The Egyptian Businessmen Association, in partnership with the Bahrain Businessmen Association and the Egyptian Embassy in the Kingdom, discussed opportunities and areas of investment in the financial and banking sector in Egypt and Bahrain, during a joint forum attended by elite businessmen in the two countries, via video conference technology.
The participants of the Egyptian-Bahraini Forum recommended accelerating the establishment of an Egyptian-Bahraini digital bank, organizing a reciprocal visit to explore investment opportunities in Egypt and Bahrain on the ground, implementing the recommendations of the First Investment Forum and the results of sectoral meetings.
The opening session of the Investment Opportunities Forum in the Financial and Banking Sector in Egypt and Bahrain was opened by Ali Issa, President of the Egyptian Businessmen Association, Ahmed Abdullah bin Hindi, President of the Bahrain Businessmen Association, Hassan Hussein, Chairman of the Banking and Exchange Committee of the Egyptian Businessmen Association, and Yasser Shaaban, Ambassador of the Arab Republic of Egypt to The Kingdom of Bahrain and the Ambassador of the Kingdom of Bahrain in Cairo Hisham bin Muhammad Al-Jowder.
The forum was attended from both sides by Adnan Ahmed Yousef, President of the Bahrain Association of Banks, Abdullah Muhammad Janahi, Director of Trading Operations for the Bahrain Stock Exchange, Ahmed Al-Sheikh, Vice President of the Egyptian Stock Exchange, Abdullah El-Ebiary, Head of the Investment Sector at the Sovereign Fund of Egypt, Muhammad Sharaf, Head of the Investment Sector at Banque du Caire, and a group of Businessmen and experts in the financial and banking sector from both countries.
At the outset, Engineer Ali Issa, President of the Egyptian Businessmen Association, congratulated Ahmed Bin Hindi on the assumption of the presidency of the Bahrain Businessmen Association, and thanked former President Khaled Al-Zayani for his efforts during the past period to support bilateral cooperation between the two associations.
Engineer Ali Issa pointed to the positive and vital role of the Egyptian and Bahraini diplomacy represented by Ambassador Yasser Shaaban, the Ambassador of the Arab Republic of Egypt to the Kingdom of Bahrain, and the Kingdom's Ambassador to Cairo Hisham bin Muhammad Al-Jowder in promoting the strengthening of economic relations and overcoming all obstacles facing investors and businessmen of the two countries during the last period.
Issa said, Our meeting represents a new episode in the series of joint economic work between the business community in our two brotherly countries, within the framework of strengthening and activating mutual cooperation in all economic fields, in light of the recommendations of the First Investment Conference to identify a group of economic sectors to hold specialized meetings between the two sides. For each sector, the first joint sectoral sessions were allocated to the construction and real estate investment sector, while the second of these sessions came to discuss investment opportunities in the financial and banking sectors in the two countries.
He added, "We hope, through joint cooperation meetings, to succeed in enriching aspects of cooperation to enhance economic relations, exchange benefits, create strategic partnerships, exchange experiences and information, and work to solve all obstacles facing the growth of joint investments, in order to achieve equal opportunities for both sides under the wise leadership of the two brotherly countries."
Ahmed Abdullah bin Hindi, head of the Bahrain Businessmen Association, said that the banking and financial sector constitutes a vital artery for all economic sectors and a basic building block on which all commercial projects are based, noting that the political leadership in the two brotherly countries attaches great importance to developing economic and trade relations by signing many agreements. Bilateral relations in order to increase trade exchange between the two brotherly countries and develop economic ties between them.
Hendy added that despite the diversity of partnership and cooperation relations, the volume of investments in the Bahraini and Egyptian sides is still less than ambitious and does not reflect the capabilities available in the two countries, as the volume of non-oil inter-trade amounted to about 432 million US dollars last year, but there are many opportunities The untapped investment in various economic sectors in the Kingdom of Bahrain and the Arab Republic of Egypt, including the banking and financial sector.
