Frontier tech, infrastructure, and new industries could reshape MENA economies but will bold growth strategies withstand global uncertainties?
At Davos, leaders from Egypt, Bahrain, banking and real estate framed regional prosperity as inseparable from stability, while arguing that technology and human capital will determine which economies pull ahead. On President Trump’s new “Board of Peace,” Egypt’s finance minister Ahmed Kouchouk called it “a step in the right direction,” citing tangible economic costs of war: reduced Suez traffic and a higher regional risk premium. Bahrain’s Noor Ali Alkhulaif said the region is “hungry for peace,” urging momentum and pragmatism: “Do we have another better option?” Panelists also questioned multilateral efficacy; banker Hisham Ezz-Al-Arab asked, “Where is the United Nation?” and argued initiatives that “shake” the system could catalyze reform, while emphasizing that success should be measured by whether Gazans “feel a better improvement in their living condition.”
On Gaza reconstruction, private capital was described as execution-ready but dependent on payors. DAMAC’s Hussain Sajwani said contractors “have to be paid,” with donations insufficient for scale.
Turning to growth, speakers warned of an AI-driven “two-speed” Middle East. Egypt is training 800,000 people annually and used AI-enabled compliance to raise tax revenues 35% “without increasing tax rates.” Bahrain emphasized regulatory advantage, data laws, and becoming an AI “testbed.” The key reforms: “education, education, education,” pro-innovation rules, and a stronger work ethic.
Well, ladies and gentlemen, a warm welcome into the room. And welcome to this World Economic Forum special event. My name is Dan Murphy from CNBC, and I'm absolutely thrilled you can join us in the room today for what is a really, really important conversation here at the forum. Given the developments of the last couple of hours. So let me start with the news that's dominating Davos today. As you've heard here at the World Economic Forum, US President Donald Trump has just unveiled his so-called Board of Peace, declaring that the war in Gaza is, in his words, really coming to an end. The board was meant to originally oversee Gaza's reconstruction, but it now has a much wider global remit. Of course, in line with the president's peace and prosperity agenda. Six Middle Eastern governments are on board, including some of those represented on stage here today. But as you've probably heard, most major European economies are not so on stage. Here to discuss this are leaders from government, finance and private capital across the region for reaction and analysis. So let's take a deep dive into what this means for the region, what it means for peace and prosperity moving forward, and ultimately what it means for your countries and your businesses as well. Joining me on stage is Ahmed Kuchuk, the Minister of Finance of Egypt, Nor Ali Al-Khelaifi, his Minister of Sustainable Development of Bahrain and the chief executive of the Bahrain Economic Development Board. Hisham Azab is chief executive officer of the Commercial International Bank of Egypt, and Hussain Sajwani is the founder and chairman of Damac. So, Ahmed, I'll start with you. What's your view on the Board of Peace? And is it a credible pathway to stability?
Well, it's, it's definitely a step in the right direction. I can speak from a very practical point of view. I will even, not even mention politics. But as a minister of finance, I have been suffering over the last couple of years, I felt it, I felt it through lower traffic, through the Suez Canal Zone transit. I felt it through, the higher premium that we were paying because investors in general were putting more premium for the region. I felt that when a lot of, prospects could have been improved, but because of that, there was a lot of in terms of ratings, in terms of assessment by investors. So of course, Gaza and Palestine is the core problem of the region. And if this is solved or improved significantly, that will have a huge dividends for the entire region, not only for close neighbors like Egypt, but for everybody. And I think it will facilitate more trade, more investment, which means more, economic growth and more ability for us as a region, to do more together as a region to attract a decent share of existing capital. We have everything. So I think it's a very positive move. We hope that it will succeed. And Egypt, of course, is part of, of the board and, and of course, beyond that, we have been very active and we have been very persistent and very, also clear about our position from day one. So we're very we are very happy that we're moving to, to a new to a new start. And we're hoping it will work. We put all our efforts there, Minister.
Thank you. Know, what's your view?
