The UAE’s Al-Futtaim Group plans to invest up to $1 billion in Egypt over the next three years, the North African country's Cabinet said on Thursday.
Chief executive Omar Al-Futtaim made the commitment in a meeting with Egyptian Prime Minister Mostafa Madbouly and other government officials in Cairo on Wednesday.
The Dubai-based conglomerate has been present in the Egyptian market for about 40 years, Mr Al-Futtaim said, calling Egypt “his second country”.
The Egyptian government seeks to enhance the role of the private sector over the coming years and improve procedures in a bid to attract foreign investments, Mr Madbouly said.
The Arab world’s most populous country is facing several challenges due to the economic fallout of the Russia-Ukraine war. These include a higher import bill, a rising budget deficit, surging inflation and a depreciating currency.
Last month, Mr Madbouly outlined a plan to attract $40bn in investment over the next four years by selling state assets to private investors, as well as increase private investment to 65 per cent of Egypt's total investment, from about 30 per cent, within three years.
Egypt has raised interest rates twice since March in an attempt to reign in double-digit inflation and win back foreign investors after the flight of about $20bn in “hot” money owing to uncertainty.
Gulf countries, including the UAE, have stepped up their financial support to Egypt in recent months.
Abu Dhabi state holding company ADQ spent about $1.8bn in April to acquire stakes in five publicly listed Egyptian businesses, as part of the company's $20bn joint strategic investment platform with The Sovereign Fund of Egypt that was set up in 2019.
Egypt, Jordan and the UAE signed an industrial partnership earlier this week to build sustainable economic growth across five sectors in the three countries. ADQ will manage a $10bn investment fund to quickly realise the partnership objectives.
Mr Al-Futtaim, whose billionaire father Abdulla Al-Futtaim owns the family business, said he was optimistic about the partnership and the Egyptian government’s support for the private sector, despite challenges.
Established in the 1930s as a trading business, the Al-Futtaim group later split business interests between Abdulla Al-Futtaim and his cousin Majid, the late founder of Majid Al Futtaim.
The group operates five divisions — automotive, retail, property, financial services and health — across 20 countries.
In the UAE, Al-Futtaim Automotive is one of the country’s main vehicle distributors and has been the sole distributor for Toyota for more than six decades.
The group’s retail franchise brands include Ikea, Ace Hardware, Marks & Spencer and ToysRUs, and its real estate developments include Dubai Festival City.
Assets in Egypt include Cairo Festival City and Cairo Festival City Mall, along with top retail shops such as Ikea and Marks & Spencer.
The group also distributes Toyota and Honda cars, and offers financial services through Orient Insurance.