He stressed the keenness of the Bahrain Businessmen Association to open new horizons for joint cooperation by organizing a series of investment forums in cooperation with the Egyptian Businessmen Association and with the participation of elite businessmen and investors from the private sector in both countries in order to discuss investment opportunities available in each side and create joint economic projects .
For his part, Ambassador Yasser Shaaban, Egypt’s ambassador to the Kingdom of Bahrain, stressed the importance of holding business forums to discuss strengthening economic relations in a manner that is commensurate with distinguished diplomatic relations, noting that the volume of exchange witnessed a growth during the past year despite the repercussions of the Corona pandemic, at a rate ranging between 10 to 15%. Totaling about $500 million in 2020.
Shaaban added that stimulating investment in the financial and banking sector is an important factor to serve the economic sectors and increase employment and investment opportunities, as the financial and banking sector has been characterized by activity and growth over 50 years.
The Egyptian ambassador indicated that the Egyptian-Bahraini relations are witnessing great momentum and prosperity in light of the coordination between the two embassies and the mutual support of the political leadership and diplomacy in various international forums and with the consensus of the vision to develop relations under the ardent desire of the leaders of the two countries through accessing mechanisms to increase and review incentives and revitalize the role of financial institutions in Financing service sectors and projects.
Ambassador Yasser Shaaban said, they called on businessmen in Egypt and Bahrain to take advantage of the multiple investment portfolios in the two countries and to re-orientate the productive, service and development sectors in order to create the permanence of activities that benefit the increase of investment and employment opportunities and the expansion of production activities for a specific number of goods to increase the trade balance.
For his part, the Ambassador of the Kingdom of Bahrain in Cairo, Hisham bin Muhammad Al-Jowder, said that the rapid growth of the financial and banking sector in the Kingdom of Bahrain, and the depth and diversity characterized by it, is only the result of a wise vision from His Majesty King Hamad bin Isa Al Khalifa, may God protect him and protect him With the support and support of His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince, Prime Minister and Chairman of the Economic Development Board, may God protect him, and evidence of Bahrain’s continuous steps towards stabilizing the pillars of the national economy within the Bahrain Vision 2030.
Al-Jowder added, The Kingdom of Bahrain has become a regional banking center that has succeeded in attracting many foreign banking institutions, especially since the financial and banking sector in the Kingdom has not been affected by the repercussions of the Corona pandemic, which constitutes a more attractive element for Manama to be the financial capital of the entire region, where the performance of This sector contributes 17% to the gross domestic product, and achieves an annual growth of at least 10%. The Kingdom currently hosts 382 financial institutions, including 98 banks, including 21 Islamic banks. The value of the sector’s assets in June 2020 amounted to about $211 billion, Which provides additional advantages and an element of attraction for investors from outside Bahrain.
The Kingdom’s ambassador in Cairo explained that the volume of Bahraini investments in Egypt amounted to $3.2 billion for 216 projects, and the Kingdom occupies the 16th place in the list of countries investing in the Egyptian market. We also find that there are the top 10 Bahraini companies investing $753.3 million in Egypt, including a number of Existing investments in the financial and banking sector, as it contributes $309.6 million to Ahli United Bank Egypt, $117 million to Al Baraka Banking Group, $90 million to the Arab Banking Corporation, and Ithmaar Bank contributes $43.6 million to Bank Faisal Al Islami, and other investments in this important banking sector.
The Bahraini ambassador pointed out that last May, a delegation of Bahraini industry and commerce, during their visit to Cairo, discussed establishing a direct trade hub between the sisterly Kingdom of Bahrain and Egypt, to enhance economic cooperation and increase the rates of inter-trade and joint investments in various fields, including the financial and banking sector.
Al-Jowder pointed to the great efforts made by the Egyptian government to attract Bahraini investments to Egypt, and the brothers' keenness to overcome any obstacles facing Bahraini investors, calling on Egyptian businessmen to invest in their country, Bahrain, noting that the Kingdom of Bahrain possesses all the ingredients necessary to attract foreign capital to invest in it. Being an important platform to access the markets of the Gulf Cooperation Council countries, where the Kingdom ranks 43rd in the world and second in the Gulf countries in the ease of doing business index for the year 2020 issued by the World Bank, and 45th out of 141 countries and fourth in the Gulf in the competitiveness index The international market issued by the World Economic Forum, and the Kingdom provides facilities to foreigners by allowing them to own commercial records at 100% in most sectors, and provides foreign investors with a long-term residence permit, and the Kingdom ranks first in the world as the best place to live, and the financial services sector is one of the most important current sectors The most promising investment in Bahrain.
