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U.S. companies roll with turmoil in Egypt

David Gura Sep 17, 2012

U.S. companies roll with turmoil in Egypt

David Gura Sep 17, 2012

Kai Ryssdal: There’ve been more protests today in the Middle East and across parts of the Muslim world. The violence over an anti-Islam film that started last week is a sharp reminder to businesses of the risks that can come with moving into new markets. But if they’re doing it right, uprisings and unrest are all part of the calculus that companies go through when they decide to expand overseas.

From Washington, Marketplace’s David Gura reports.

David Gura: Last week, when the unrest started, Kellye Gordon was in Cairo. She is an executive with a manufacturer called Cummins. The company has a distributor in Egypt.

Kellye Gordon: Probably even before the events hit the news, I began to get the emails and the SMSes from one of our internal security officers.

Gordon was traveling with a delegation of 50 U.S. companies. 

Gordon: Part of our business planning is thinking about the contingencies that we need to put in place to deal with the risks that are inherent in dealing with this market.

Those risks, Gordon says, are outweighed by the rewards of doing business in Egypt. Geoff Porter does risk consulting in North Africa, and he says that, when there is unrest, different companies react differently. If they have a presence in the region…

Geoff Porter: Then they have to reassess what their security profile is.

They do this every time there is turmoil. Porter says other businesses aren’t as used to unrest.

Porter: If you are a company that is considering North Africa for the first time, then this is going to give you pause, and it may encourage a company to postpone its plans for entering North Africa until things settle down into a more-predictable trajectory.

That might take six months or a year. Morris DeFeo heads the Middle East and North Africa practice for a law firm called Crowell and Moring. He says companies considering doing business in Egypt also take the opportunity to look at regulatory security, at things like transparency and accountability.

Morris DeFeo: Then, you take the long-view, and I think you bide your time and you invest accordingly.

And in a developing market, like Egypt, a country with a population of 82 million people, DeFeo says there are still significant opportunities for growth.

In Washington, I’m David Gura for Marketplace.

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