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Monday, 8 June 2020

How does the Egyptian economy achieve escape velocity from the covid-19 downturn?

How does the Egyptian economy achieve escape velocity from the covid-19 downturn? The answer lies in the “strategic monetization” of public infrastructure, reorienting supply chains and capitalizing on business process outsourcing, Ahmed Galal Ismail, CEO of Majid Al Futtaim Properties, writes for the World Economic Forum. The government should focus on bringing into the fold infrastructure investors who have expertise in turnaround situations and steady value creation, and help pass on critical infrastructure projects (such as upgrading the power grid and improving water sanitation) to the private sector, thereby lowering government spending.

Responding to deglobalization trends: Egypt should look to develop local supply chains and work with Chinese firms to strengthen distribution networks and upgrade manufacturing capacity, Ismail says. Lessening dependence on increasingly fragile global supply chains will allow the government to develop local agriculture and integrate new technologies. On top of this, Egypt should exploit its warm ties with Chinese firms and use them to build stronger regional supply chains.

Capitalizing on demographics: The country’s young, educated population is also a key asset Egypt can use to market itself as an attractive business process outsourcing (BPO) destination for multinationals. With 500k graduates every year and one of the largest IT workforces in the world, Egypt is well-placed to attract new foreign investment in outsourcing, Ismail writes.

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