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The Mediterranean From Barcelona Back to Barcelona Funding from EMP to ENP to UfM Dr. Alaa Ezz Secretary General CEEBA & FEDCOC.

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Presentation on theme: "The Mediterranean From Barcelona Back to Barcelona Funding from EMP to ENP to UfM Dr. Alaa Ezz Secretary General CEEBA & FEDCOC."— Presentation transcript:

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2 The Mediterranean From Barcelona Back to Barcelona Funding from EMP to ENP to UfM Dr. Alaa Ezz Secretary General CEEBA & FEDCOC

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4 The Tsunami of Funding albeit the Economic Crisis

5 The Instruments Meda 2 (2000 – 2006) for 10 countries EC Grants of € 5.5 billion EIB loans of € 6.4 billion and EIB risk Guarantee of € 1 billion Meda 1 (1995 – 2000) for 12 countries EC Grants of € 4.6 billion EIB loans of € 3.4 billion ENPi (2007 – 2013) for 9 countries EC Grants of € 12 billion EIB loans of € 8.7 billion and EIB risk Guarantee of € 1 billion Neighborhood Investment Fund of €700 + contributions from MS Governance Facility of €300 million Neighborhood programmes & accession instruments NIF Leveraging loan resources from European Development Banks (x 4-5 times) CBC (including ERDF) € 173 +26.4 million Spring Fund € 300 million UfM 1 (2008 – ????) ???????

6 Origins of ENPI Regulation 1638/2006 of 24 Oct, 2006 EC External assistance: Responding to the call for simplification … More than 30 instrument s for delivering external relations assistance Policy driven instruments: ► Instrument for Pre-Accession Assistance (IPA) ► European Neighborhood and Partnership Instrument (ENPI) ► Development Cooperation Instrument (DCI) ► Economic Cooperation Instrument (ECI) ► Instrument for Nuclear Safety Cooperation (INSC) ► Human Rights Instrument Crisis response instruments: ► Humanitarian Aid Instrument ► Macro-financial Assistance ► Instrument for Stability Policy driven instruments: ► Instrument for Pre-Accession Assistance (IPA) ► European Neighborhood and Partnership Instrument (ENPI) ► Development Cooperation Instrument (DCI) ► Economic Cooperation Instrument (ECI) ► Instrument for Nuclear Safety Cooperation (INSC) ► Human Rights Instrument Crisis response instruments: ► Humanitarian Aid Instrument ► Macro-financial Assistance ► Instrument for Stability Before 2007 From 2007

7 ENPI EC financial support MEDA has most of ENPi ► Commission proposal: nearly €15bn ► End result: nearly € 12 bn, 45% increase in nominal terms and 32% in real terms ► 11.2 M€ ENPI & 0.8 Thematic programmes and HR instrument ► Commission proposal: nearly €15bn ► End result: nearly € 12 bn, 45% increase in nominal terms and 32% in real terms ► 11.2 M€ ENPI & 0.8 Thematic programmes and HR instrument Previous funding (2000-2006) Previous funding (2000-2006) Present funding (2007-2013) Present funding (2007-2013) EC budget: ► Total: €8.3bn ► MEDA €5.5bn ► TACIS € 2.3bn ► Thematic Programmes € 0.5 EC budget: ► Total: €8.3bn ► MEDA €5.5bn ► TACIS € 2.3bn ► Thematic Programmes € 0.5 Plus € 300 million SPRING FUND

8 EU financial Support EIB lending (2007-2013): ► Overall figures for the new mandate includes very substantial increase for 2007-2013. Ceiling for external lending mandate for ENPI is € 12.4 bn. (Mediterranean: € 8.7 bn / East: € 3.7 bn) ► Closer cooperation with International Financial Institutions (such as EU member states and the G8) is foreseen. EIB lending (2007-2013): ► Overall figures for the new mandate includes very substantial increase for 2007-2013. Ceiling for external lending mandate for ENPI is € 12.4 bn. (Mediterranean: € 8.7 bn / East: € 3.7 bn) ► Closer cooperation with International Financial Institutions (such as EU member states and the G8) is foreseen. Same for EIB lending Now the EBRD is in SEmed Countries With an initial € 1 billion

