By Lubna Hamdan
Egyptian billionaire says the devil is in the details when it comes to commercial disputes in the kingdom
Egyptian billionaire and telco tycoon Naguib Sawiris fears investing in Saudi Arabia due to its lack of clear investment laws and commercials courts.
Speaking to Arabian Business, the executive chairman and CEO of investment conglomerate Orascom Investment Holding (OIH) said establishing commercial courts is particularly essential in case of disputes.
“There needs to be a clear investment law; all the incentives you’re going to give to investors, and we need to have commercial courts in case there is a dispute. There’s still this big fear in the minds of investors where in the past, if you had a problem with your Saudi partner, if he was a Prince or related [to the royal family], he would just take the money and kick you out.
“This has changed and people trust the Crown Prince [Mohammed bin Salman] but they need to see everything they see in every single other investment jurisdiction… It’s moving fast but I haven’t seen the details. The devil is in the details,” he said.
Sawiris, who is known for transforming the telecoms industry across the MENA region through Orascom Telecoms, is optimistic about the reforms taking place in the kingdom, including the issuance of tourist visas, but said he will not invest in the country just yet.
“The fact that the Crown Prince has broken the ice and has opened up the country like that will have a lot of positive consequences so the movie industry will strive in Saudi Arabia, tourism will strive for sure.
“Saudi Arabia is issuing tourist visas and they’ve allowed European women who come not to be forced to wear a burqa, which is a magnificent step because it breaks down this taboo. [But if] you expect me to come and be forced to change my style if I want to see your country then I don’t want to see it,” he said.
The Egyptian Christian recalled getting “beaten up with a stick” by a man in the kingdom for not attending Muslim prayers.
He said: “It happened to me when I was in Jeddah. By the time I explained to the guy that I am Christian, he couldn’t believe it. He said, ‘You’re Egyptian?’ I said, ‘Yes’. He said, ‘How come you’re Christian?’ I said, ‘We have 50 million Christians [in Egypt] and I don’t go to church. You want to also hit me because I don’t go to church?’”
Sawiris, who is also the chairman of private natural resource investment company La Mancha Holding, which boasts equity investments in Evolution Mining, Endeavour Mining and Golden Star Resources, said Egypt is also guilty of vague laws, citing the country’s new mining regulation aimed at attracting foreign investors.
“In Egypt, they’re [introducing] the new mining law… [But if] you start to look for the most important things: how much is the royalty fee, how much are the customs and how much are the taxes – they’re not there,” he said.
“I ask, ‘Mr Minister, what shall I do with this?’ He says, ‘Oh, we’re writing this now’. So when you reached the law, why didn’t you write the executive paper with it? Before you go and slam people with something, give them the details. They want to work.
“I mean the private sector is always faster than government. They are ready to move. When they smell money, they are ready to work. But it’s the other side that’s always late. And then they blame me when I invest outside. Oh why are you investing outside your country? I tried to invest in my country,” he said.
While inadequate laws will put him off investing in countries like Saudi Arabia, Sawiris said political tensions in the Middle East have not stopped him from pumping money into projects across the troubled region.
“[Political tensions] don’t put me off investing because as long as we don’t have any democratic stable rule of law in our area, it will always remain an area like that and if you are from the area, you are used to working under these conditions…”
Sawiris is no stranger to Egypt’s political affairs. In the wake of the 2011 Egyptian revolution, he co-founded the Free Egyptians Party in hopes of advocating a secular and free-market opposed to Islamist parties, but famously received death threats following the election of former President Mohamed Morsi and was forced to leave the country until 2013.
While he’s taken a back seat to the political party he co-founded, he said the Egyptian government should focus on eradicating poverty and improving healthcare and education.
“We have to have a programme to fight poverty. This has not taken priority… It’s unacceptable that such a rich country like Egypt which has all the recourses… we are able to sustain everybody, so we should have a big aggressive program to eradicate poverty. This should be our first priority; poverty, education and healthcare. It’s not been taken seriously enough,” he said.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.