Of course we're we're proud and honored to have received the invitation to become one of the founding members of the board. And it was an honor for me personally to be sitting this morning and witnessing the signing and having His Highness Sheikh Isa bin Salman Al Khalifa, who is the Minister of the Prime Minister's Court, signing on behalf of His Majesty the King, and actually the first to sign to sign as a member and as a founding member of the board. This comes as the next step in Bahrain's support for the peace plan. And really, it's in line with what you see in the region. The region is hungry for peace. The region clearly through the economic development plans that you hear, the strategies, the visions, the region wants to focus on economic development, which ultimately will benefit its citizens and the people that live in the region. And so supporting any plan that could get us there is something that that's definitely in line with Bahrain's strategies and plans.
Thank you. Let's get a private sector perspective as well. Hisham, what's your view?
Well, I if you deal with money, you cannot talk about politics, okay?
That's why.
There's government.
And private sector.
Okay. Or football. Okay. You cannot take a side. So because I deal with money. But anyhow I'll tell you my personal view about President Trump initiative. I was saying all the time I adore his vocal. I respect that that makes life much easier. And I would love to as a CEO, being vocal and transparent, much easier to deal with. And in a more serious note, the hotspots in the world never been as high as it is now since the Second World War. And that tells me there is an issue or a challenge with the current structure of the United Nation. Okay, this is a nutshell. Any reform or any change, to reduce the hotspots or eliminate them is always welcomed.
Thank you, Chairman Sajwani.
Thank you very much. As you appreciate, in the region, we suffered with a lot of wars. So anything peace I'm sure is a music to everybody's here and we love to see this initiative succeed. And the region needs that. The people in Gaza need that. And I hope and I wish the reconstruct that area. I mean, when you watch a TV, how they're living, it's it's something really hard break your heart breaks for what you see. So I hope it works.
Well said. Let's talk about some of the challenges, though obviously, the absence of the major European economies has raised some concerns as well. It seems as if there's still some pathway to go before the board receives full, recognition, at least from some of the major European players in other countries outside of Europe as well. At the same time, there's also a view emerging in some of the post board signing analysis that this could potentially challenge the UN system. And I'm wondering if the panel has a view on that as well. Is this peace board a direct challenge to the UN system? Hisham.
For me it could be a challenge to reform. Okay, because you have a problem. You cannot hide your head on the sand. We all agree that the hotspots in the world at the highest it has been ever since the Second World War, then that means you have your system. There is a glitch there. Something has to happen. That initiative could really shake it and come up with something even better for us. What we are looking for is prosperity and peace. Okay? It's not how you position yourself here or there. Honestly, I look around Egypt as well. And what happened in Gaza? What happens in the West Bank, what happens in Sudan? What happens in Yemen and Libya? Where is the United Nation? Okay, as a humble citizen, I have big question mark.
I think if you allow me, I'll just say that, I don't think we should there should be a question or a doubt around around. Is this taking this place? The really the question is do we have another better option? And that's what I've been hearing over the last couple of days, is unless someone has a better option than the one on the table at the moment, which has quite wide consensus from the region, I believe we should go ahead with that, with that and give it a chance. Let it succeed. And then what you can see is people want the momentum is really good. There is already plans for for the next step in that board and what it will do bringing in the private sector and the government. And once we see that action, probably more people will come on board. But I think giving peace a chance is what the region needs.
Minister, you'd agree with that.
I would agree that the entire focus, even the entire question, should be on the people of Gaza. The success of that would be they feel a better improvement in their living condition. They feel the better prospects. So let's focus on that. That should be our own metrics, regardless of any institutional setup, if people of Gaza feel a much better life, a better hope, a much better future, and they can see it significant improvement there, then this would be, of course, a success. So it is all about the people of Gaza then, for the entire Palestine state. So let's hope that this would contribute to, this positive improvement in the living conditions and in their prospects.
Minister, just to expand a little bit further on what you're talking about here. As I understand it, Egypt already has this $53 billion plan when it comes to the reconstruction of Gaza. Looking at Egypt's own finances, though, obviously the math isn't necessarily adding up at the moment. What we see inside Egypt is the interest payments on debt alone being more than what the country spends on healthcare and education combined. Right. So does Egypt actually have the financial wherewithal to contribute in a deeper way to Gaza's reconstruction?
