Zoheir Garranah Minister of Tourism

P.M. Communications: Since you have been appointed Minister of Tourism in 2005, the government has implemented reforms that have contributed to a 6.9% rise in GDP and 9.4% increase in Foreign Direct Investments. Please give us your insight into the progress of the reforms and their impact on the tourism industry in particular?

H.E. Mr. Zoheir Garranah: The Egyptian government has embarked on very strong economic reforms as far as taxes and customs are concerned. After the end of the fiscal year the results are much clearer; although the Egyptian government had expected a 12% deficit on tax revenue, instead we ended up with a 17% growth.

Concerning the GDP, we are maintaining a growth rate of 6.9%. Our target is to reach 8%. As far as tourism is concerned, it is an ever-growing industry and everybody is focusing on it. The main reason for that is the fact that tourism is a labour-intensive industry and one of our main concerns is the creation of jobs. Recent statistics have shown that every million of tourists who come to Egypt, generate 200,000 new jobs directly and indirectly.

Our plan is to reach 14 million tourists by 2011, and generate 140 million room nights. We also want to reach 240,000 hotel rooms. As we speak today, Egypt has 175,000 rooms and we aim to increase that by an additional 15,000 rooms every year. During the past fiscal year, we have added 16,000 hotel rooms... So as far as rooms are concerned, we are doing just fine!

In order to reach the figure of 14 million tourists in 2011, we have to sustain an average growth rate of 10% per year. As you know, growth rates can vary from year to year. For example, we achieved a phenomenal growth rate of 33% in 2004 (versus 2003). This is unheard of, but it can happen.

As far as 2006 is concerned, we expect to close the year with a 5-6% growth rate , this is an excellent result given that the WTO expects the global growth rate to be between 4 and 4.5% so we have managed to exceed the global average once again.

P.M. Communications: Given the new trends on the global tourism market and the ever-increasing demands of modern travellers for new and unique products; how important is the diversification of the tourism offer in order to reach your target of 14 million tourists?

H.E. Mr. Zoheir Garranah: I like thinking of Egypt as God's gift to the world. Our main advantage is that we have a product that no other country can compete against: a tourist can definitely find the sun, the sea, the sand, clean water, and even good weather in many places, but nobody has the pyramids! This is a very solid ground that we stand on.

Nevertheless, there are limits to the potential growth that can be achieved within the cultural segment, because irresponsible over-development in this segment can endanger our monuments. It is both our duty, and our responsibility, to protect Egypt's historical sites and to preserve them for future generations of all nations. So, although cultural tourism will always be a big part of Egypt's attractiveness, it will probably never exceed 15%-20% of our total business.

Our real potential for growth in the tourism industry lies within the leisure segment. That is why over the past 15 years, we have entered the resort/beach segment. We started developing our resorts and introducing new products. For instance, we have the White Desert (located in the Northwest of Egypt) that you will not find anywhere else. We also started promoting our oases and focusing more on the MICE segment.

We have changed the property law, in order to allow foreigners to own houses in Egypt. In the past, it was very difficult for them to own a house in Egypt. But today foreigners are treated exactly like Egyptians, they can buy and sell whenever they want and own as many properties as they want. They can register a property and sell it the next day if they want, whereas in the past they couldn't sell it before 5 years. In the past you could also not use your property for commercial purposes or rent it, but now you can do that.

Since the British are known to be the biggest buyers of second home properties worldwide, they will certainly recognize the real estate opportunities now available in Egypt. Whereas they traditionally bought in Spain, Switzerland, or the South of France; Egypt now offers a new - and as yet undiscovered - location, which will offer exceptional return on investment.

In addition, the UK is the only country that has daily direct flights to our main resorts. The British can flight directly to Sharm El Sheikh, Hurghada, Alamein, and Luxor, which is a key element for the development of residential tourism.

Egypt is also developing more and more its marinas and yachting sectors. Many of the old rules and restrictions that had stifled this sector in the past have now been removed and simplified in order to help the growth of this segment.

Another very attractive draw for British visitors in particular, is that over the last 7 years, we have developed 18 golf courses and there are more to come. Actually, Egypt has been awarded the prize for the "Best Undiscovered Golf Destination in the World" last year.

Within our focus on the leisure tourism segment, we are specifically working on improving the shopping offer in Egypt. In this matter we are collaborating strongly with the Ministers of Finance, Trade and Industry. Tourists like to have a pleasant and unique shopping environment even if they are not necessarily going to buy anything, and everyone loves to take back a souvenir from any trip. Travellers also look for good restaurants and quality entertainment places. These are the issues on which we have to concentrate in the near future in order to be able to offer good entertainment spots, good restaurants and good shopping malls. Fully integrated commercial centers, such as City Stars for example, attract a large number of visitors and the high occupancy rate of the Intercontinental hotel at City Stars demonstrates this. This is what we are trying to do, and the diversity of the products that we offer will make us even more competitive.