9 EIB funding is more for Private Sector

10 EIB funding is for SMEs

11 ENPI And at Last a Regional Element Country and multi-country programmes Minimum 95.0% (over € 10.6 bn) Country and multi-country programmes Minimum 95.0% (over € 10.6 bn) Regional & Cross-border cooperation programmes Up to 5.0% (almost € 550 million) /enhanced by another 0,5 Bln € from ERDF funding/ Regional & Cross-border cooperation programmes Up to 5.0% (almost € 550 million) /enhanced by another 0,5 Bln € from ERDF funding/

12 The ENPI Main features Partnership not Aid Strategy Papers Multi-annual Indicative Programmes Action Programmes ► Analysis of the situation ► Response strategy ► Priority sectors ► 7 years ► revised at mid-term ► normally attached to Strategy Papers ► set global and per priority allocations ► cover 3 – 4 years ► annual ► describe projects identified for financing ► define the budget per project ► lead to EC decision & commitments of funds

13 ENP New Instruments Technical Assistance Bilateral& Regional Budget/sector support Twinning Investment co-Financing Novel Inter-EU Instruments Taiex, Tempus, FP7, Erasmus

14 Regional Projects for Business –TRANSPORT: Motor Ways of The Sea; Galileo; SafeMed –TRADE & INVESTMENT: InMed Invest ; Aghadir; Euromed Quality; EuroMed MARKET; EIB FEMIP; FEMISE; MedADR; MedSTAT II; EU Medis; –ENERGY: MedEnec II; MedEMIP; RCREEE; WAMGM –R&D & TRAINING: Med Ibtekar; TEMPUS III; MedaETE –ENVIRONMENT: Horizon 2020; Meda Water; SMAP III

15 But what is in it for business ? Besides EIB & EBRD Funding

16 BUSINESS Indirect Benefit Direct Benefit Access to TA Tendering Access to Finance ServicesSuppliesWorks Business OpportunitiesBusiness Environment Reform of Public Admin. Reform of Financ. Sector Institution building Business Information

17 TENDERING DIRECT BENEFIT / Business Opportunities Services (TA) Supplies Works All bilateral All Regional All ENP Bilateral All bilateral All Regional All ENP Bilateral All bilateral All Regional All ENP Bilateral Transport Sector Support; Water Sector Support; Health Sector Support; Education Sector Support; Textile Sector Support; South Sinai; TVET; RDI; EPAP II; SMAP; NATP II; MWS; Galileo; SafeMed; InMed Invest; Euromed Quality; Aghadir; EuroMed MARKET; EIB FEMIP; FEMISE; Meda water MedADR; MedSTAT II; EU Medis; MedEnec; MedEMIP; RCREEE; WAMGM; Med Ibtekar; TEMPUS III; MedaETE Horizon 2020; Not only in YOUR Country

18 BUSINESS INFORMATION DIRECT BENEFIT / Business Opportunities - Customs Regulations - Legislative Requirements - Investment Incentives Business Co-operation Research and Development Environment and Sustainable Development Conformity Assessment Market Access Certification Environmental Legislation and Standards European Commission’s Research and Development Programmes “Partner Search” inside and outside the European Union

19 INSTITUTION BUILDING INDIRECT BENEFIT / Business Environment Programmes Prog. in Financial Sector Reform Budget Support REGULATORY REFORM & REFORM OF PUBLIC ADMINSTRATION REFORM OF FINANCIAL SECTOR Regional Programmes Institutional Twinning

20 The Dream 2010 FTA

21 And will not Affect the South Now Lags of import-tariff reductions

22 EU share is Small but not bad Source: Eurostat. Yet the EU is the main trading partner of the Med countries, absorbing around 50% of their exports

23 And is Supported Bilaterally

24 But how can the South-South Dimension be strengthened Real Adoption of the Pan-Euro-Med Rules of Origin “RoO” Harmonisation of laws in economic matters, Invigoration of trade exchanges, promotion of the industrial sector, promotion of economic activities and employment, improvement of productivity and living standards Co-ordination of sectoral and global economic policies, especially in the fields of foreign trade, agriculture, finance, taxes, services and customs And most important, more business information and cooperation and establishment of the missing trade routes