Well, Egypt has first of all, I think we are also at the same time, we're running one of the highest primary surpluses in the world. We are we have a much higher over the last two years, improvement in our tax collection, in revenue collection. But, you know, always interest rate is a lagging indicator. Once it's improved this year, it will have an impact next year. So I think you will see a lot of improvement in the coming years. But beyond beyond the the address to your question, I think Egypt has a lot of capabilities. In terms of construction in general, we have been able to over the last eight years in our country, develop more than 12 new cities and, have huge urbanization happening in Egypt. So we have the abilities, we can contribute with very dedicated firms, with very capable firms who have, of course, the proximity. We have a lot of the inputs and resources for that. So but that's that's a question ahead of ahead of the game. The idea here is to have, first of all, a functioning, system there and to see what is needed for the people of Gaza and that then we can discuss what is next.
So start with the dialogue, then the conversation on where to financially deploy follows. Okay. Hisham, over to you on this as well. From a banking perspective, Gaza reconstruction also being discussed here at a private sector level. Would you say that is realistic? And is there any bank out there right now worldwide who would actually be willing to help to refinance projects inside Gaza? If we saw the dialogue that the minister is talking about actually advancing?
I was not prepared for this question, but I will answer you. Okay. We as banks look at viability of the project, we do business in different countries. We finance transactions. For example, we have an operation in Kenya. We invest with our subsidiary there. And in Kenya, the as long as you have a piece somewhere, not it's not a war zone and you have a viable project. Definitely. Banks. Our there is one thing that I want to explain here about banks, because banks worldwide, they have been under attack by perception. Perception that banks, they make too much money. Good. But we pay tax as well, correct. Yeah. But the idea here that money we make large part of it goes into our capital. And without growing your capital, you cannot grow your business. If you stop making money, you'll become stagnant. And that's risk for the economy. In fact, banks should be pampered to make more money. And the more money you make, the more capital you're going to have, the more risk appetite you have to finance more, and then you grow the economy. Without your contribution to the community. Either that community is a project in Gaza or in, in Kenya or whatever. Then there is no reason for you to, to exist. This is I'm not talking about the corporate social responsibility and so on, which is very critical part for us. But your part, your contribution to jobs and growth.
Nor I wanted to go back to something that you mentioned as well, of course, welcoming this from our Bahrain's perspective, but there's also $1 billion permanent membership fee for the board. What's the return on that investment for Bahrain? And do you think that it will mean that those permanent seats will stay, given the price tag that President Trump is asking here?
I think it's worth clarifying here that no $1 billion is paid, the 1 billion is for a permanent seat, and our seat is what was offered the three year seat. So, if you're asking in general, I'll leave it to the countries to make that decision. Every country would have its own perspective, its own calculations, its own math. And for some countries, the math might be making sense and math for others. So it's up to the countries, I think, to decide.
Mapping. I like that word. Minister, can I get a quick response to that as well? On this billion dollar price tag?
It's exactly the same. It's, it's it's basically I mean, Egypt is very involved in this process. And, again, I think it's, it's, you're, by the way, most of your questions is more related to the Ministry of Foreign Affairs that have been involved in this process than to the Minister of Finance or.
The short answers.
So that's my short answer to your question. But in general, I think, if you tell me, for the region and the prospects of the region, putting an investing as a region in the stability of this in Gaza and in the prospect, I think, for the entire region, there is huge dividends.
Chairman Sajwani, I'm not sure if you want to speak to this as well because, it's well known that you have been a business partner for the Trump family, stripping the politics away, going back to what Hisham was saying, without the sovereign guarantees, would private capital also invest in Gaza's reconstruction in the short term? I mean, how quickly might we actually see money flowing in, in your view?