Hassan Hussein, head of the Banking and Exchange Committee at the Egyptian Businessmen Association, explained that the Egyptian banking sector is divided into two parts, the first for banks and is subject to the supervision of the Central Bank of Egypt, and the second to the non-banking sector and subject to financial supervision.
Hussein stressed that the economic reform contributed to reducing the number of banks from 55 banks during the past 5 years to 38 banks, as the Central Bank’s policies that encouraged acquisitions contributed to capital increases in this sector, as well as motivating 3 Bahraini banks in Egypt to expand, namely Al Baraka Banks. The Arab Banking Corporation, and the Ahli United Bank, which acquired Delta International Bank.
He explained that the general trend of the state supports the expansion of the banking sector in the banking retail program, pointing out that Egypt is a pumping market in need of all banking services and expansion in various geographical areas within the framework of the policy of the state and the Central Bank of Egypt to achieve financial inclusion.
He pointed out that the non-banking sector in Egypt includes many non-banking activities from financial companies to real estate finance, factoring companies, consumer finance and microfinance, all of which contribute to increasing banking retail and financing individuals.
He pointed out that the state's financial policy is directed towards the formation of financial entities to provide a variety of banking and non-banking activities, which represents huge opportunities for Egyptian-Bahraini and Gulf partnership and investment in the financial and banking sector in the two countries.
Hussein stressed that the offers to acquire the banks announced by the Central Bank of Egypt represent one of the most important investment opportunities for the sector in the two countries, in addition to the fact that Bahraini financial funds have great opportunities to invest in their capital in Egyptian stocks and bonds, whether to acquire all shares of a bank or the dollar bond market. Which ranges between 3 to 4% dollars and has short and long term terms of up to 30 years.
Adnan Ahmed Yousef, Chairman of the Board of Directors of the Bahrain Association of Banks, said that the Kingdom of Bahrain is a distinguished and advanced international banking and financial center that provides all facilities and privileges for investment from all over the world, including the freedom to transfer capital and profits, and the freedom to establish companies with capital in local or hard currency, in addition to preparing their statements. The financial position, with the stability of the price of the US dollar against the Bahraini dinar, and the absence of taxes on profits.
He added that the Bahrain Financial and Banking Center, which was established more than 45 years ago, today plays a pivotal role in the national economy, as it is the first contributor outside the oil sector to the domestic product, at a rate of up to 17%, and employs more than 14,000 employees, and plays a role A key factor in financing the wheel of economic growth and meeting the needs of economic activities.
He said the banking and financial system in Bahrain is characterized by depth and diversity, which provides additional advantages to investors from outside Bahrain, as it consists of conventional banks and Islamic banks, and constitutes the largest component of the financial system, as it is unique to more than 85% of the total financial assets of the sector, and the total number of institutions The country's financial sector has 376, including 30 retail sector banks, 68 wholesale sector banks, 16 foreign bank branches, and 7 representative offices. These institutions also include 36 insurance companies, 52 investment businesses, and 53 specialized licensed companies.
He explained that the value of the banking sector's assets, by the end of December 2020, amounted to about $208 billion, more than six times the annual gross domestic product of Bahrain.
He said the distinguished relationship between the two countries succeeded in reaching the stage of integration through joint development projects in all economic fields, diversity and broad prospects for more mutual investments and projects, based on the trade exchange agreements between Egypt and Bahrain in 1982, where the agreement to facilitate and develop trade between Arab countries was signed within Arab League activities.
