WHEN: TODAY, THURSDAY, JANUARY 22ND
Following is the unofficial of a CNBC interview with Egyptian President Abdel Fattah Al-Sisi from the World Economic Forum in Davos, Switzerland. Excerpts of the interview will run throughout CNBC's Business Day programming. Following is a link to a story on CNBC.com: http://www.cnbc.com/id/102358338.
All references must be sourced to CNBC.
GAMBLE: Thank you for joining CNBC, a very exciting day the stock market hit a 6-year-high. I want to ask you about that in terms of investor confidence. Does that signal that the optimism is back in the market? The slump in oil prices, or true optimism on the economic agenda?
PRESIDENT AL-SISI: Allow me at the beginning to extend my best greetings to you and to your great audience. Thank you for doing this interview. In fact, the optimism that exists in Egypt because there is an overwhelming feeling of the Egyptians of hope. There is an overwhelming feeling amongst the Egyptians of stability and they also have a they also have a bit of feeling for the future, especially after a very critical time for the last four years. So this spirit is here and it will continue and it will get higher.
I'd like to say that this is a real invitation for all investors to come and invest in Egypt, there is great opportunity and potential in our country now.
GAMBLE: You said this is a new what do you mean by that?
PRESIDENT AL-SISI: The Egyptians took to the streets on the 25thof January 2011 because they wanted to change the reality and they wanted to make sure that we have a better future. We understand that it has been 4 years now, in this current state, but 4 years is not a big time in the life history of revolutions and for the Egyptians. Four years is not that long in the history. As I said in the beginning, we, and when I say 'we', we don't mean only the official statehood, but the people have this strong determination. We have seen the people one more time, on the 30thof June, 2013, when they took out to the streets in millions and millions that surprised the world. And the question why they went out one more time, in such a short stand of time, because they felt and they realised that change that happened before was taking them into a direction they did not want. So, that is why they took to the streets, to put themselves on the right track one more time. To put the compass on the right path. The new Egypt is Egypt of the civilisation, is Egypt a country of diversification, is Egypt that is in harmony with its immediate and broader worlds, the Arab and the international community with no conflict, with no criss-crossing of interests. This is the new Egypt.
GAMBLE: Perception is a very powerful thing, particularly when it comes to investor sentiment. Now overnight we did see some protests in Cairo around the anniversary of the 2011 protests, over the past year we've seen thousands of people detained and quite famously three al-Jazeera journalists are on trial in Egypt. Would you say those perceptions are justified? 081100
PRESIDENT AL-SISI: The media, it is the media that has been substantially contributing in to the creating of the perception and when the media addresses the reality of Egypt, it is important for the media to have an enlightened perspective of all the realities that take place on the ground in Egypt. Protesting is not the case but anarchy and disorder are very dangerous to the stability and security of the country, where 90 million people live. 90 million Egyptians need to have better standard of living.In order to deliver this, we need a substantial amount of stability and security. In the meantime, Egypt is in the midst of a ferocious war against terrorism, against extremism. So, in order to strike that balance between freedoms and the liberty to protest and the stability of that big country, this is a formula that is very significant and has to be taken into consideration when we look at the situation in Egypt.
GAMBLE: So, you're saying that the media needs to take an enlightened viewpoint of this, doesn't that necessitate that the media has access to the country and can talk to whomever they want and can be free to move about the country and can do interviews and hard hitting reports and things that could in fact change perceptions. Isn't that very important?
PRESIDENT AL-SISI: I quite understand the situation of Al-Jazeera journalists and hey are now being re-tried. I said it once before and I am reiterating now that, personally , if it was for me I would just send home a journalist who violates any laws, of the standards, or the norms, and call it a day and never have journalists to stand before court, regardless of how deeply involved, or not, and this unfortunately did not happen. Second point is, if we're talking about state institutions, if we're talking about the rule of law, there has to be a price that we have to pay that will have to pay. And that price perhaps sometimes gives a perception of discomfort, uncomfortable perception, just like one form of dealing with the journalists. I understand it has given an uncomfortable perception. But, again, the formula to make sure that we have statehood of institutions, to make sure that there is the rule of law. We need to do that in order to get a stable country, a stable Egypt, to get it on the right way to progress. Just like any other developed country in the whole world, we need to respect the institutions, we need not to intervene in the work of the judiciary. This is quite important to look at, at this critical time.