Honestly, I don't see that that private sector will be able to, of course, come and contribute money. Private sector will be able to build, but they have to be paid because those will be mostly contractors who typically contractors are not the wealthiest people in the world. You know, this is fortunate or unfortunate. Governments have to, you know, pay the amount is going to be huge. You're talking, you know, 2 million people, all their homes were gone, with the private sector contribute probably yes. If you ask people donation, different families, different people will contribute on their capacities, you know, but that's not going to solve the problem.
And the Gaza Riviera narrative, is that real or is that just noise?
Well, you just miss it. You should have asked Mr. Trump yesterday. You know, I'm not a decision.
Maker, and you'll get a straightforward answer and you'll get a straightforward answer.
And you get a straight answer. You won't, you know, but, you know, as you appreciate politics, a lot of things, people say what they do, what they don't do, I don't know, you know.
It's a fair point. Okay. So the the topic of this panel is about future economic development as well. So let's switch gears. Let's move off this Board of Peace plan. I appreciate getting all of your reaction to it just because it's so topical and so newsworthy. And so.
This is a personal view, by the way.
Of course. Of course. I think what we're also seeing, what we're also seeing in the region right now is, you know, while while some parts of the Middle East are facing unrest and conflict and sanctions and proxies, others are deploying capital into places like compute capacity and artificial intelligence, and the foundations for what will ultimately be probably the key driver for these economies into the 21st century. And AI is, of course, going to play a really, really important role in that. So let's talk about this from a future development perspective as well. Chairman Sajwani, I'll start with you again from a private investor's perspective here. Where do you actually see returns over the next decade with your own business? Because you have been expanding into data centers. You're tapping into this opportunity in the Middle East and the fundamental drivers that the Gulf economies have behind them when it comes to building out this AI capacity. What is the future for the region? When you look at this through the AI lens.
I redefine sorry, your question today. In my view, the AI is going to change the world and we are whatever you call it, third, fourth industrial revolution by all the means. And I think what happened with internet AI is going to do it ten times more, if not 100, and it will be. We're going through the same stage. When I read history, when the Ottoman Empire refused to use the typewriter and the left behind, and the Europeans, with all respect, they were very behind in 11th or 12th century, and the Middle East and Arabs were much advanced. It reverse because with the Industrial Revolution, European took the lead and they moved forward. And of course, us and the Western world today, the countries who are going to lead in that, they definitely are going to be much, much ahead. And the countries are going to take it easy and they're just going to talk about it. They're going to be behind and the gap not going to be exactly what happened. Look at it today and what happened to Europe. Let's go back to the, you know, 20th century. Where was Europe and where were Africa, you know, and that will be between countries who are going to AI. And not applying the gap is going to be so huge. Just unbelievable. Yesterday I had in my daughter lunch with Bill gates on some philanthropy and all that, and he was talking about how AI is going to in the medical. I mean, I was in California a few times in the last two years, and those companies are talking seriously, seriously and going to create also challenges in the, employment. And I think some of the countries are going to suffer very much is India, because a lot of outsourcing was happening from companies like us and others in American big companies to India. They're not obliged to employ Indians. So they're going to stop because AI is going to take your 80% of your accountant out. You're going to take your nurses out, end end, end end. So countries like India, like definitely China, America is very much ahead in the game. Europe is not moving forward, unfortunately, and they're going to be behind. I have a feeling that European very soon when the AI is going to hit the job market, is going to come up with regulations to regulate that, and that will make it even worse, because countries are going to protect the jobs. Very simple. Protect the jobs. Don't do AI stay behind countries who are going to say, no, we're going to go with AI and we need to find solution for the people to be unemployed. They're going to go move forward. So China, America and in the Middle East today, in my view, UAE and Saudi Arabia taking the lead there and the moving quite forward. And they're putting a lot of time and effort and money behind it. But at the end of the day, we're a small economies with respect. We're not going to make a dent globally. But America and China are the ones who are going to drive this, and it's going to be a major revolution.
