BY : Mahmoud Hammad
To be eligible for work in the Commercial Representation Agency, you must be up-to- date with all information, qualified enough and have an inclination for strong discipline. There has been a slight raise in commodity prices after the increase in electricity prices. The dollar is expected to drop by the end of this year. CBE’s decision to subsidize fishery, dairy and livestock projects will ultimately decrease their prices. Businessman and economic expert Eng. Ahmed Samir, asserted that the Commercial Representation Agency plays an important and significant role and that Egypt must play a nationalist role during the current period, to promote Egyptian exports. CRA employees must therefore be responsible, qualified and committed to promoting exports in order to attract more investment in the Egyptian market. "The latest decision to raise electricity prices will lead to a slight raise in commodities prices, pointing out that CBE's decision to reduce the minimum size of small enterprises employed in agriculture, dairy, livestock and fishery, will lower prices of these products in the near future, " Samir added in an interview with MEO.
What is your impression of the increase in electricity prices for the commercial sector and how has this affected prices?
The Increase in the price of electricity is not a concrete rise, the government just removed its subsidization of electricity and fuel. On the other hand, government subsidies have been ongoing for long periods, and have been shouldered despite the state budget deficit. In order to rectify this unfavorable situation, it's very important for us to restructure our subsidy to make sure that it reaches those people who deserve it, and not grant full subsidy to everyone irrespective of whether they are entitled to it or not. That's a crucial factor. The government should undertake these measures, as part of its general plan, to reform the subsidy system, within the general budget provisions.
Will removing electricity subsidies lead to higher commodity prices?
The elimination of electricity subsidies will lead to a slight price increase, but prices are expected to decrease again after the dollar gradually depreciates by the end of this year and the beginning of the new year; the dollar is expected to reach EGP 12 within one or two years.
How do you see the current dollar value?
The current dollar value against the Egyptian pound is abnormal, and has led to a significant increase in commodity prices. Many commodities have increased by 100% and 200%. Therefore, the increase in commodity prices due to the surge in electricity price increase will not be the same in relation to dollar increase. The government strives to bridge the gap in trade balance between exports and imports.
How do you perceive the Central Bank of Egypt’s decision to reduce the minimum size of small businesses operating in agriculture and dairy projects?
The Central Banks decision pertaining agricultural, dairy, feed, fisheries, poultry and livestock projects, which came under the umbrella of the small and medium enterprises issued on January 11th, 2016, decreed that the minimum total sales of those projects would fall from EGP 1 m each to EGP 250.000 to reach a maximum of EGP 50 m. This category would be granted credit facilities at a simple diminishing rate of return 5%. This will work to enrich the Egyptian market during the inflation and recession times that affect Egypt as well as the rest of the world; in addition, this will need of support, and this is believed to be the right path to national income.
How do you discern the Commercial Representation Agency’s role now and in the future?
The Commercial Representation Agency plays an important and significant role, the country is in urgent need for such a role during the current times to promote Egyptian exports. The CRA is based on two aspects; the organisational aspect and the personnel aspect. The personnel aspect is related to employees who must be well trained until they are eligible for that position. Those employees must also be well disciplined, for instance if Egypt is participating in an international or local conference/ exhibition; the representative should go off on vacation during that period. provide citizens with low-priced commodities.
Do you think it will provide a competitive advantage for small businesses?
Yes, as the major entities will no longer monopolize the market by being the only entities that offers commodities with low-prices. Small businesses can also compete in Livestock and poultry projects; they will also provide low-priced products that will enrich market volume and benefit citizens.
How can one read the impact of this decision in reality?
Such a decision as the Small Enterprise Support Initiative gives indication that, Egypt is economically on the right path, and that it is following China’s model in supporting small enterprises and projects that are in dire
What about the Commercial Representatives data about countries?
The Commercial representative should have round the clock, up-to date information regarding data records. The representative should not rely only on The World Trade Organisation for obtaining data, because apparently some countries have their own individual character, especially African countries. African countries do not not provide any data, and therefore the Commercial representative is responsible for obtaining data independently. This applies to nearly a third of the world's countries and the majority of African countries.