He added that an agreement to support trade exchange between Bahrain and Egypt was signed on November 21, 1993, and a committee was formed at that time to follow up on the implementation of the trade agreement between the two countries. In 1997, Bahrain signed an agreement to establish an Egyptian commercial center in the Kingdom of Bahrain, while the two countries signed a memorandum of understanding in the field of establishing and managing industrial zones between them in 2009. The two countries also signed an agreement on non-dual taxation and a maritime trade agreement that can be used as a nucleus to attract more investments between the two countries. .
With regard to the volume of intra-regional trade for 2019, it amounted to $471 million, with Egypt occupying the fifth place with 5.82% as a trading partner for the Kingdom of Bahrain with regard to non-oil exports for 2019 at a value of $356 million, and for imports for 2019, Egypt ranked the 25th trading partner with a rate of 0.70 With regard to re-exports, Egypt represented the 11th trading partner of the Kingdom of Bahrain by 1.07%, with a value of 23 million dollars.
The number of registered companies and agencies reached 1260 companies with shareholders from Egypt, and the Egyptian commercial agencies registered 11 agencies, and the number of branches of Egyptian companies in the Kingdom of Bahrain reached 3, according to the records system of the Ministry of Trade, Industry and Tourism in the Kingdom of Bahrain.
He added that there are continuous efforts to increase Bahraini investments in Egypt, which amount to about $3.2 billion in 216 projects, ranking 16th in the list of countries investing in the Egyptian market.
In the second session, Mohamed Ragaei, head of the investment sector at Banque du Caire, spoke about the role of the banking sector in developing investment relations and increasing trade exchange, referring to the experience of Banque du Caire in working within the banking sector in the Kingdom of Bahrain until its exit at the end of 2003.
He stressed that the economic relations between the two countries are distinguished, noting that despite the challenges the world has witnessed due to the Corona crisis, Egypt is the fifth trading partner of the Kingdom of Bahrain with non-oil exports *34* million dollars in 2020, while Bahraini investments in Egypt amount to 3.2 billion dollars.
He explained that the customs cooperation agreement, in addition to studying the establishment of a joint bridge for trade, will make Bahrain a center for Egyptian exports to be rescued to the markets of the Arab Gulf states.
He pointed out that banks play an important role in facilitating economic transactions and financing investment operations, whether for the government or the private sector, and directly contributing to companies in their various stages, as well as transcending their role in financing to technical aspects and consulting.
Ragaei pointed out that the size of the loan portfolio in the Arab world amounted to $2.2 trillion at the end of 2019, noting that the volume of loans in Egypt at the end of 2020 exceeded 160 billion pounds, with 70% of non-governmental loans, and varied between 20% for industry, 17% for services, and 7% for the sector. Trading.
He pointed out that Banque du Caire has been operating since the fifties and has had a presence in the Arab country in the eighties and nineties and is currently among the 6 largest banks operating in 0, while the loan portfolio at the end of March 2021 amounted to 6 billion dollars.
He pointed out that the lending portfolio of small and medium-sized companies amounted in March 2020 to about 600 million dollars, while the demand for consumer loans is increasing.
He pointed out that investing in the real estate sector is one of the most important investment sectors for the banking sector in Egypt, where the sector is witnessing a great boom in the absence of real estate funds, as in Arab countries such as Saudi Arabia and the UAE, and thus represents new opportunities for investment besides the tourism sector, as Egypt has all the elements of the tourism industry. In light of the leadership's interest in attracting investments to revive the sector.
Mohammed Ragaei said that the small enterprise sector represents huge job opportunities for the investments of the Bahraini and Arab banking sector, as the sector contributes 43% of the gross domestic product in light of many initiatives to stimulate investment in it, especially foreign investment.
He added that banks also play an important role in supporting exports and reaching the target of $100 billion in the coming years, which requires directing investment to priority productive industries, including agricultural crops, food industries, furniture, clothing, and others, pointing to the existence of an ambitious program for the Egyptian government to replace imports for the purpose of settling input industries. Local production to reduce the import bill, create job opportunities and increase exports.
In the third session on the role of the non-banking financial sector, Abdullah El-Abyari, head of the investment sector at the Sovereign Fund of Egypt, spoke, noting that the fund enjoys a special law that gives it the strength of the government and the flexibility of the private sector, as the Ministry of Finance contributes to it.