It's a really interesting point because, as you say, the Gulf capitals have the deep pools of public and private capital to enable this AI future. At the same time, they have the interconnectivity with the United States, those American technology partnerships that are also helping to move this forward as well. The challenge is that this creates a two speed region where you have AI advancements happening in places like Saudi Arabia and the UAE, and perhaps other countries in the Mena region being left behind. So, Minister, can you speak to that? And what are you doing to ensure that Egypt stays out in front here when you have 100 million people to be looking after and making sure that you're also rising those living standards at the same time, lifting those living standards at the same time.
You know, in the last couple of years, last fiscal year, specifically, our service experts related to ICT, including some of the, shared things that we do for other, in the region, have reached almost $5 billion to keep this momentum and to benefit from the AI and to benefit from all those opportunities we are really having every year now a dedicated, one year program for our graduates. We are training almost 800,000 people per year, and we have a dedicated funding for that, because one of the things that Egypt can have besides the capital is also the youth, the capabilities and talented youth. So that's great. But I will tell you one thing also, last year and I tell you how AI can also, from a service point of view, make huge change and huge impact. Last year, we were able to increase our tax revenues by 35% without increasing tax rates. And big part of that was building trust and voluntary compliance. And AI have helped in that, helped in better communication, helped in improving our ability to identify taxpayers and better communicate with them. And it worked. So and this is one simple example of how it can have huge direct and indirect impact. But but I think it's, it's it's a fact and we have to be ready for it. It's not only about also investing in, in, in new R&D, but also having the talent and the capabilities to, to really take it forward.
Absolutely. Egypt's young population is a really good point. I do like that. Nor can you speak to this as well, because what we've also been talking about here is the fact that, the possibility of a two speed Middle East economy, of course, creates risks. But at the same time, this is not a new conversation, because for a long time, Gulf leaders and leaders across the Mena region have been attempting to diversify their economies away from oil. Can you speak to that?
I think I just want to maybe go to a point that we made earlier, speaking of of of the region and the the investment, the heavy investment that is happening, whether it's the wider technology center or specifically AI. I think it's worth mentioning here that the region is has been going through this growth spurt, which we hope would last, that capital is starting to flow into the country. So it's not no longer just the deep pockets of the region that is fueling the economic development. It is the trust of the larger companies, global companies, whether it's the East or the West, that is now taking advantage of what is happening in the region. And if I just zoom in on the GCC, I mean, it gives us a lot of pride to see what is happening in Saudi Arabia and the UAE in terms of them being leaders in that space. We always as a smaller economy in the region, we view ourselves as an economy that is complementary to what happens around us, whether it is the GCC or the wider Mena region, or even globally as an economy that is a service center, as an economy that is there to complement what is happening, we always look to see what is happening. And now on AI, it's not just a competition about who builds the most data centers or who has the LM or who doesn't. There is much more applications for AI. There's much more need for AI beyond just the data centers. But just on that data centers, I mean, we look at a few things in Bahrain when we come to to look at where we need to, where we need to be and how do we design this, this sector or subsector one is the human capital for sure. This is the foundation of of a small economy that is that does not have much a lot of natural resources. It is our human capital. And like any of a lot of the other countries, we've dedicated a lot into investing in the people, making sure that we have the right programs in place. Although the transformation hasn't yet happened in terms of people not finding jobs because AI is replace those jobs. We hear the numbers in the US. I think the latest number I heard is entry level jobs have decreased by 17 or 18%. This is I don't think this is something we're seeing right now in the region, but nevertheless, we do have programs to equip the people to make sure that they're ready and that they have this portfolio of skills to enable them to move from one job to another or to upskill. So we have our labor fund, Tamkeen, which funds or subsidizes the salaries and the training for any company that is set up in Bahrain, and that's hiring Bahrainis, they can take advantage. The other thing is the infrastructure and part of that infrastructure today is not just the roads and that, but there is the data centers. And we're proud to be the first country in the region to have the first hyperscale data center. And that's when AWS set up in Bahrain ten years ago, and it was set up not to serve 1.5 million population. It was done for the wider region, going beyond even the region. We're talking about going into Africa and hosting data. And the other thing that allows that is the regulation. And we're, I believe, still the only country in the world that has a data jurisdiction law or the data citizenship law, which allows international countries and companies to host data in Bahrain. So that's in terms of what we've done so far. But where we're focused is we believe that there needs to be or we need a space for AI applications, a country that could be a testbed, it could have a sandbox for startups to come and test their idea in a smaller country, where you can have a nationwide rollout of your idea, and then you could scale it up to other countries. So there's a lot of investment that is happening beyond just the data centers.
