04 October 2001 (Business Times) - MALAYSIAN investors and businessmenhave been urged to seize investment opportunities in Egypt’s automotive,tourism, furniture and palm oil-related industries.Currently awareness of investment potential in these sectors is stillminimal and Malaysian investors can make inroads in these economicsegments by initially carrying out a detailed and comprehensive marketstudy, according to Essam Ismail, Minister Plenipotentiary and Economicand Commercial Affairs of the Egyptian Embassy in Kuala Lumpur.Egypt, with a population of 66 million and per capita income of US$1,000(US$1 = RM3.80), is a vast market of untapped potential, said Essam.“Currently the balance of trade between Malaysia and Egypt is in favour ofMalaysia.“Malaysia’s total exports to Egypt amounted to RM1 billion while importtotalled RM50 million from our country last year,” he added.The main export items from Malaysia to Egypt consist of palm oil, wood andrubber products, metals, machinery, electrical appliance and automobileswhile Egypt exports fruits and herbs, raw cotton and cotton yarn andaluminium to Malaysia.Egypt is Malaysia’s fifth largest consumer of its crude palm oil,importing over US$138.9 million last year.“By investing in Egypt in the palm oil sector, Malaysian investors areable to gain access to the 250-million Arab speaking market,” he said.Essam said there is ample opportunity for Malaysian businessmen to investin the production of automotive components such as seat belts, seats,exhaust, brakes and windscreen since the local component production isstill low at 40 per cent.“Our automotive industry was in existence long before Malaysia in 1955 butafter 46 years we only managed to produce less than half of the componentslocally,” he added.Essam said presently the two Malaysian national car producers, Proton andPerodua do not have any assembly plants in Egypt but have only appointedagents to sell their respective makes.One main factor attributing to the lag in the automotive industry Essamsaid was the long term effect on the economy due to the four wars withIsrael in 1948, 1956, 1967 and the last being in 1973 taking a heavy tollof over 1 million lives.Essam explained that the lack of information on investment opportunitiesand knowledge on the Egyptian market seem to be the main stumbling blockin the low interest shown by Malaysian investors.“We have organised several Egyptian investment seminars in several partsof Malaysia and I must say that business discussions during the meetingsbetween Egyptian and Malaysian businessmen do not normally result inconcrete follow-up measures.“In the end we see businessmen from both countries not being able to comeup with any real business relationship,” he said.Another sector which offers great potential is the tourism industry.According to tourist arrival figures of the Monthly Economic Digestpublished by the Ministry of Economy and Foreign Trade, Egypt received2.97 million visitors of which only 12,000 are from East Asia and Pacific.Essam said tourists arrivals from Malaysia last year were very minimalwith only 3,000, with students comprising one third of them.Essam added Egypt is trying to capture the large Jeddah-bound travellersmarket from Malaysia totalling some 170,000 who mainly go for the haj andumrah or business purposes.He said the Egyptian Government adopts a business-friendly approach andwelcomes foreign investment.Regulatory bodies such as the General Authority For Investment (Gafi) isresponsible to process foreign investment applications and formulate thenecessary policies governing foreign direct investments.“Our investment laws offer tax breaks of between 5 and 20 years fordifferent industries, “ Essam said.Apart from the incentives offered by Gafi, the Government has alsoinstituted all necessary legal framework to attract foreign investmentsuch as corporate tax guidelines, customs duties and regulations governingfree zones.“More importantly we encourage Muslim investors from Malaysia to formpartnerships with their Egyptian counterparts so that trade relationsbetween these two Islamic nations can be further enhanced,” Essam said.