimism displayed by business leaders reflected broader expectations that domestic growth is likely to outpace a projected sluggish global recovery, building on years in which Egypt’s economy has displayed considerable resilience.

“Looking ahead to 2021, while the IMF’s growth forecast for Egypt is a relatively modest 2.8%, the country is still expected to outperform others in the region,” he said. “Assuming that Egypt’s growth is more closely correlated with domestic factors than international ones, the continuous push to develop more infrastructure, reduce unemployment and cater to rapid population growth will be crucial to ensuring a positive economic trajectory in the coming years.”

Van Schaick’s viewpoint can be found in full on OBG’s Editor’s Blog, alongside additional analysis by all four of OBG’s Regional Editors on the markets that they cover. Titled “Next Frontier”, the blog serves as a platform for OBG’s experts to share their thoughts on the latest developments taking place across the sectors of the 30+ high-growth markets covered by the company’s research.

OBG began producing its CEO Surveys 5 years ago, as a way of giving licence-holders a handle on business sentiment in the economies it covers, termed the Yellow Slice markets, in reference to its corporate colour. Since then, they have become a highly popular and integral part of the firm’s portfolio of research tools.

The OBG CEO Surveys feature in the Group’s extensive portfolio of research tools. The full results of the surveys are available online and in print. Similar studies are also under way in the many markets in which OBG operates.

About OBG CEO Surveys

OBG CEO Survey Copyright (c). All rights reserved.

This survey has been designed to assess business sentiment among business leaders (Chief

Executives or equivalent) and their outlook in light of Covid-19 for the next 12 months.

For this special edition, the survey was conducted online by OBG staff, across the full range of

industries, company sizes and functional specialties. The results are anonymous.

This Egypt Covid-19 CEO Survey is based on 73 responses from companies within the following sectors, among others:

• 16% of companies surveyed are in financial services

• 14% of companies surveyed are in energy

• 14% of companies surveyed are in industry

• 11% of companies surveyed are in ICT

• 11% of companies surveyed are in construction

The data generated allows for analysis of sentiment within an individual country, as well as

regionally and globally. Additionally, comparisons can be drawn between both individual countries and regionally. The results are presented statistically within infographics and discussed in articles written by OBG Managing Editors. OBG provides this survey, infographics and accompanying analysis from sources believed to be reliable, for information purposes only. OBG accepts no responsibility for any loss, financial or otherwise, sustained by any person or organisation using it.

For further information on the content of the survey, please contact: Oliver Cornock, Editor-in-Chief, at ocornock@oxfordbusinessgroup.com. Should you wish to reproduce any element of this survey, infographics and accompanying analysis, please contact mdeblois@oxfordbusinessgroup.com. Any unauthorised reproduction will be considered an infringement of the Copyright. For further details about OBG and how to subscribe to our widely acclaimed business intelligence publication, please visit www.oxfordbusinessgroup.com.

Click here to subscribe to Oxford Business Group’s latest content: http://www.oxfordbusinessgroup.com/country-reports

About Oxford Business Group

Oxford Business Group (OBG) is a global research and advisory company with a presence in over 30 countries, spanning the Middle East, Africa, Asia and the Americas. It is recognised internationally as a distinctive and respected provider of on-the-ground intelligence on world’s fastest-growing markets, termed The Yellow Slice, in reference to OBG’s corporate colour.

Through its range of products – Economic News and Views; OBG CEO Surveys; OBG Events and Conferences; Global Platform, which hosts exclusive video interviews; and The Report publications – as well as its Advisory division, OBG offers comprehensive and accurate analysis of macroeconomic and sector-level developments for sound investment opportunities and business decisions.

OBG provides business intelligence to its subscribers through multiple platforms, including its direct 6 million verified subscribers, Dow Jones Factiva subscribers, the Bloomberg Professional Services subscribers, Refinitiv’s (previously Thomson Reuters) Eikon subscribers and more.

For more information, please contact:

Marc-André de Blois

Director of PR and Video Content, Oxford Business Group

E-mail: mdeblois@oxfordbusinessgroup.com

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About Tatweer Misr

Established in 2014, Tatweer Misr is a leading Egyptian real estate development shareholding company. It involves a vertically-integrated business model with various development fields and an ambitious vision of developing sustainable, smart and happy communities. Built on innovation, sustainability, high quality and creating adding value to their clientele, Tatweer Misr currently has four projects in various stages of development and planning. Projects include their award winning flagship project “IL Monte Galala” built on around 545 acres; “Fouka Bay” in the North Coast built on around 220 acres; “Bloomfields”; a mixed-use first home development located in Mostakbal City on an area of 415 acres with a dedicated 90 acres for an educational zone and their latest project “D Bay” spanning over 200 acres in the North Coast.

For more information visit: www.tatweermisr.c

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