Company participating in energy hub plan, new cities discussed in first meeting
aji Jreijiri, chairperson and CEO of ABB in Egypt, said that his company awaits additional meetings with President Abdel Fattah Al-Sisi after the first meeting was held in April, to exchange visions and understand the president’s ideas about Egypt’s plan to become a regional energy hub and ABB’s participation in new cities.
“The second meeting we will be based on the plans of the president for the country. We will have to come up with proposals to meet those plans and support his vision,” Jreijiri told Daily News Egypt.
On 24 April, Al-Sisi received ABB CEO Ulrich Spiesshofer and discussed his vision for Egypt as an energy hub in the Middle East and North Africa. Also present at the meeting were Mohamed Shaker, minister of electricity and renewable energy; Jan Thesleff, ambassador of Sweden to Egypt, and Jreijiri, according to a previous press release from ABB.
Daily News Egypt sat down for an interview with Jreijiri, the transcript for which is below, lightly edited for clarity.
What was discussed in the first meeting with the president?
The discussions were about Egypt’s plan of being an energy hub and how ABB can support the governmental vision, and also, how ABB, as well as Sweden, can support the education sector in order to prepare Egypt for the coming industrial revolution and the new automation that will be used in industry within the coming years.
Egypt has a large number of licensed engineers. Today, the educational system covers certain levels and topics of education, but since the industry is going towards new technologies and new areas like robot tech, for example, we need to adapt our educational system; this is an area where we are experts.
Egypt has plans for developing new cities like the New Administrative Capital, New Alamein, and so on, in this area there will be cooperation to provide solutions for renewable energy and reducing carbon dioxide emissions and come up with more environmentally friendly solutions. We have solutions that will make the consumer use less power, while receiving the same quality and comfort.
Have you agreed with the president about specific projects that you will participate in?
Definitely, there are specific projects we are working on, but for the moment, we have a plan to meet the president again, then probably we will talk more precisely about specific projects.
The first meeting with the president was to exchange visions and understand the president’s ideas, then ABB will apply them to his plans for the country. We will have to come with proposals to meet those plans and support his visions.
For the moment, we do not make any declaration on specific projects.
Would you please tell me more about the activities of ABB? How many projects is ABB involved in?
ABB is working in two major sectors in Egypt, one is the energy sector, where our mission is to transport energy from the energy sources like power plants, solar power plants, or wind power plants to the consumers. We convert the energy to a kind that suits the consumers by using the latest technology. We care about transporting high quality energy without losses.
We also provide energy solutions in compound communities to bring power directly to the consumer and to control the power, so in this area, we were awarded recently the regional control centre for the canal with Elsewedy Electric. There are some projects which are under pursuit and discussions with the government. The solution here is to manage the canal area.
The projects which we are involved in are in the network and distribution substations of different capacities.
We have another sector, which is industrial automation, and this serves the entire industry process, which is related to the food and beverage industry, for example. Cement, oil and gas, and packaging are becoming widely automated, and we provide the electrical and automation solutions that approve the quality and reduce the processing time.
We are very active in the infrastructure and construction sector like in the New Administrative Capital, for example. We are providing solutions for most of the ministries’ buildings there, through very known contractors in the market. We have the same kind of work in New Alamein as well.
We are also working on the Grand Egyptian Museum (GEM); all the electrification in the museum is done by ABB. It is a very long project which we have been working on for years now. Once it is completed, it will be a landmark in Egypt.
What is the size of the GEM’s contracts?
We do not talk about the numbers, but in long projects like the GEM, you start with conditions and end with different pillars. When we started working on the GEM, the Egyptian pound was at $5.6, but today, it is totally different. Secondly, we you are building a project like this, during the duration of implementation, you discover other needs, and we have not finished yet.
May be after finishing will you have a figure?
Yes, but unfortunately, we will not disclose it. What is important is the value added to the project, but it is a project this is expanding, and there are additional requirements that we are meeting with contractors.
All the equipment installed at the GEM include the latest technologies. You will not change them in five or 10 years, they have to last as long as the museum. We are here to serve the customer during the first stage of openings.
What is the total amount of ABB’s investments in the Egyptian market?
We have been investing in Egypt even during the past seven years since the revolution and have been here since 1979.
