Media free zone opens Egypt to the world

Yomna Kamel Middle East Times staff

After decades of holding a monopoly over the ownership of radio and television broadcasting from Egypt, the Egyptian government last week opened a window of opportunity for the private sector to invest in broadcast media.

The policy change which will accommodate a media free zone to be set-up over a 3.5 square kilometer area in 6th of October is being interpreted by observers to be a knee-jerk reaction by Egypt to forestall similar plans under way in Jordan.

"Media outlets moving to the free zone will benefit from all tax and customs exemptions, privileges and guarantees granted to the zone. They will also benefit from the facilities of the Media Production City, which is part of the planned zone," said Minister of Information Safwat Al Sherif.

Egyptian officials vehemently denied any connection between the timing of the launch of the media free zone in Egypt and events in neighboring countries claiming that it has been part and parcel of Ministry of Information's strategy since the early 1990s.

"We have not decided to establish an Egyptian free zone for media as a reaction to Jordan's project. We are not competing with them, but cooperating and coordinating to attract more investment to the Arab world," said a former senior official at the ministry of information, speaking to the Middle East Times on condition of anonymity.

Certainly, Egypt set-up the Media Production City in the early 1990s in expectation of major Europe-based Arab satellite channels like MBC, ART, Orbit, Al Andalus and ANN relocating their production facilities to low cost production sites like Egypt.

In addition, as of June 1999, Arab ministers of information have been cooperating in drawing up a common code of info-ethics to attract satellite channels to be stationed and transmitted from the Arab world.

Egypt's Minister of Information Safwat Al Sherif last week called upon Arab and Egyptian private and state-owned satellite channels to make use of the newly planned E£3 billion media free-zone.

According to a statement released by the ministry, the media free-zone will comprise the Egyptian Media Production City (EMPC), Egyptian Satellite Company (Nilesat), Cable Network Egypt (CNE), Nile Communications Network (NCN), Egyptian Company for Thematic Channels and transmission centers. Ownership of the free zone will be divided between the Egyptian Radio and Television Union (ERTU), EMPC, and Nilesat. The private sector will take a 50 percent equity stake, while foreign companies will be allowed to own up to 20 percent of the project, the independent financial daily Al Alam Al Youm reported on January 20.

A Council of Trustees chaired by the Minister of Information will act as a committee of guardians supervising and controlling the flow of the project. Council members will be drawn from the founding members in addition to a selected representative from companies and bodies operating in the free zone. The secretary-general of the council will be appointed by the Minister of Information, the ministry statement said.

Operating licenses sought by Egyptian or non-Egyptian companies alike will require cabinet approval.

According to a ministry source, who wished to remain anonymous, companies operating television channels at the free zone will have to abide by the media code of ethics. "The code of ethics is still being prepared by the ministry. [Both] Egyptian and foreign companies shall abide by this code," he added.

At times of crises such as wars, natural disasters and matters related to national security, Egyptian companies operating in the free zone will have to comply with rules and controls issued by the cabinet .

A monitoring body will be set-up at ERTU to follow up on broadcast Egyptian news aired by Egyptian joint-stock companies. The company capital will be determined by the cabinet with special attention given to transmitting public satellite channels. The cabinet may, however, require that ERTU holds an equity stake in Egyptian companies specializing in news channels.

According to the ministry of information source, Akhbar Al Youm, is among institutions that had already proposed the idea of setting-up a news channel in the free zone.

As soon as the free zone project was announced, a number of businessmen expressed their intention to launch media related projects.

Esmat Al Sadat, an Egyptian businessman and a member the Egyptian-British Businessmen Council (EBBC), told Alam Al Youm, that he would call for a consortium among businessmen in Alexandria to set up the first privately owned television channel in Egypt.

"I encourage the [EBBC] council's members and other businessmen to participate in a consortium to establish a private channel. It is better to invite a number of companies to invest in such projects since they need big capital," Al Sadat said.

Work is already under way on building Mubarak International Studio Complex inside the media free zone which will house 14 cinema houses, TV and video shooting studios.

"The complex will house 18 up-to-date studios. Vital facilities will also open in this city such as a 300-room hotel, a shopping center and theaters," Al Sherif added.

The studio is an extension to the Media Production City which was launched four years ago. It comprises a studio complex, outdoor shooting areas, an open-air major theater and an indoor theater dedicated for TV production. It also includes services complex, a film laboratory with a total capacity of 100 film a year, a 250-room hotel, a training center and a staff club.