Yeah, it's a great point. It is a really good point. And I also wanted to extend the the question over to Hisham here as well, because one thing that you have also been thinking about is how AI is going to change the plumbing of the financial system in the Mena region as well, and also have the potential to change capital markets to. Can you speak to that?
Yeah, it's already changed it. But I remember very well in 2014 when we built our own private cloud, okay. Our data center now they call it private cloud okay. And that was in 2014. And we started to hire, data scientists with all the algorithm background and so on. I'm talking about the old terminology, which is the current terminology, the new terminology now. And we called it machine learning. Let's develop our algorithm and put in the machine. And then and we started that long time ago. So what's happening right now? We changed the terminology from machine learning to AI or whatever. It is. The same thing we did ten years ago, correct? Yes. Yeah. Correct. But we give it a fancy name. Okay. So what what I'm trying to say is that our business model has been changing year after year. And now when you one of our success stories, for example, on when, when the government required banks to lend SMEs, this was very challenging for other banks. What we did, we did, we took our predictive models and we used our predictive models based on a certain behavior. We built the model. So it's basically digital underwriting and easy. We people keep asking us how do you are matching and reaching that level? I said, listen guys, it's very easy. It's a money making. I would love to have all my portfolio sm y because it's very cheap to run. And the more transactions you do, the more learning. Okay. And now became a partner with those small companies. They trust us, they come to us. Okay. And any one of the things we learned from the customers as well, we developed our own internal, what you call it front facing digital banking. Okay. That currently based on the customer behavior, 90% of of the reasons used to go to the branch. You don't need to go now. So now there are very few things left like KYC and the digital onboarding. And if I do that, then my, my branches will become advisory hubs. Okay. That's already happening. So the job change every year we give a chance to people. We tell them, listen guys, your job will be eliminated next year okay? We have two options. One option. If you want to take a new challenge, we can invest money on you and teach you something different. Or it's your choice if you want to go and look for a job somewhere else. But we give the people the chance to learn and reuse them once more. Internally, and many of our current staff is people who accepted the change, and they learn because they know the institution. Then they acquire more knowledge. The, the use cases we have in AI. Okay, let's use the new terminology in AI, how it's helping our compliance team. Okay. How it's helping the credit underwriting. By the way, this is not a secret how it's helping us to design our technology architecture as well because we start to desegregate the channels based on previous data analytics on how heavy the data goes here and there, you start to segregate. It's amazing, but it's not for me. I'm not being arrogant, but this is what we started more than ten years ago.
If I may just jump in here, because I just want to emphasize on that point, we've been doing AI without realizing that it is it is AI. And as Mr. Hisham has been saying, we in Bahrain actually we've been having KYC. We've had we have digital onboarding, and that is something that is available for all the banks. All the banks are offering it to their customers. So there's already a lot of innovation that is happening that is homegrown in the region. So it's not going to be a switch of a button where the world transforms from what it is today into something completely different. We've been going on. That transformation in every country has been going through its own journey. Depending exactly on your original question about the diversification, because the financial services is the largest sector in our economy, there's a lot of innovation that is happening in that sector. Then you've got the manufacturing as well, which has having its own, journey. The telecoms are are innovating at the moment are digital company or telco, which has now become really a tech company, has its own cybersecurity startup which is now being rolled out globally. And we've got international customers taking advantage of homegrown, cybersecurity services.
I have to echo Hertog because one of my friends, used to be the governor of the central bank. Rashid Al Maharaj and I meet Rashid every year at the North Coast, and we talk about what they are doing there and so on. And the sandbox he created at the at the central bank for all the fintechs and the development there was very impressive to me. I wish we did the same thing at the time, but Rashid did an outstanding job there and honestly, the sky is the limit. Okay.
