Interview: Egypt stock exchange in lead since 2014: EGX chief

The performance of the Egyptian stock market was very good since 2014 at all levels, not only in terms of share prices but also in terms of attracting new companies and increasing capitals, chairman of Egypt Stock Exchange (EGX) Mohamed Omran told Xinhua in an exclusive interview on Sunday.

"In 2014, we won presidency of the Federation of Euro-Asian Stock Exchanges (FEAS) that includes 34 bourse and we were the first stock to maintain membership of the executive committee of the African Securities Exchanges Association (ASEA)," said Omran, who took part in Egypt Economic Development Conference (EEDC) held from March 13 to 15 at the Red Sea resort of Sharm El-Sheikh.

He added that in September of the same year the EGX was celebrated at New York Stock Exchange as "the Most Innovative Exchange in Africa," stressing that it reflected the recovering financial market in the country after recent years of political turmoil.

Around 90 countries, some represented by heads of states, 25 organizations and international institutions, as well as top world economists, businessmen and diplomats, took part in the EEDC, the largest economic event that occurred in Egypt under the new leadership.

"The turnout was beyond expectations, which reflects great support of the political and economic roles Egypt play in the region," the EGX chief told Xinhua.

During the conference, Egypt signed investment projects with Arab and foreign companies that are worth billions of dollars, besides getting 12.5-billion-dollar investments and financial aids from the Gulf states of Saudi Arabia, the United Arab Emirates, Kuwait and Oman.

"This is a very important beginning for the return of the Egyptian economic growth rate to what it was before 2011, when it varied between six and seven percent," Omran remarked.

Egypt went through two popular uprisings in early 2011 and mid 2013 that toppled two heads of state, long-time President Hosni Mubarak and Islamist President Mohamed Morsi, ruining the country's economy and causing over 20-billion-dollar loss of the country's foreign currency reserves that reached 36 billion dollars during Mubarak's era.

"We believe this year, the growth rate will be around four percent or more, as the economic reforms the government takes ill have a big effect on the course of the Egyptian economy in the near future," the top man in the financial market expected.

In her remarks in the opening session of the EEDC, chief of the International Monetary Fund (IMF) Christine Lagarde commended the recent Egyptian economic reforms that included energy subsidy cuts and increase of taxation on alcohol and tobacco.

"The good news is that a journey to higher growth is already underway," she said.

Egypt's credit rating is also improving as the country's debt was upgraded in late 2014 from B- to B by Fitch Ratings, which praised the government's efforts to reduce budget deficits.

"The IMF testimony and the improving credit rating shows confidence of world financial institutions in the future of the Egyptian economic reforms which is reflected on the performance of the country's stock market," Omran said.

The EGX chairman said that 13 new companies were registered in 2014, ten times those registered in 2012, with 1.9 billion dollars of total capital that is currently on the rise, noting that the EGX has now some 72 registered companies.

Omran said that the anticipated flow of billions of dollars to the Central Bank of Egypt would lure more foreign investors who care about the availability of their safe exit or profit transfer in dollars at any time they desire. "Before they get in, investors would like to know how to get out first."

The financial official said that the biggest problems facing foreign investors are the lack of vision and the bureaucracy, which are resolved by the new political law through the new Unified Investment Law and the one-stop-window system that makes a licenses for a business establishment can be done in one place and within 15 days most.

On Sunday, Egyptian President Abdel-Fattah al-Sisi invited developed economies including China to take part in facilitated investment projects in the country.

"I invite advanced countries, the European countries, the American countries and China, to think about contributing to finance projects in Egypt carried out by their companies in a facilitated way to be paid off (by Egypt) over long years," Sisi said in his EEDC concluding statement.

The EGX chief commented that the Chinese companies are always welcomed to invest in Egypt and hoped to see more Chinese investments in the country in the near future. Endit