GAMBLE: So given that, how then do you change that perception, because western companies are interested in coming to Egypt, they do want to invest. But those things could be holding them back. So, how do you tackle that?
PRESIDENT AL-SISI: We are trying very hard, as a matter of fact, to address this case and other similar cases and we are trying to sort it out and find a way out within a legal framework and while, in the meantime preserving the rule of law and showing respect to the judiciary; this is one thing. The other thing is that an outstanding forum like yours and other similar forums and other similar programmes can send a very clear and honest message of the area where Egypt is part of. The Middle East area is suffering from turbulence, Egypt is one country within this context. If we read the Egyptian reality, within this mental frame, we will be able to send a real message that would give an authentic impression of what is happening in Egypt and the truth behind it; this is the real context that things should be interpreted. We don't need to only stress one story, one side of the story, and pose it over and over again to the audience. They need also to listen to the other story.
GAMBLE: Let's talk about the Egyptian economy. You took some major risks when you came to power, you cut fuel subsidies, something that's been a major drain on the economy for years. It was a big step. What other reforms are on the horizon?
PRESIDENT AL-SISI: Allow me first to use your forum to extend my thanks and appreciation to the Egyptians, to my people, for the rescue that you have just mentioned. As a matter of fact this decision, the size of decision, I felt was not that dangerous and that critical because I relied heavily on the awareness of the people. They realised and understood that tough decisions are targeting their interest, they share their understanding and they share their greatness, despite the simpleness of many of the Egyptians. Despite all of their difficult circumstances that they have been going through, the accepting the tough decisions. These are people of great awareness, people of greatness and that is why and for the sake of these people. We are asserting enormous effort in order to make sure that we create the right atmosphere for investment, to come up with unified investment law, to make sure that investors are working in harmony with all the procedures and formalities needed to make sure that investment does not face any debacles or quandaries. In the meantime, we are working to sort out the problems accumulated over the past 4 years with Egyptian Foreign and Arab investors. We have bene able to sort out a lot of these issues and we are working on that to terminate it totally.
We are coming forward with a group of integrated projects during the coming economic forum in Egypt, we are working hard to expedite and facilitate all of the procedures needed to obtaining permits and permissions. By all investors, local, Arab, or foreign investors, we want to tell them it won't take a lot of time, taking all the necessary actions to get your job established. Very importantly also, we are closing all loopholes, we are fighting corruption and very soon we will be able to terminate it completely.
GAMBLE: Mr President, you're not a politician and you're not an economist, you're a military man. How important is it going to be that the private sector take the lead in growing Egypt's economy?
PRESIDENT AL-SISI: The answer is simple. We are counting very heavily and working very vigorously in order to create very productive atmosphere for economic growth for the private sector, yes we have a public sector but all the focus and all the efforts are directed toward making sure investors can come to Egypt in a very attractive atmosphere and in a very investment friendly environment. Because we understand that in order to attain all the desired objectives of investment, it can't be achieved simply, unless we have private sector investors. We have investors from either Egypt, Arabs or foreign investors.
GAMBLE: Does that mean then putting an end to a regulatory environment, like capital controls?
PRESIDENT AL-SISI: The economic objectives that we are desiring are big and the start achievement of the objective is tough. Because we've been through a lot of economic problems, the least of which was the deficit and the national budget. But what we are working on now is that we are not adding any more to the obstacles before investors. As a matter of fact, we're trying to clear the way out for the investments and for businesses and we say to the investors 'please do not forget the social dimension while you are establishing your business in Egypt, while you're investing your money there. We're telling them you work with transparency. Make sure that you also care for the social dimensions of the people and then where I can get successful in our country.
