EGYPT'S ECONOMY: December 14 PRESS ROUND-UP

UNCLAS CAIRO 002294

SIPDIS

STATE FOR NEA/ELA

E.O. 12958: N/A
TAGS: ECON EINV EFIN ETRD EAGR ENRG PGOV EG
SUBJECT: EGYPT'S ECONOMY: December 14 PRESS ROUND-UP


1. (U) The following are notable economic news stories that appeared
over the past week in the Egyptian press:

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Minister of Economic Development Predicts 6% Growth
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2. (U) Minister of Economic Development Osman Mohamed Osman said he
expects robust growth rates exceeding 6% in FY 2009/10, and climbing
to 7-8% during FY 2010/11. Osman said the real growth rate
approached 5% during the first quarter of FY2009/2010, which he
termed a good rate amidst the global financial crisis (Al Alam Al
Youm, Al Ahram 12/7/09).

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Dubai Scales Back Egyptian Investments
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3. (U) In the first actions taken to liquidate Dubai Holding
investments in Egypt, Dubai Financial sold a 5% share of EFG-Hermes,
a major Egyptian investment bank. Dubai Financial sold its shares at
a LE 700 million ($128 million) loss from their purchase price in

2007. The Dubai Ports company also announced that it would suspend
its planned $1.3 billion in investment projects around the Egyptian
port of Ain Sukhna (Al Mal, Al Alam Al Youm, Al Shorouk, Al Ahram,
12/8/09, 12/10/09).

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Rachid Calls for Continued Action against Crisis
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4. (U) In a meeting with the Federation of Egyptian Industries,
Minister of Trade and Industry Rachid M. Rachid said he expects
negative repercussions of the global financial crisis to continue
during 2010, and possibly 2011. Rachid called for continuing the
GOE's support for industry and exporters (Al Mal, Al Alam Al Yom,
12/8/09).

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23% Increase in Internet Users in Egypt in 2010
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5. (U) A report by the research group of CI Capital predicts that
Internet users in Egypt will grow by 23% in 2010, along with a 16%
growth rate for mobile phone users and a 5% growth rate in fixed
line telephone users (Al Shorouk, 12/7/09).

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Apache to Boost Oil and Gas Exploration
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6. (U) After a meeting with Steve Farris, CEO of the US-based Apache
company, Minister of Oil Sameh Fahmy said that Apache plans to
invest an additional $1 billion in oil and gas exploration,
particularly in the Western Desert region (Al Alam Al Youm,
12/9/2009).

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Mubarak Calls for Supporting Farmers
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7. (U) In a speech in the Upper Egyptian governorate of Minya,
President Hosni Mubarak asserted that the government is committed to
supporting farmers and is encouraging investment in Upper Egypt.
Mubarak also warned against a population explosion (Al Akhbar,
12/7/2009).

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Budget Deficit Up 3.4% Over 4 Months
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8. (U) Minister of Finance Youssef Boutros-Ghali announced that the
budget deficit had risen by 3.4% from July 2009 to October 2009.
Boutros-Ghali attributed the rise a decrease in government revenue
caused by the slowdown in economic activity due to the global
financial crisis (Al Ahram, 12/10/2009).

SCOBEY