25 NO South-South Dimension for2010 FTA without Trade Routes (compare North & South)

26 And It Worked for Aghadir Trade Between Aghadir & EU (2000-2006)

27 Likewise it will work for all the Mediterranean

28 Its time to walk the talk and make every effort to utilize the available funding, means, networks, and cooperation channels;

29 And Utilize the available Funding May 2011: Deauville G8 summit: Egypt and Tunisia will receive aid worth more than 28 billion euros September 2011: The G8 countries and a number of world and regional financial institutions pledged $73 billion in aid to Tunisia, Egypt, Morocco and Jordan –Finance ministers from the G8 pledged $38 billion –IMF promised a further $35 billion as part of the Deauville Partnership

30 Funding Overseas Private Investment Corporation (OPIC), the U.S. Government’s development finance institution, approved $150 million in financing for investment in consumer foods, manufacturing and financial services, a step toward fulfilling OPIC’s commitment to provide $2 billion of investment support to the MENA region, announced by Secretary of State Hillary Clinton during her March 2012 trip to Egypt. July 2012, OPIC’s Board approved $500 million to support lending to SMEs in Egypt and Jordan. July 2012, Egypt repaid US$ 1 billion bonds and US$ 607 million of Paris Club Debt October 2012, Turkey committed US$ 2 billion loan for Egypt

31 Funding Gulf Support 17 billion US$ mixed grants and loans Qatar: 5 billion US$ deposit at CBE” (plus 9 billion US$ immediate investments in Alexandria and Port Said ports) Kuwait: 3 billion US$ “pledged” (plus a 1 billion LE fund in support of the stock exchange) Saudi: 4 billion US$

32 With Funding Eligible for foreign Companies Saudi Support to Egypt Budget Support Grant: 500 million US$ SDF Grant for SMEs: 200 million US$ SDF special loan for dev. projects: 500 million US$ Interest Free Deposit at Central Bank to support foreign reserve: 1 Billion US$ Government Interest Free loan: 500 million US$ Revolving Buying of Egyptian T Bonds: 500 million US$ Line of Credit for Saudi Exports to Egypt: 750 million US$

33 The Euro-Mediterranean Conference & Exhibition on Donor Funding, Banking and Novel Financial Instruments M E D A F I N A N C E The €22 Billion Initiative

34 The Aim To monitor available resources and network with the EC, EU member states and all donors & financial institutions aiming at the support of business through: Availing the highly needed information about sources of grants, technical assistance, soft loans, and novel financial instruments to their real target…SMEs Promoting novel financial instruments inclusive Non Banking & Novel Financial Instruments Factoring, Leasing, Mortgage finance, Venture Capital and private equity as the future funding mechanism worldwide. Strive to Repeat the InfraMed concept that was created by the Egyptian Co-Presidency of the UpM Giving credit and visibility to the EC and all our development partners

35 Meda Finance The Initiative 1.Survey of EC, EIB, EU member states and Multilateral grants, TA, lines of Credit, as well as novel non-Banking Financial Instruments available for the Euro-Med (over $ 22 billion so far), … but we continue 2.Setting up the mechanism for periodic updating 3.Conducting "The 1st Euro-Mediterranean Conference & Exhibition on Donor Funding, Banking and Novel Financial Instruments as a networking platform 4.Sustainability of the initiative and setting up the formula for replication 5.Follow-up with customized proposals to all donors

36 Meda Finance The Study CD A total of 113 instruments were sourced, that is besides the aid offered to Governments which is translated into tenders for services and supplies implemented by private sector from the Mediterranean 1.Over 43 instruments available for the whole region by 18 countries/institutions/programmes of AfDB, Belgium, EC, EIB, Finland, France, Germany, IDB, Japan, Kuwait, Netherlands, Saudi Arabia, South Africa, Spain, UAE, UNDP, UNIDO, USA, and WB/IFC/IBRD; besides what is offered to individual countries from Canada, Denmark, and Italy,.. and naturally the countries themselves. 2.Over 70 Instruments available for individual countries: Algeria 6; Egypt 35; Israel 4; Jordan 6, Lebanon 5, Morocco 10, Syria 4, Tunis 14