It's a great point. And just talking about a prosperity agenda for the Middle East, I think it's pretty clear that technology is going to play a key role in that, which is why I wanted to bring that.
Look at Africa.
Indeed.
And Africa. They can make not frog lap. They can do those guys can do tiger leaping. Okay. Because I meet a lot of talents in, in, in, in Kenya and in South Africa, Nigeria, Senegal. Those guys are I mean, this is the future of the continent is how can technology I saw sorry, I saw in Rwanda a group created a medical application where through your mobile, your report, your case and then a drone come to your village with the medicine. Rwanda is a landlocked country. Okay.
Very interesting. We have about ten minutes left. There is an opportunity to take some questions for the from the floor. So if anyone in the room and we have quite an intimate setting here, which is quite nice. If anyone in the room would like to ask our panelists a question, please do raise your hand. We can get a microphone over to you. If you would like to get involved in the conversation as well. Yes, sir. A question up at the back. If we can get a mic over there. So if you could just stand up, introduce yourself, and, pose your question. Thank you.
Hi there. This is Jack Dutton, chief business correspondent at Al-Monitor. My question is for the minister. Given the instability we've had in the region over this past year, the Red sea, the impact on tourism and the Suez Canal, what economic contingency plans does Egypt have to deal with any instability which may arise later this year?
Well, Egypt has been, dealing with those instabilities over the last two years, and they have been delivering very good outcomes. And those are public numbers. Last year, we had our tourism closing to 12, 20 million were 19.5 million. That's a huge growth. And the quality itself and the diversity is improving. We have seen our economy growing recently above 5%. For the first time in a couple of years, we have seen our fdis for the last five years, topping the continent and increasing significantly. And we're seeing a lot of movement into new sectors, including ICT sector and the IT sector. So I think the diversity of the Egyptian economy and the recent reforms and the buffers that we have been building over the last couple of years should allow us actually to be in a much better position to deal with any further development. But on the other side, we think that going forward, all prospects are even much better than what we have seen over the last couple of years. So let's hope for, for, for better prospects. But but of course, we are ready with a lot of buffers and with improvement in general in the foundation of the economy.
Mr. Minister, may I make a comment on, on on that question as, as a private sector, as a bank, we calculate our capital adequacy requirements from the year before we decide on our dividends and so on. This year is the lowest capital requirement is because of the risk tolerance and the risk appetite is improving. And here I'm running people money. It's not like I want to be nice to the government. I'm not a public sector, 100% private sector. And I can assure you that the way we look at things during 20 at least 2026 is much more positive than even 25. On top of that, I lived through a lot of crisis in Egypt since I went back in 99. I saw all the events in 2011. I saw the events in 12, 13, 14, I don't know, I keep going and things regional and, and and every time I tell people what doesn't kill you makes you stronger. That makes Egypt stronger. I feel resilience and strength come from how you manage crisis. Okay. And and that is a talent or a mojo in in Egypt. I'm sorry.
I will I will end with one, one number that I would like to share with you and with the audience and with everybody that tells you how much, also, prospects can improve. Last year, private investment, total private investment, whether domestic or external, increased by 73%. They grew by 73%. And I'm mentioning that to to echo what Hisham has just mentioned, those are people who are putting money and investing. And this is you cannot please somebody by putting money into invest. That's something you do it based on viability, based on your decision. So it tells you how much there is. Good prospect now, and I'm sure that this will translate into more productive capabilities, more experts, more things. But but it's one indicator that we are so proud of. Private investment grew by 73% in 2425.
How much of that is in the SC zone? Because obviously.
It's Egypt. Egypt is huge. So you will not find any. Of course, as the zone is doing very well, the number of companies went from 70 something couple of years ago now to doubling. And actually now it's going to another doubling in two years. So it's exponentially growing. But in general FDI last year also increased. But private investment is huge, is everywhere. It's in industrial zone. It's in the free zones. It's it's an old governorates and in all sectors. And Egypt is very diversified. But the zone is one of the very attractive. Now places in Egypt is growing exponentially. But of course 73% means that we have grew in a lot of places.
