The chairman and CEO of Orascom Investment Holding SAE, a holding company worth $1.75bn, oversees investment projects in telecom, media & technology, and cable businesses across Egypt and globally.
But the self-proclaimed ‘freedom fighter’ isn’t all about business. In a candid one-on-one with The Africa Report, he talks about his brief time in politics when he fought for his freedom and his willingness to do so for others, and why he feels Egypt has all the right to stand up to Ethiopia.
Presented here is a transcript, with light editing for clarity.
Coronavirus in Egypt
The Africa Report: How has Egypt been dealing with the health crisis?
Naguib Sawiris: Egypt has done exactly the same recommendations of the WHO from the beginning. Once the decision was to adopt a lock up, lock down, Egypt did this lockdown and started to take all the measures, they imported all the ventilators, they imported the testing. So they did actually a very good job and they increased the capacity of the hospitals and they dedicated some specialised hospitals for COVID. But all was done in the Egyptian rhythm not like a European style. But in the end, overall, I would give them on a scale of 10, 8. How they dealt with this crisis…many other countries in Africa were not so fortunate like us.
But you were quite vocal about the idea of suspending work for months, almost like a mini lockdown.
No, I was opposed to the lock down; an indefinite lockdown. I can understand when they locked down for one month, six weeks, because they needed first to figure out what is this disease and what is the measures and how is it transferred.
But after one year, they don’t know anything. And each scientist is coming with a new theory: Don’t stay two metres away, one metre is enough. No, three metres is better; It transfers through the air, no, it doesn’t transfer to the air.
In our homes, we’re not working as we should be working and not generating income and people will go…will die by hunger instead of dying by the corona because it’s not going to end or lock down will not serve much? It’s better to go back to work with all the precautions. We have the signs, we have the material when you walk in the room you have to sanitise your hands, we did all the air conditioning, we did all the offices, re-sanitised everything and people have been working [for about] two months and we [haven’t had] a single case.
How has the pandemic hit Egypt and from your vantage point in terms of development, tourism?
The worst, the worst segment, which has been hit hardest, is the hotels and the restaurants and cafes. Tourism has been hit so hard that hundreds and thousands of people lost their jobs or were underpaid now and many hotels are up for sale, [it’s] really very bad, because month after month after month, if you have to pay the staff, it’s like a million dollar, half a million dollars a month. And then there is no income. And this is the area which has been hit most.
Did COVID-19 push a lot of industries to become a lot more functional? So we’ll see perhaps a rise in Egypt’s manufacturing industry?
There are many factories that went into manufacturing disinfection machines and some other stuff; but all in all COVID is a disaster, it’s also a disaster in terms of reducing the productivity of everybody [and] working on the psychological effect of poisoning life. People are totally depressed, and they want to go back to their normal life. That’s a disaster. I hope we see an end to it.
Mining and Gold
How has COVID affected the value of gold? Do you think it’ll still maintain its high level?
You know, it was just not because of COVID that gold increased.[…]There is [the] starting of a conflict between China and America and China and the UK. In the Middle East, we have a war in anticipation between Egypt and Turkey, and maybe Egypt and Ethiopia, and [then] China attacked India, China is now trying to annex Hong Kong.
And Iran now is trying to promote its nuclear power, but it’s being thwarted by the US and the Europeans are in between.
So if you look at the geopolitical situation, it’s really bad. So gold reacts to all that as being a safe haven. So it’s not only the COVID.
So to answer your question, I’m still bullish about gold and I think it will continue to rise.
Are you still planning on launching the mining investment fund, La Mancha?
With this rise in gold and the rise of equity positions, I think we have decided that we will invest our own money through La Mancha instead of wasting time and going to other investors and so on, because we are very good in creating value. And I decided now that I would stick to… you know, La Mancha stock rose by 60%, so we have now surplus cash that we can use to invest on our own, without partnering. It’s easier and faster.
And what about the amalgamation Endeavour-Semafo, which I believe was just authorised by Canadian authorities? Could it be the future champion of Africa?
The merger has already been done. And we are now one company and the market cap of Endeavor is now four or 5.6 billion [rather than three], because Semafo is not listed. And we are now considered one of the largest miners in West Africa. So it gives you a good idea on how consolidation creates value. So we will continue with this path with Endeavor being our vehicle because our aspiration for Endeavor is to be the largest mining company in Africa.
Do you think the future in mining will be primarily funded through private equity?
No. [There are] also private investors like us who are very active and have an industrial angle, sometimes they invest the money but they don’t have the expertise on their own. They might get it but we believe we have the expertise now to be on our own: an investor and industrialist [at] the same time.
And are there any advantages to listing a mining company on the stock exchange?
Yes, of course, because you know, mining is a long term project. So you need at least six years of exploration until you can come to a bankable feasibility study then you need another two years to build the plant. So, on this trip you always need capital. And the best way to raise capital is through the equity markets and listing in a reputable destination like the US or Canada or London.
I think most recently you bought a 400 feddan (1,680,000 square metres) plot in new Cairo in the fifth settlement. What is your vision for Cairo or even for the country in terms of development and where it can keep growing?