He pointed out that the objective of the Sovereign Fund of Egypt is to maximize the return on untapped state assets, create job opportunities, attract capital, and localize new industries, foremost of which are digital transformation projects and new and renewable energy, noting that the fund is currently focusing on a number of priority sectors for the state, including the health and education sector. Infrastructure, tourism and real estate investment, in addition to the food sector.
He explained that the fund is currently working on creating a partnership to establish two schools with the aim of developing education, especially for the middle classes, which amount to 1.5 million students, in addition to infrastructure projects, where we are discussing managing water projects and interest in entering into partnerships in the renewable energy sectors, especially in solar and wind energy.
He added, in the field of industry localization, the Sovereign Fund of Egypt is currently transferring expertise in the railroad industry sector and monorail projects through the foreign partner of technology providers, which operates a large number of feeding industries in addition to creating distinguished investment opportunities that were not available to the private sector, He stressed the readiness of Egypt's sovereign fund to create successful partnerships for all parties.
During the session on cooperation between the Egyptian and Bahrain Stock Exchanges, Ahmed Al-Sheikh, Vice-President of the Egyptian Stock Exchange, said that the Egyptian government adopted and implemented a comprehensive national economic reform program that contributed to achieving stability in macroeconomic indicators, restoring the confidence of the private sector and enhancing economic growth rates.
The Deputy Chairman of the Bourse continued, "We look forward to diversifying the areas of cooperation with the Bahrain Stock Exchange, as well as further activating the memorandum of cooperation signed between the two parties in a way that achieves the interests of both parties at the level of developing capabilities and exchanging experiences in the banking and non-banking financial field, which contributes to enhancing inter-investment in general and in securities in particular ".
Al-Sheikh stressed that the Egyptian stock market interacted positively with the comprehensive economic reform program that was set and implemented by the government, starting with the financial and monetary reforms, up to the structural reforms aimed primarily at improving the environment for doing business, as well as various legislative reforms and cooperation with development partners, which contributed to achieving Discipline in the exchange market, as well as attracting foreign investments and enhancing foreign reserves, as well as enabling the Egyptian state to achieve a primary surplus in the state’s general budget, which enables it to allocate part of those savings to improve basic services that contribute to improving living conditions.
Al-Sheikh, Vice-President of the Egyptian Stock Exchange, pointed out that the Egyptian stock market is an important tributary that contributes to diversifying sources of funding for all entities operating in various economic fields, to help them access the funding required for expansion and growth, increasing production and employment, as well as being a trading and investment platform that contributes to attracting Domestic and foreign investments.
The Sheikh revealed some indicators that reflect the development of the performance of the Egyptian stock market, as the value of acquisitions activities in the stock market increased during the last 4 years to about 45 billion pounds, and the value of public offerings since 2010 amounted to about 26.54 billion pounds, while the value of capital increases since 2006 amounted to about 175.9 billion pounds.
While the number of companies registered with securities is about 240, of which 214 are in the main market and 26 are in the small and medium-sized companies market, in addition to 2 closed investment funds and one closed real estate fund, while there are 130 brokerage companies, pointing out that the market capitalization of shares at the end of April 2021 amounted to about 651 billion pounds, while the market capitalization of bonds 1.8 trillion pounds at the end of the same period.
For his part, Mohammed Janahi, Director of Trading Operations Department of the Bahrain Bourse, stressed the importance of exploiting the financial products available in the two countries by activating the cooperation agreement between the Egypt and Bahrain Bourse to facilitate the procedures for trading securities and exchanging information, in addition to setting common rules to facilitate and promote the shares of the offered companies.
At the end of the forum, Khaled Al-Zayani, former head of the Bahrain Businessmen Association, said that the Kingdom attaches great importance to encouraging investment in renewable energies by providing the necessary external funds, pointing to the launch of a project to produce electricity from solar energy, in addition to the implementation of two projects in Mozambique and the Kingdom of Bahrain. It is intended to launch two solar energy projects in Turkey and Saudi Arabia.
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