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Economic growth, high standard of living depend on SMEs expansion: Abdeen - Daily News Egypt

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Economic growth, high standard of living depend on SMEs expansion: Abdeen

Banks working to accelerate production, achieve sustainable development by focusing on funding vital sectors such as industry, agriculture, renewable energy


Mohamed Nasr Abdeen, vice chairperson of Union National Bank-Egypt, said that economic growth and achieving a high standard of living for citizens in Egypt depend on the expansion of small and medium enterprises (SMEs), which absorb more workers and raise productivity.

This interview examines the outlook for the performance of the Egyptian economy and the banking sector in the new year 2018.

What is the role that banks can play in supporting investors during the new year?

Banks operating in the Egyptian market have a large volume of deposits, in addition to the banking expertise and the confidence of international financial institutions.

In addition, all banks are ready to finance various development projects, where they have a huge budget that makes them thirsty to finance investment projects, especially if they enjoy competitive advantages and a rewarding return, such as the projects of the Suez Canal Economic Zone.

However, it is necessary to reduce the cost of financing to help investors bear the burden of their investments and achieve profitable returns.

What are the most important sectors that the bank will focus on financing?

We are working to accelerate production and achieve sustainable development by focusing on vital sectors such as manufacturing, agriculture, and renewable energy, which will give a strong boost to the Egyptian economy.

In addition, we have an interest in financing SMEs. This sector represents a fundamental pillar, which helps to create employment opportunities for young people, reduce unemployment rates, and raise levels of income, in addition to increasing the GDP, stimulating Egyptian exports abroad, and limiting the import of alternative goods.

What is the bank’s action plan in the Egyptian market during the coming period?

The Union National Bank – Egypt will see a great start during the coming period. We eye a market share of over 5% in the next 10 years, next to increasing profits this year.

To do so, we are relying on an approved plan, which focuses on developing the means of reaching customers by offering a range of new products and services to suit different segments, and completing the expansion and geographical spread through the opening of five new branches during the current year to reach 48 branches in total.

The bank is also very interested in the SMEs sector, which accounts for 10% of the bank’s total loan portfolio at present. The bank is seeking to reach 20% over the next three years.

What are your expectations for inflation and interest rate trends in 2018?

The Central Bank of Egypt (CBE) has gradually succeeded in targeting inflation. The last three months witnessed a significant slowdown in rates. The basic inflation index prepared by the CBE settled at 19.86% at the end of December 2017. The interest rates are up to the CBE, though, it being the monetary policymaker.

What is your view of the future of the foreign exchange reserves and the ability of the CBE to meet external commitments?

The CBE was able to pay its external dues on time without delay or postponement.

Despite the difficulties facing the Egyptian economy, the CBE pays annual premiums, debts, and deposits to countries and international financial institutions, as a result of a prudent monetary policy to maintain foreign exchange reserves and even rise to record levels. Furthermore, the CBE took several actions to limit the erosion of the reserves, which is an excellent indicator of efficient performance and ability to meet external obligations.

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https://wwww.dailynewssegypt.com/2018/01/21/economic-growth-high-standard-living-depend-smes-expansion-abdeen/
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