Egypt's prominent role in geopolitics stems from its strategic location, with the Suez Canal (“the vital route”) connecting the Red Sea to the Mediterranean. Egypt has historically been a peacemaker in the region, thanks to its undeniable influence in the Arab world and the size of its population, the sixteenth most populous country worldwide with almost 79 million people.
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The political storms which are still affecting the Mediterranean area should not stifle the good news: after two very difficult years of struggles on the political and global economic fronts, 2012 was an excellent year for the re-gion in terms of FDI attraction - the fourth best in the last decade.
Indeed, with 37 billion euros of FDI announced in 2012, the MED countries have reached their pre-2008 crisis levels. All countries, except for Syria, record very encouraging results, thanks to, among other factors, some spectacular deals announced in Algeria, Egypt and Turkey. Yet, the region is changing: the transitions seem to have induced a redistribution of investment sources. Europe is dramatically losing its leadership (it only contributed to 26% of the invested amounts in 2012) to the benefit of emerging countries which are demonstrating a growing interested for the region's potential. The Gulf countries, increasingly willing to support the new governments, have initia-ted their comeback and resumed the implementation of the large real estate and banking projects they had put on hold in 2010.
Wouldn’t European com-panies be losing a valuable relay for growth by withdrawing at this strategic time from the Mediterranean area and the access it is offering to African markets?Download the doc
Despite the exceptional political situation in the Mediterranean, the figures for 2012 FDI are rather hopeful, and the region is showing a good resilience capacity. Indeed 2012 is the fourth best year since the last decade, in amounts of FDI announced. Except Syria, all the Southern and Eastern Mediterranean countries are back to business in 2012, and most of them managed to increase their average FDI project size which was in constant diminution since 2006.
Despite the fact that the position of foreign operators is still volatile, it seems that Europe has lost its supremacy in the Mediterranean over the last two years. For the first time in 2012, the BRIC countries take the lead in terms of amounts invested in the Mediterranean, and the Gulf which had abandoned the Mediterranean since 2007, invested as much as Europe last year. In times where the Mediterranean partner countries are in the process of reinventing their development and governance models, based on new democratic values, a retreat of the Europeans would be both a strategic misapprehension and a misunderstanding of the expectations of the Mediterranean countries vis a vis their historic partner.