CAIRO: Minister of Investment Mahmoud Mohieldin led an 80-member delegation of mostly businessmen last week to explore potential investment opportunities in another country.
This is pretty routine for ministry officials and business personalities, but it was the destination that made this visit unique: The delegation headed to Iraq.
While garnering much media attention in both countries, the visit had analysts wondering: Why Iraq? Why now?
Some said it was a little late to be eyeing Iraq, since global powers have been slicing up the investment pie since the US-led invasion in 2003. But Investment Minister Mohieldin brushes off these assumptions by simply saying, “It’s not late.
By the end of the three-day visit, several Memorandums of Understanding (MOUs) were signed between Egypt and Iraq in the fields of insurance and reinsurance, training in the non-banking financial services sector, trade, pharmaceuticals and real estate.
“There have been communications on the political level through the Ministry of Foreign Affairs, and there was an important visit paid by the Ministry of Petroleum a year ago, Mohieldin told Daily News Egypt in a phone interview Monday.
The delegation’s mission, he said, was “to meet Iraq’s market needs in several fields.
Concerns over tension, security and stability in Iraq were “much higher in the past, he added.
Secretary General of the Arab Investment Union Gamal Bayoumi said the visit has been a long-awaited step to activating economic cooperation between Egypt and Iraq. “We have been urging [officials] to open this file, he told Daily News Egypt, attributing the delay to security concerns in the war-torn country.
“We needed to wait until the security situation improved, he added, so there’s no repeat of what happened to late Egyptian ambassador Ehab El-Sherif, who was kidnapped and killed in Iraq in 2005. It took Egypt four years to appoint a new ambassador to Iraq, Sherif Kamal Shahin.
Striking a deal
Mohieldin said the agreements “have a practical nature – not the typical MOUs – in that they are attached with action plans, especially in the areas of knowledge-sharing and training.
The “first program to train 420 Iraqis in different sectors will start within a few weeks and will take 12 months. The rest of the projects will take one to two years, Mohieldin said.
A consortium of Egyptian construction companies submitted a proposal to build 75,000 housing units in Iraq, Sami Al-Araji, chairman of the Iraqi National Investment Commission was quoted by Iraqi media as saying.
Mohieldin clarified, saying the proposal is for a 240 acre housing project, phase one of which will see 50,000 units.
Egypt’s Holding Company for Food Industries will begin drafting a plan to build a sugar facility in Iraq, according to local media.
Egyptian businessmen and their Iraqis counterpart also struck a deal for a fertilizers factory in Northern Iraq, Mohieldin said, another in the field of infrastructure development as well as a real estate project.
In the field of medicine, there’s a plan to build a LE 70 million facility that will produce 40 million packages of medical solutions annually. Currently, the Iraq market needs 80 million packages, so the factory would essentially be providing half the supply.
Magdy Hassan, chairman of the Holding company for Pharmaceuticals, Chemicals and Medical Appliances, told local media that once they acquire land, it will take 18 months for the plant to be up and running.
Misr Import and Export Company also signed an MOU with the Iraqi Al-Mog Al-Azraq.
During the visit, as Al-Mal reporter Ahmed Radwan wrote, “The delegation’s convoy of 25 cars treaded carefully through Baghdad streets, passing numerous checkpoints and encountering heavy security at every turn.
While this may not be encouraging to potential investors, it’s doubtless that there are many prized investment opportunities in Iraq.
“Several Gulf countries have already initiated plans to invest in Iraq, Mohieldin said, describing Egypt’s visit as “well-timed, the fruits of which will be seen over the coming years.
An Iraqi delegation is due to visit Egypt at the end of 2009.