Egypt, optimistically

I recently attended a panel discussion at The Atlantic Council in Washington on Economic Recovery and Revitalization in the Middle East. I was immediately struck by the fact that three of the four panelists were Egyptian, one of whom co-authored the report on which the panel was based. Each one of the three panelists has made enormous strides in helping to transform the Egyptian economy by creating and supporting sustainable, high impact businesses, as well as to transform education. A few days later, I read in the local media a summary of the Sisi administration’s economic and social accomplishments and goals over the past year. And just recently I saw the statistics of the private sector’s continued contribution to the country’s economic recovery, despite the severe drop in tourism and the currency crisis.

Why is Egypt viewed by the world only through the pessimistic prism of negative events? To be sure, Egypt has had to bear the devastating effects from terrorism, political unrest and economic instability.  Its behavior on human rights efforts is far from exemplary, and the international media is raising the possibility of increased social unrest that could lead to an uprising at some point.  The government has been slow to embrace education reform with a holistic focus on critical thinking, math and science and other skills relevant to this century and essential to economic sustainability. Yet, the world is unaware of the positive, transformative developments occurring across the private, not-for-profit and government sectors, ones that are destined to provide the framework and opportunity for Egypt to flourish. These developments are fueling another kind of uprising.

{mosads}Entrepreneurs are not new to Egypt; nor are small businesses.  However, today’s massive youth population with access to technology, combined with a favorable regulatory environment and a relevant education system that feeds entrepreneurship, job creation and addresses market needs, can and will accelerate small business growth and the growth of the national economy. As Sherif Kamel, vice president for Information Management and former dean of the Business School at The American University of Cairo, noted aptly in the Economic Recovery and Revitalization report he co-authored with American venture capitalist Christopher Schroeder, “by creating the environment where an entrepreneur will thrive, you create the economic conditions for all to thrive.”

Ahmed El Alfi, chairman of Sawari Ventures, an Egypt-based venture capital firm he founded just six years ago, and a panelist at the Atlantic Council event, is an important example of how the private sector is leading the drive to promote sustainable businesses.  In the past three years his firm, through its start-up accelerator, Flat6 Labs, has launched 45 companies. CIB, Egypt’s largest private sector bank, launched its Business Banking group two years ago to address the needs of small and medium enterprises (SMEs). Not only does the bank provide financing to these businesses, but also provides customized services to help them grow. Most recently, CIB introduced Smart Wallet to afford small customers with the same quality of services as its larger ones. This digital banking effort has tremendous positive implications for financial inclusion in Egypt.

Not-for-profit organizations are equally important contributors to the movement. The American Chamber of Commerce Egypt has a vibrant, dedicated effort to support small businesses. In fact, they were a sponsor of the Rise Up Summit last December, the Middle East and Africa’s leading entrepreneurship event that attracted 5,000 entrepreneurs and innovators to Egypt.  Education for Employment’s (EFE) innovative high-impact youth employment solutions are influencing how governments, educators and businesses prepare youth to enter the workforce across the Middle East and North Africa.  With an impressive 85% placement rate, EFE’s Egypt affiliate has trained over 1,300 graduates as future change-makers and leaders in their companies, families, and communities. El Alfi’s online platform, Nafham (“We Understand” in Arabic) launched only two years ago, where parents and students can upload supplemental education videos, garners over 105,000 views per day. Over 36.5 million videos have been viewed, and the site averages 500,000 distinct monthly users. Established in 2013, The American University of Cairo’s Venture Lab incubates, connects and supports talented youth, giving them access to experienced mentors and facilitating their success.  Over 5,000 Egyptian and regional entrepreneurs have benefited from Venture Lab.

For its part, the government has begun the process to facilitate the success of small businesses.  While education reform is critical, and the regulatory and legal framework needs to be relaxed to give enterprises the freedom to succeed, important first steps have been made.  In a recent address to Parliament, President Sisi is looking to create jobs for young people by earmarking financing for SMEs, in addition to creating more investor-friendly regulations. And the Central Bank of Egypt has mandated all banks to allocate a percentage of their lending activities to SMEs.

By harnessing the efforts of these sectors to leverage the economic potential of a young population empowered by technology, there is every reason to view Egypt through an optimistic prism. The entities and individuals I have cited, and countless more, are making a difference and moving Egypt firmly forward. They are proving every day, that amidst the turmoil and economic uncertainty, progress is not only possible, it is a reality.

Burns is a managing director at Cambridge Global Advisors in Washington and a consultant to both private and not-for-profit organizations in Egypt.