37 Meda Finance The Study CD Grants: in cash or as technical assistance up to Euro 1 million (50% to 80% of costs), feasibility studies, export finance, credit guarantee, diagnostics, upgrading, training, export promotion support, …etc Soft loans: up to 80% of project budget extending from US$ 100,000 up to 100 million, with interest from zero to less than commercial rate, both fixed and floating, both in euro/$ or local currency, with grace periods from 1 up to 8 years and maturity from 5 up to 15 years (sovereign loans are 0.75% interest, grace 10 years, and maturity 40 years)

38 An Annual Initiative for EuroMed SMEs To Bridge the Bridges Project with Finance

39 Egypt Albeit the present situation, it is still The Land of Opportunities Dr. Alaa Ezz Secretary General Federation of Egyptian & European Chambers

40 Egypt’s Economy Today 2012 estimates 2011 Estimates Key Indicators 2012 20112010 3.302.00-.703.30 Real GDP Growth (%) 12.111.6016.2011.10 Consumer Price Inflation (av;%) -10.50-11.00-10.40-8.00 Budget Balance (% of GDP) -1.6-1.40-2.70-2.00 Current-Account Balance (% of GDP) 6.106.206.105.63 Exchange Rate US$:LE (av) 7.106.096.155.80 Exchange Rate US$:LE (year-end) EIU 2011/2012

41 It’s the momentum of a decade Firm Commitment to Peace and Internal Political Stability. One of the top ten Global Reformers for five years (WB doing business report). Attractive Investment Climate. Free Trade Areas.

42 Attractive Investment Climate Macro-economic stabilization and comprehensive structural adjustments Clear transparent incentives Specific business opportunities

43 Clear transparent Incentives Special Incentives for localizing projects. Lowest Tax in the region (cut by half down to 20%), yet 124% increased revenue. Lowest customs within the region (4 years ahead of our WTO commitments), yet doubled custom revenue up to L.E. 14.7 billion from only 7.7 five years ago. Human Resources, R&D and grants Special Free Zones or Pre-Developed Free Zones. The Right to Possess and Own Land at very low cost. No Local Partner Conditions (100% Foreign ownership)

44 Macro Stabilization & Comprehensive Structural Adjustments Deregulation, Liberalization and Privatization Changing Role of the Government (from operator to regulator through PPPs) Rationalization of Public Expenses & Subsidies Tax & customs Reforms, Free Exchange Markets & Stronger Currency Elimination of Trade Barriers 5 years Top Global Reformer

45 Macro Stabilization & Comprehensive Structural Adjustments Simplifying Investment procedures, it now takes less than 72 hours to establish a company instead of 6 month few years ago Unified investment, Labor, Banking and Telecommunications laws aiming at restructuring the business climate and strategically simplify the legal framework for investment policies. Issuing modern legislations related to IPR, competition and consumer protection A top Ten Global Reformer

46 Booming Economy during 2010 in a world of negative growth GDP: + 7.2% (in 2008), 4.7% in 2009, 6.1% first half of 2010 Industrial investments increased 5 time in 4 years to reach US$ 30 billion Non oil Exports: Up to 105 billion US$ annually from 44 four years ago Tourism: + 71% in four years up to 11.6 billion US$ annually Suez Canal: +24% in 4 years to 3,1 billion US$ annually Egyptian Workers abroad: +100% to 9.8 billion US$ Natural gas and petrochemicals: Second export train with increased expectation Oil: rising international price CBE Reserve: Exceeding US$ 36 billion dollars where it was only 12 billion just four years ago FDI: +700% in five years to reach 9 billion US$ annually plus 15.6 billion US$ local investments

47 Which will Come Back ECD, Cairo

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49 And the Present Reserve Decline is a Global Issue

50 Same for the Stock Exchange

51 Egypt The Land of Opportunities Trade Large domestic market Easy access to regional markets Regional Free Trade Areas Bilateral Free Trade Agreements Retail Investment Infrastructure and Services Recapping Stock Exchange Banking & Insurance Takeover of liquidity problem companies Subcontracting Joint Ventures Training Centers Retailing Funded Mega Projects Gulf of Suez East Port Said North East Toshki Sheikh Zayed Canal “Toushki” East Oinaat Free Zones 12 PPP Industrial Zones 22 New Industrial Cities Specific Business Opportunities

