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RR RUEHWEB
DE RUEHEG #1985 2921554
ZNR UUUUU ZZH
R 191554Z OCT 09
FM AMEMBASSY CAIRO
TO RUEHC/SECSTATE WASHDC 3924
INFO RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUEHRC/USDA FAS WASHDC
UNCLAS CAIRO 001985
SIPDIS
STATE FOR NEA/ELA
E.O. 12958: N/A
TAGS: ECON EINV EFIN ETRD EAGR ENRG PGOV EG
SUBJECT: EGYPT'S ECONOMY: October 19 PRESS ROUND-UP
1.(U) The following are notable economic news stories that appeared over the past week in the Egyptian press:
--------------------------------- Telecom Egypt is Losing Customers ---------------------------------
2.(U) Amr Badawi, Chairman of the National Telecommunication Regulatory Authority (NTRA), told the press that
state-owned Telecom Egypt (TE) lost 1.4 million customers over the last three months, dropping from 12 million
subscribers to 10.6 million. The decrease is largely due to the tough competition that TE, the sole fixed-line operator
in the country, is facing from the three wireless operators. In an effort to try to compete with the wireless operators,
TE announced the reduction of the price of a phone call to areas outside Cairo to 3 piasters (roughly half a cent) per
minute from eight piasters per minute, which is lower than the prices offered by the wireless operators (Al Alam Al
Youm, Al Masry Al Youm, 10/13/2009). ------------------------------------------ Ministry of Investment Plans to Resume
Privatization ------------------------------------------
3.(U) The Ministry of Investment has decided to resume its privatization initiative, known as the asset management
program, in 2010. This marks a return to Egypt's traditional privatization program, after the GOE flirted with a plan to
give each citizen over the age of 21 a tiny share of state companies, a plan that was widely criticized by political and
civil society associations. The Ministry of Investment has finalized a list of 30 to 40 state-owned companies for which
it will begin offering private shares, pending approval by the Council of Ministers. According to the Ministry of
Investment, total privatization proceeds reached LE57.4 billion (US$10.44 billion) by FY2008/2009, for the sale of 409
companies since 1991 (Al Masry Al Youm, 10/13/2009). -------------------------------- Rice Export Restrictions Modified
--------------------------------
4.(U) Minister of Trade and Industry Rachid Mohamed Rachid announced the he would reverse previous plans to require rice
exporters to supply a portion of their crop to a government body, a move that had been intended to ensure domestic
supply. Rachid's announcement will separate the process of acquiring rice export licenses from the requirement to
provide the General Authority for Supply and Commodities (GASC) with rice. Rice exports will be limited to 450,000 tons
in 2009/10. In addition, export duties on rice will vary based on the difference between domestic and international rice
prices. (Al Ahram, Al Alam Al Youm, 10/14/2009). ----------------------------------------- Former UNEP Director
Discusses Pollution, Climate Change -----------------------------------------
5.(U) Mostafa Tolba, who was the executive director of the United Nations Environment Program (UNEP)for seventeen years,
told the press that the use of polluted water for irrigating food crops, which was reported in several governorates,
should be considered a criminal act. Tolba added that Egypt does not have an integrated system to deal with or treat
solid waste or wastewater, noting that 90% of Egyptian villages do not have wastewater treatment facilities and
therefore face extensive pollution of surface and ground water. Tolba also stressed the dangerous impacts of climate
change on Egypt and called for the establishment of a national committee to address it. Tolba estimates that
Mediterranean Sea levels are rising at a faster than expected rate(Al Masry Al Youm, 10/13/2009).
------------------------------------- Egypt May Increase Investment Ventures with Iraq
-------------------------------------
6.(U) Osama Saleh, Chairman of the General Authority for Investment and Free Zones (GAFI), predicted that Egyptian-Iraqi
investment cooperation would soon increase, especially in the fields of industrial development, urban development, and
tourism (Al Ahram & Al Akhbar, 10/18/2009) Scobey