GAMBLE: Just to follow on to that, because it is important, so no end to capital controls in the foreseeable future?
PRESIDENT AL-SISI: As a matter of fact, I cannot just get an absolute formula, something like black and white,. There has to be balance there has to be an equilibrium how we address the economic issues and how we ,ale sure that we are progressing economically and enhancing the economy. I believe that this answer is the only one that is consistent with the realities and the issues we are facing in Egypt.
We have also to bear in concentration that we cannot just do it, once and for all, we cannot just have a quantum leap without taking into consideration all of the particularities of the Egyptian economy and the Egyptian community as well. It takes time. But meanwhile, we have to strike a form of balance between control and getting people successful and getting things clear and free.
GAMBLE: I want to talk about the depreciating pound, you've been auctioning dollars to depreciate the currency. Are you satisfied with that progress so far and could we see an accelerated depreciation going forward?
PRESIDENT AL-SISI: We are exerting a (inaudible) to ensure we are keeping the Egyptian pound with suitable value with an appropriate value in the face of the hot currency of the dollar. Because the devaluing of the Egyptian Pound has its negative effect on the soaring prices inside Egypt. We also need to know that the hot currency that comes in to Egypt comes from various sources, including the Suez Canal, including the exportation, including the Egyptian Bank (inaudible), Egyptians who live abroad, and they transfer the money into the Egyptian Banks. And also from tourism. We need to admit also that the last 4 years witnessed and recovered state of tourism and that had its impact on the value of the national currency and it had its effect in devaluing the Egyptian Pound in front of the dollar. But let me link this with how the media and how the journalists can see things and can delineate the picture in Egypt. When they come into Egypt and find procedures taken like this, they need to understand that we are trying to strike a balance between the stability and the liberties and that is very critical in the circumstances. And making sure we are trying to provide good living standards for a big population; 90 million people that have been under the impact of tourism decrease and the soaring prices. We are trying to get stability back so that tourism can be further encouraged and the hot currency can be pulled in to the country one more time and lift the pressures. The economic pressures off the shoulders of the Egyptians.
GAMBLE: NOW for your economic plans to work, you're going to need billions of dollars and investment. Where is that money going to come from? Is it going to come from the Gulf States? And also , Secretary of State John Kerry will be arriving tomorrow. What is your message for him, especially in light of what we're seeing in terms of the fight against the Islamic State and also the terror attacks that we saw just a few weeks ago in Paris?
PRESIDENT AL-SISI: I will answer your question in two main lines; one and a half years ago, we warned our friends, we said look at the map of tourism in our region and look how expensive this map was getting and we also warned the foreign fighters that were being put in from all over the world to Syria. We shared that with our friends and on top of whom they are the American friends, we said that we must be mindful and cautious of what is happening and unfortunately what we alarmed against happened already. I just want to say one thing; Egypt is the bedrock of stability in the Middle East and this is the message that the whole world needs to listen and understand. It also needs to help us maintain the cornerstone of stability in the region. The continuity of Egypt capable to stand on its feet, capable to face all the challenges that has been undergoing is only an indication of the whole region to stand up to the challenges that it is confronting. This has been shared with our European friends and our American friends. We has a very big delegation from the United States, perhaps one of the biggest delegations from the United States, in Egypt. We have also received similar business delegations from European countries and the message that I shared with them very clearly that when you stand with Egypt and invest in Egypt, you are not only investing money or trying to get to recover the economic health. But you are also investing in enhancing the stability of Egypt and subsequently, in the Middle East and in the world.
GAMBLE: Mr President thank you so much for joining CNBC.
PRESIDENT AL-SISI: It is pleasure me to be with you and with your audience and thank you very much for you and them to.
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