52 The Local Market With a population of over 90 million and an increasing per capita income, Egypt has the largest domestic market in the region. Household Expenditure 2011 per capita food consumption +9.3%; forecast to 2015 +65.1% 2011 carbonated drink sales +5.6%; forecast to 2015 +56.4% 2011 mass grocery retail sales +14.9%; forecast to 2015+ 251.9%

53 Egypt, the cross-road of trade located in the Middle of all Trade Routs Free Trade Areas of 1.4 billion consumers (for manufacturing & Subcontracting 100% custom exemption, 35%-45% local content) –EU 27 countries –EFTA 4 countries –COMESA 19 countries –Greater Arab FTA “PAFTA” 18 countries –Mercosur 4 countries –Bilateral Free Trade Agreements USA and Turkey Easy Access to Regional Markets Modern Ports, Free Zones & Transit Facilities

54 Egypt still poses an excellent opportunity for foreign Companies to: Increase Exports to Egypt –Large market for technologies, machinery & products –Lines of credit & Grants –Modernization Needs Increase Foreign Exports to Third countries –Added value subcontracted assembly or formulation –To benefit from Free Trade Agreements Use Egypt as a Transit Trade Hub for the Region –Fast and Easy Access to Regional Markets –Utilize Egypt’s Modern Free Zones & Transit Facilities Trade, the two way approach

55 Foreign Companies Technology, Components, CKD, Inputs, Licenses, TRAINING, QC,..etc. Egypt Assembly, Formulation, Installation, Arabization..etc The Region COMESA Mercosur Turkey USA PAFTA EU27 + EFTA Royalty

56 Japan Funding Telephone Exchanges in Africa Design, supervision, CKD by NEC ُEgypt AOI: Local Assembly EgyCab: Supply of Cables ِArab Co: Installation Trilateral Cooperation for Africa

57 Japan Finance of airports, water stations, power plants,..etc Supply of core components Egypt Local Content, civil works,..etc. Trilateral Cooperation for Iraq

58 German Government Funding of Police training German Companies: Curricula and train-the-trainers program Egypt Police Academy: Training and hosting of Palestinian Police Force Trilateral Cooperation for Palestine

59 Foreign companies with Egyptian Partners for reconstruction of Libya Vinci Bouygues Technip Eiffage Saipem - Bilfinger Berger- Danieli & C Techint Group Impregilo Balfour Beatty Petrofac Ltd Joannou & Paraskevaides FCC - OHL - Ferrovial Agroman - EIFFAGE Tecnicas Reunidas Grupo Isolux HOCHTIEF - Bilfinger Berger - Joannou & Paraskevaides Ed Zublin AG - Siemens Polimeks Insaat Taahhut ve San Tic Renaissance - GAMA Enka Construction

60 History, Culture & Tradition Attractive Touristic & Recreational Sites Endless sandy beaches with International Facilities Spacious Residential Facilities International Education for the Children World Class Health Services Hospitable People and a Large Expatriate Community Pleasant Climate all the year And a very Spicy political climate Moreover, Egypt offers to tourists and foreign residents:

61 All these world leaders and many many more, evaluated the rest to invest in the best: ABB; Abbot; Babcock & Wilcox; Bayer; Birla; Boehringer; BMW; Cadbury; Carrier; Daimler Chrysler; Daewoo; Danieli; DOW Chemicals; Du Pont; Eveready; General Motors; General Motors; Henkel; IBM; Johnson & Johnson; LG; Macro, Microsoft; Moulinex; Nestle; Nissan; Otis; Otsuka; Peugeot; Pfizer; Philips; Proctor & Gambel; Roussel Uclaf; Samsung; Sandoz; Siltal; Sumitomo; Suzuki; Technocar; Toshiba; Unilever; Westinghouse; Xerox; YKK;..etc. They Came to Egypt, the land of opportunities.

62 We Invite You to guide your companies on the path of these pioneers who are reaping the fruit of their early arrival

63 Come to Egypt, in a tradition that is summarized in the following words of ancient Egyptian wisdom: “Rig your Boat, travel near and far, look for a wise partner, knock his door, seek his knowledge, welcome him in your home, this is how your people will prosper” Amenophet, 2,500 B.C.


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