P.M. Communications: The new property law is having a strong impact on the construction developments in the tourism industry. Could you tell us about the main projects that are currently being developed?

H.E. Mr. Zoheir Garranah: Fully integrated resort development projects have proven to pay back on the long run. We have very good examples like El Gouna in the North of Hurghada. Another successful development is also Soma Bay to the South of Hurghada.

Moreover, integrated resort developments made by El Kharafi Group in Port Ghalib and Marsa Alam are making a landmark out of this destination and creating a new boom. They studied the market and put the proper accommodation, marina, golf courses, shopping malls, residential apartments, studios, venues for entertainment, and hotels in one place. It is a unique, virgin area with a beautiful sea and unbelievable corals. What else can a tourist ask for?

As far as the Mediterranean coastline development is concerned, we needed a new product to come into the market. We have the Red Sea resorts, the Nile Valley, the heritage, and we wanted to compete on the Mediterranean. This year two proper new hotels have been built at Port Marina and Almaz. Now Emmar, one of the largest developers in the Middle East, has chosen to develop Sidi Abd El Rahman in a historically well-known area, El Alamein, where they will build 3.600 rooms, plus residential apartments. They are constructing everything that a tourist needs and are developing their own destination. This is why in Egypt our policy for the coming years is to assign big plots for fully integrated resort development projects.

P.M. Communications: The UK is the largest non-Arab investor in Egypt. The reforms and more specifically, the new investment and tax law are opening the doors for new opportunities. Could you highlight for British investors the most attractive investment opportunities in the tourism sector?

H.E. Mr. Zoheir Garranah: For the past two years, Egypt has adopted a new policy of facilitating foreign direct investment, and we are strongly committed to the reforms necessary to make this happen. In fact, the government's new slogan is "Open for business". With regards to the UK market, many significant British companies are already operating and investing in Egypt. Our FDI has increased from 2 billion to 6 billion US dollars (since… to…), and our target for next year is to reach 8 billion dollars of FDI.

As far as investors are concerned, the opportunities are unlimited. I am sure that all the big investors know where to look and have Egypt included in their plans. The Egyptian government is welcoming everybody and making efforts to facilitate their activities in Egypt.

P.M. Communications: Tourism has suffered from brutal terrorist attacks worldwide. Nevertheless, the number of visitors coming to Egypt has been continuously growing, which proves the capacity of the Egypt to quickly bounce back from disasters. What measures are you implementing to assure the safety and security of the travellers?

H.E. Mr. Zoheir Garranah: The number of arrivals from the UK has grown 32% since the beginning of 2006. The UK tourists are the number one tourists coming to Egypt this year and I think we will sustain this growth for the foreseeable future. In fact, we are hoping that visitors from the UK alone will cross the 1 million visitor mark this year !

The safety and security of our visitors in Egypt is our utmost priority and we spare no effort or expense towards that end. However, because of the tragic incidents that have taken place in the past years, the Egyptian government has raised its security levels and we take the safety and security of both tourists and Egyptians very seriously.

Unfortunately, terrorism is a global problem that most countries have to deal with. These attacks are now taking place everywhere: in the US, in Europe, in Asia, and in Africa. If the security could be assured 100%, then the crime rate would have been zero today! These terrorists are cowardly people trying to control our lives, and if we allow these attacks to affect or dictate how we live our lives (and where we choose to go for vacation), then they will have succeeded in their goals.

P.M. Communications: In Europe there are many misconceptions about the Arab World. How important is the role of tourism as a vehicle for cultivating tolerance?

H.E. Mr. Zoheir Garranah: Travelling is the best way for people to explore foreign cultures and to overcome any initial misconceptions and prejudices which they may have. It is the quickest way to bring people together, and to allow them to discover different religions, foreign traditions and ways of life. Travelling cultivates tolerance and shows people just how similar we all are, after all.

P.M. Communications: Next month you will be attending Last month you attended the World Travel Market in London. It is a great opportunity to network, negotiate, do business, and get updated on the latest developments in the travel industry. What are your observations expectations from your trip to London?

H.E. Mr. Zoheir Garranah: Trade fairs are not only important for commercial reasons, but they are also an excellent opportunity to exchange ideas, do P.R. and discover the latest trends and developments in the global tourism market.

Our participation in the WTM is was very important to us because the British market is crucial for Egypt and it is where we see great potential for growth in the coming years. British people are very sophisticated, and we want them to enjoy their stay in our country. I believe that anyone who is on a hard-earned vacation is entitled to be demanding. We have been implementing a lot of rules and regulations to upgrade the services that we are offering to our British visitors. This could be achieved for instance by putting special badges or certificates of excellence and we are working on that.

I will also take the opportunity to thank the British tour operators for their continuous support, as well as the press, which plays a very important role in informing the general public about any particular destination.

P.M. Communication: Would you like to send a final message to the 2 million readers of The Telegraph?

H.E. Mr. Zoheir Garranah: I only want say one thing to the British people: I hope to see you in Egypt soon!