Egypt is expanding into the COMESA market - Courtesy of COMESA official website
CAIRO – 7 March 2018: The Common Market for Eastern and Southern Africa (COMESA) held its third COMESA-Egypt Business Dialogue conference on Tuesday, during which they introduced to the Federation of Egyptian Industries and Egyptian businesses their local sourcing for a partnership project.
The project is carried out through their online platform Biznet. Chairman of the COMESA, Amany Asfour, as well as important diplomats from African countries attended the event. The event aimed at connecting the Federation of Egyptian Industries with the COMESA Business Council.
During the opening, Sandra Uwera, chief executive officer of the COMESA Business Council (CBC) introduced the CBC to attendees. Uwera reiterated the importance of the COMESA block and the CBC due to the fact that it is “the only formally recognized business organization in the region.”
Uwera also made sure to point out to Egyptian businessmen and businesswomen at the event that “the CBC is the only business council who are mandated to sit, discuss and influence the business decisions of the private sector.” The CBC organization does not merely observe, it also acts and influences positive change, she explained.
The private sector, Uwera pointed out, is the “backbone” of every economy, and an economy such as Egypt’s stands to benefit much from its expansion into the COMESA, something that the CBC has witnessed over the past few years. “Egypt is expanding into the COMESA,” stated Uwera during her opening speech.
Agreeing with Uwera on Egypt’s great power in the continent and the huge profits it stands to make from expanding into the COMESA countries, Sherif al-Gabaly, head of the Federation of Egyptian Industries, said, “Egypt is the strongest industrial country in Africa.” As per Gabaly, Egypt has a great potential and has the capacity to fill in the import needs of the African countries. There is a need to cooperate more with African counties to increase business with them, explained Gabaly.
Asfour also spoke in similar vein during the opening ceremony. The chairperson of the COMESA told the attendees that the COMESA represents one of the biggest markets in the world; a market that holds endless opportunities for Egyptians. She explained, according to research results, that Egyptians favour doing business in European countries or the United States; however, they do not fully comprehend the amount of opportunities that African countries have to offer.
There are millions ‘to be mined’ in Africa, according to Asfour. Asfour holds the belief that by doing business in Africa and increasing the cooperation between Egypt and the COMESA countries, Egypt’s role in the region will be more effective, in turn, bettering its development trajectory, the African development, and the Egyptian development.
As it stands, the participation of Egyptian industries in the COMESA countries has numerous benefits; for example, the Egyptian exports to COMESA states have no added duty charges or fees, in addition the Egyptian businesses will pay less costs in deals made with the COMESA states, as logistical and shipping costs are less; however the products will be sold at prices equal to or higher than their usual prices.
In short, underpinned by great benefits and increasing international competitiveness, the Egyptian businesses would benefit greatly from connecting with African companies.
Currently, the top Egyptian exports are gold at $2.65 billion, crude petroleum at $1.81 billion, refines petroleum at $802 million, nitrogenous fertilizers at $767 million and insulated wires at $740 million, according to the most recent CBC report handed out during the meeting.
According to the same report, the top imports of Egypt are refines petroleum at $3.3 billion, petroleum gas at $3.2 billion, vehicles at $2.49 billion, packaged medicaments at $1.21 billion and wheat at $1.54 billion.
Egypt’s mainly exports to the United Arab Emirates (UAE), Saudi Arabia, Italy, Turkey and the United Kingdom. Meanwhile, Egypt mainly imports from China, Germany, Russia, the United States and Italy.
The council’s research suggests that although Egypt has expanded a lot into the COMESA states over the past few years, Egypt still has a lot to offer the states in terms of deals, expertise and much more.
“Egypt is the leading exporter in the region in terms of the value-added. Its intra-COMESA trades as a percentage of global trades is about 3 percent, while the whole of the COMESA’s is 6 percent, meaning that Egypt makes up for half of the global trades by COMESA,” stated Asfour.
It is expected that if Egypt further expands its role, the COMESA will also see an expansion in its global trade contribution, something that will quicken African development and ensure the continent edges forward quicker.
Egypt can expand its role, according to the COMESA, by connecting with African partners via the CBC, as well as any other platform, and increasing its intra-COMESA trade. CBC believes, “Egypt has a high potential to increase intra-COMESA trade by $24.9 billion.”
Egypt, according to a research carried out by COMESA and the CBC separately, has the potential to increase its trade by $10 million in products like cheese, dried vegetables sunflower seeds, fruit juices, concentrated tea and coffee, mineral or chemical fertilizers and essential oils, among other items.
Egypt can also increase its trade with African countries by some $5 million in natural honey, vegetables, new pneumatic tires, packaging containers, cotton yarn, and so on.
As it stands, two issues, highlighted by Gabaly, may slow the process of Egypt’s expansion into the COMESA. First, there is a problem with connectivity. There has to be a better connectivity system between African countries and within the countries. Gabaly gave the example of the highway being built from Egypt to South Africa, suggesting that more projects like this need to be carried out. Second, there is a need to ensure that there is an industrial integration between countries, which is where the CBC is able to help out, explained Gabaly.
Gabaly, Asfour and Uwera believe that Egypt has a great potential in expanding into the COMESA and much value to add to the COMESA trading deals. They all look forward to Egypt having a much bigger role in the COMESA deals.
CBC is the recognized Business Member Organization (BMO) of the COMESA. It represents the private sector interests at the highest levels of the decision-making process and continuously pushes for positive change.