You know, the demand, the offering of real estate units compared to demand is maybe 1 to 10 so the demand is 10 times bigger than the offering.
There is a problem also that the prices have risen so the lower segments of the market are now having a bigger difficulty because the prices have risen. But I believe that this segment will continue to grow because of this big gap between demand and offering. So we are now, as far as Cairo is concerned, we have no more ambition inside Cairo. But because we are into the two most wanted let’s say destinations in Sheik Zayed and Tagamoa [new Cairo], our next step would be to go to the north coast and do our development there. But the government is stalling on giving us the land because they have their own project.
So in terms of the new administrative capital, which has been going on for quite some time, do you have plans to invest in that?
You had mentioned earlier that gold, for example, its price evolves a lot based a lot on politics and what is happening in the world. When does politics prevent you personally from investing in something? I know you have a telecom license in North Korea, and it’s a government that maybe a lot of people won’t do business with. So how do you rectify that?
It’s like what happened to me in Algeria, when you have a corrupt government that decides that you as an investor are making too much money. So they go ahead and they block you and they give you a problem so they can take over your company, as a result [of] this case with me in Algeria, nobody’s invested in Algeria, because they didn’t realise that by raping the biggest investor in their country that came in good faith invested and built this empire of telecom company worth 14 billion [dollars], all the other investors will be scared to come.
And now as you see, they have all these government sessions with corruption because everybody who agreed to stay locally and work had to work within the system of corruption.
A bit like what happened to you in Canada because I remember there was a time when you had invested…
In Canada it’s the same thing. It was their competitors [have] their political links to the government. They just blocked us and ruined our investments, so the government took our money and didn’t protect us from unfair competition.
On your Twitter bio, you mention that you’re a freedom fighter. But what does that mean to you?
Freedom fighter means to me that I support, let’s say I support the people of Hong Kong against the attempt of China to quiet them down. I support the people of Kashmir because there are Muslims and they are being targeted by India and prevented from the simple rights of life. I fought against the Muslim Brotherhood in Egypt because they wanted to deny me my freedom of democracy and freedom.
So when I say I’m [a] freedom fighter, I go out of my way, and I risk my life and my wealth against people who are unfair and unjust…I am just a person who is willing to go out of his way and fight against injustice.
Is that why you created the Egyptian Freedom Party?
But it didn’t run in 2018. Do you think the next round it might be running?
No, no, I went out of politics completely. I’m out of politics completely [for] more than four-five years.
You grew up in an Egypt that was under [Gamal Abdel] Nasser when industrialism was at its peak when you have pan Arab Muslim, Pan Africanism Do you subscribe to either ideology?
Nasser is responsible for all the dismay of Egypt that we are suffering from today…because of his wrong policies and his adventures in Yemen and [the] attack in the 67 war [where] we lost our pride and we were humiliated. All these are his. He divided agricultural land into small pieces.
That’s why our agriculture today is 10% of what it should be. He nationalised all the factories and the companies so there [is] now bankruptcy…Nasser is a disaster.
As an Egyptian Coptic businessman, you’ve always mentioned that the church is quite important to you. But you’ve also said you are quite a big supporter of the separation of church and state, is that possible in Egypt?
It should be possible, why not? Because you know the church should remain as a religious entity.
About the GERD [Grand Ethiopian Renaissance Dam], what rights does Egypt have to it?
The Nile comes to us, the water comes to us through four or five African countries with which we – with the exception of one [of which] we have a bad relation with – the rest we have good relations. And if you look at Africa, Egypt is the North Pole. And South Africa is the South Pole.
You mentioned earlier a possible war between Egypt and Ethiopia, presumably over the dam. A few weekends ago, you circulated a petition entitled ‘Egyptians right to water of the Nile’. Do you think military action is feasible? Is that reasonable?
It’s not reasonable. But let me ask you a question. Imagine someone locks you in your house and suddenly you don’t have food and you’re out of food. There is no food because Egypt depends 100% on the Nile for its water. So someone decided to go out and close the tap. So suddenly, all your land agriculture dries up and your people are starting to die. So what can they do? Just watch themselves die? Or go fight for their right?
So if we are going to be blamed that we started a war against Ethiopia, the one who should be blamed is Ethiopia because they closed the tap, after years, hundreds of years of history from the pharaohs, the Nile….I personally as an Egyptian, I will vote for a war if they close the walls around us.
I had spoken to Adly Thoma, the CEO of Gemini Enterprises Africa and was impressed by the launch of the Gemini uplift initiative. But I wanted to know is it important for Orascom to have a presence in Africa?
This is done under purely charitable basis…So this is coming from my family office. It’s my contribution to Africa to try to promote more entrepreneurs in countries that we should try to develop like Sudan and South Sudan and any other, Uganda and Tanzania, all these countries and even Congo. So this is an initiative that has charitable social aims.
Which regions in Africa do you think need to have a bit more investment or have a lot of potential in the years to come?
Sudan and South Sudan, they are completely dry. And the reason for that is that people will not invest in countries that are not transparent or don’t have accountability or clear clarity for the investors and protection, you know.
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