Any other questions in the room? Yes, sir. In the front. Where's our microphone? Yes, just over here. Thank you. Sir, please introduce yourself.
My name is Mohammed Al-ghanim. I'm from Kuwait, and I have a question to any of you. Preferably maybe one minister and one private sector. So we're talking about prosperity in the future. And so given the fact that this has to do with systems and processes, what is one area of structural reform that needs to be owned by both the private and the public sector in order for you to achieve this prosperity benchmark?
Excellent question.
Wow.
Do you want to start with me?
Private sector? Yeah. Sorry, Minister.
Did you want to pick that up first?
No, I'll allow him.
To go first. Of course.
For me, education, education. Still the the region and Egypt the education, although with all the investment that were were made in Egypt, still education, education, education. And and this is the you need to move from memorizing to research and development. And if you can do that, we can compete with the US in that. Because the difference, by the way, the difference between, what is the difference between the US and Europe and the US, they tell you in their laws that those are the prohibited things you should not do, and everything else you are allowed to do in Europe. They tell you those are the things you are allowed to do. So you are capped. But what you are allowed to do, and if we can change our approach in education and thinking and the regulatory side to the US side, then innovation will become the sky's your limit.
I have to fully agree with the education point, but also I just want to talk in general, for a small economy, the government could not be the one driving economic prosperity on its own, and that's something that we've realized. And it's fundamental to the vision 2030 that we issued back in 2008. It said economic development going forward will be driven by the private sector with the government, will do is create the right environment for the private sector to innovate, to create businesses, to grow their businesses, and that is through education, through making the systems easier, making the business environment, making the government processes the really easy for companies and creating institutions. That Economic Development board, which is created just to handhold the private sector, whether it's local or international, to navigate its way within Bahrain and understand the systems and find the best case for them to be present. So for me, it's the government and the private sector have to work together in absolutely everything. So whether it's the regulation, it has to it has to work for both, whether it's infrastructure, whether it is the human capital and the education. It has to be both working together.
Yeah.
Anyone else wanted to speak to that. Mr. Sajwani did you want to, did you want to speak to that as well in terms of the hardest decision that you'll have to make in, in terms of, yourself or maybe what the UAE has to make on the reform side?
I mean, UAE is doing quite well in economy, but if we talk about the overall Arab world or the Middle East, of course we have mega challenges. One big challenge is all those wars and political conflicts which are continuous. And every decade and every year they just get worse. They don't get better. And, that's a major challenge. I agree with, Mr.. Mr. Arab that the education is very important, but I have a third line. The, working habits are very important, you know, and when you look at the nations which are growing like China and to a certain extent, like America, people do work hard in our culture. When you work hard, you are being bombarded with criticism that you overworking. I'm sorry. That's our culture.
You know the expression PhD.
You know.
When you are very successful PhD, pull him down.
Okay.
I tell you a little story. I was in Davos two years ago, so journalists came asking me and I said, I don't give interview until you go to my office. He insisted on a question. I said, okay, he goes, one question I have for you. I said, tell me. He says, what is your recommendation for the young Arabs to be successful like you are? So, you know, in the middle of two meetings and he's running behind you, you don't have time to think. And I said, if you want to be successful, remember, there is nothing called 9 to 5. There is nothing called I'm going to switch off. There is nothing. I'm going to take a holiday for a month and then I don't answer my phones. You need to work three, six, five, seven days a week. Doesn't mean that you don't take holiday. You take holiday, but you still have to be aware of what you're doing in your business. And he put it in the social media, and I was the worst person in the world.
How many kids am I get and how many negativity I get because I just told them work hard. So now I made up my mind. Not going to answer any Jordan.
Well, on that note, unfortunately we're out of time. I think we better let you all go and get back to work now. Thank you so much for joining us today. Appreciate the conversation. Thank you. Thank you. Thank you.
Thank you. Thank you.