Seven years ago, the group decided that Egypt will be an export hub for Africa, and to do that, you need a certain capacity. We needed to upgrade our machines, we needed new specifications, so we started to analyse the requirements to cover the new markets.
Even when there was a revolution in Tahrir Square, we continued working in 10th of Ramadan City.
We use the slow demand in the Egyptian market to upgrade the factories and we invested heavily several—millions of dollars—in order to upgrade the factories to meet the expected demand in Egypt and Africa.
We will continue our investments in the market, we will continue hiring people, we still have the allocation for Africa. The Egyptian market is growing tremendously, especially demand in the construction sector and distribution. You see the expansions in these two areas.
There is more and more demand for energy in Africa; the requirements in Africa will push us to expand and serve the African markets.
How many factories do you have in Egypt?
We have two areas in 10th of Ramadan City designated for manufacturing: one is a transformer factory and the other is a campus that hosts about six factories in one place, which produces different products.
Then we have an area in Nasr City where we assemble products, and we also have a service facility in Obour City, where we do repairs for big motors, machines that are used in industry like in the cement and oil and gas fields. We also have a service workshop in the Suez region in the free zone, where we repair turbochargers that are in the generators of motors ships.
What is the value of your exports and your goals for the coming years?
Today our exports represent 18-20% of our production. Our plan was to reach 40%, but the demand of the market is growing practically twice compared to our previous expectations. We want to reach 40% so we have to expand our production to respond to the increasing demand.
We are expanding our transformer factory in 10th of Ramadan City and we recently got the land to increase its capacity.
What capacity will the expansions add to the factory?
The expansions of the transformer factory will increase its capacity by 20% compared to the current capacity. Frankly speaking, we see the market is growing even more.
Do you face any challenges while working in the Egyptian market?
Yes, we do actually. Like every business, we have some issues. We are starting to face a shortage in skilled human resources and, unfortunately, we see that a lot of the Egyptian technical resources and engineers are leaving the country for the Gulf or other countries, and this is something which causes a gap in the skilled technical resources that are needed for the current and coming developments. They are leaving not because they do not like it here, but to improve their quality of life, so unfortunately, this is creating a gap in the market in terms of skilled resources.
There are some changes in laws and administration, which sometimes affect operations. More specifically, I am talking about customs clearance. We need to work closely with the Ministry of Finance to create awareness about new imported technologies, in order to easily position these technologies, like robots for example.
When we import a robot to Egypt to be used in a manufacturing line, today because robots are new to the market, it is difficult for the customs authority to know which sector to classify the robots in.
There are more technologies that will be introduced to the market on 9 May. We will have an event to introduce many intelligent products that can communicate remotely and give you their state of operation.
I will give you an example: a transformer that can tell its problems, like heating up or needing to be oiled, without a technician going to the site, so the transformer will have a product that has a communication capacity.
When we import these new communicating transformers, the customs will have to wait for the Ministry of Communications and Information Technology to approve them, and then the army has to give the approval, so it is becoming more complex. But this is the future, and we need to raise more awareness over the approval challenges of the ministries.
We respect the rules of the country, but we want to cooperate with the ministries to inform the people in charge about the new technologies to understand what to do and where to classify the products when imported.
Do you have any meeting with Egyptian ministries to discuss your challenges?
Of course, we have opened discussions. We definitely have a lot of meetings with the Ministry of Electricity. Moreover, we have discussed with the Egyptian Customs Authority. We did not talk to the minister himself, but he had the person in charge of customs. He is very open, he listens, he would like to have different opinions from other companies. He tells us to be patient and that he will solve the issue.
What about your strategy in the next five years?
Our strategy is to move more towards the digital world, to offer more intelligent solutions that would reduce the time of availability of the systems. The remote services.
I will give you an example: if a technician needs to go to a site in Banha to identify a motor problem of a certain customer, he will need two hours to go and come back to have certain equipment. With the new technologies, we can do the diagnoses remotely, we do not have to waste hours on the road; we go directly and fix the motor with the needed equipment. We will apply the same concept to all of our products.
We will work on preparing the market for e-mobility, the electric vehicles in the public and private transportation, so we need from now to start working on the infrastructure of the new cities to accommodate electric buses, for example. This means that we will have to be sure that we have suitable charging points in the stations, you will have to have the right cables and right installations to prepare the people in the coming future.