SEKEM Insight 10.11 EN

Nr. 110 - October 2011

Insight

SEKEM‘s Journal for Culture, Economy, Society and Ecology in Egypt

Editorial Dear Readers, it may seem as if the Egyptian revolution of past February has not been moving anywhere yet. Meanwhile a revolution in its own right and towards a very special goal is happening at SEKEM.

Solar Energy

Partners

Interview

Ambitious Goals for Egypt

Ethical Development with Triodos Bank

Dr. Ibrahim Abouleish on the Revolution

Ambitious Goals for Solar Energy in Egypt The sun will not bill you for its energy. This trivial fact could mean the future for a sun-spoiled country like Egypt. A new AustrianEgyptian economic partnership has now set out to explore how.

For years, alternative energy sources have been used in productive industrial use on the grounds of the original farm and at many other locations. The associated new technologies in use include the wind turbines on the roofs of the main administration’s office buildings in Cairo and the Scheffler Mirrors on the farm which are being used in steam generation.

So far, however, all these technologies have been used only on a very small scale nationwide.

This is due to the still comparatively low cost of fossil fuels. Their prices are still disproportionately cheap in comparison to the actual harm to human health and the environment done by fossil fuels.

SEKEM is now doing a great step forward with its Austrian partners.

A pilot project co-financed by the country of Austria is to make solar power more attractive in Egypt.

Our lead article in this edition explores the issue.

Your Team of Editors Find SEKEM also on the Internet at:

SEKEM‘s apprentices working on the first of many boilers for the new alternative energy project.

S

EKEM has recently begun collaboration with three Austrian companies (SEKEM Energy, GREENoneTEC and PINK) to heavily invest in the promotion of the use of solar energy in Egypt. Firstly, the consortium intends to install a 70m2 solar thermal energy demonstration plant in productive use on the original SEKEM farm. It then aims to begin training professionals in the field of solar thermal energy generation in order to build the human

foundation for a cohort of trained future professionals in the industry.

The oil of the 21st Century Solar energy represents the oil of the 21 st Century, the Austrian project partners believe. This is particularly true for Egypt, a land of the sun.

The average solar energy generation capacity here is generally measured at around 2.500kWh/m2 per year. In Austria, in comparison, the sun can SEKEM Insight | October 2011 | Page 1

Economy

only generate about 1.000 kWh/m2 per year. This way the sun „produces“ the equivalent of around 250l of oil per square meter per year in Egypt.

While Egypt is rich in sun, Austria has the technical know-how. The country is an international solar thermal technology leader and is also home to the world‘s largest collector manufacturer.

„

The partnership aims to build a long-term cooperation between Austrian and Egyptian companies and to create stable local value chains.

The sun‘s energy can be harnessed to produce electricity and to heat or cool buildings and facilities. In the new SEKEM project the focus is initially on its capacity for heat generation.

Especially in Egypt, a country with almost 365 sunny days a year, the sun holds a tremendous economic and ecological potential, which until today have been considered far too little.

The use of large-scale solar thermal plants for the production of hot water in hotels, apartment buildings and industrial plants could set new international standards in this sector. The rapidly increasing population and the concomitant increases in energy consumption mean that Egypt has already begun looking for solutions to a persistent and severe energy supply problem. Since the country is also going through a time of fundamental change, the project partners are convinced that now is a good opportunity to set a strong signal for positive and sustainable development through renewable energy technologies.

Austrian government supports The project that is co-financed by the “Austrian Development Cooperation” (ADC) agency has the long-term goal of harnessing the power of the Egyptian sun and to exploit it as a potent economic factor using high quality solar

The project team during the inspection and evaluation of solar thermal systems in Egypt.

systems made in the country. The Austrian experts from SEKEM Energy, GREENoneTEC, and PINK bring into the project the know-how of many years of experience in solar technology development, solar collector production, and the construction of the necessary storage facilities. They also contribute to the partnership their expertise in strategic planning and implementation. The local support of the economic partnership comes from the Egyptian partners SEKEM, e-Green and EcoEnergy.

Fundamental changes necessary To succeed in the venture of promoting and selling technically advanced solar thermal power plants in Egypt many challenges have to be overcome.

To begin with, the technical conditions that apply to the implementation of large-scale technological installations and that are specific to the country have to be analysed and adapted solutions be developed. This task is to be performed by the project team.

All solar thermal components currently available on the Egyptian market are, for instance, poorly adapted to local climatic needs. The extremely fine desert sand, the quality of local waters that differs substantially across

the country, and the high salt content of the air must be considered early in the development process because factors like these quickly cause irreparable damage to components, especially the highly sensitive solar collectors.

In addition, there is a lack of trained personnel who could carry out installation and maintenance services. For this reason, the project will also provide training to build the required professional expertise in the new economic sector.

A pilot plant will first be built using quality Austrian and Egyptian components on the original SEKEM farm close to Belbeis. It is intended primarily as a training facility for future installers, manufacturers, and the apprentices of SEKEM’s Vocational Training Centre and students of the forthcoming Heliopolis University. In addition, it will also be used in the industrial production of several SEKEM companies, specifically in steam generation. Water is heated to above 70° centigrade and then used to produce steam for various manufacturing processes on the farm. This reduces the use of diesel fuel and saves on CO2 emissions.

The Austrian-Egyptian economic partnership envisages a long-term cooperation between companies from SEKEM Insight | October 2011 | Page 2

Economy

convinced that education is a central key to tackling many social, economic, and other related challenges.

Furthermore, a new tertiary education track will be created in the field of solar energy also at the future Heliopolis University.

Monitoring and maintenance using the latest in technology The Scheffler Mirrors currently producing steam on the SEKEM farm.

both countries and the creation of locally embedded value chains in the ​​emerging solar thermal energy sector. Therefore, the project team will also have to deal with the development of quality standards for the future Egyptian solar products. The employees of the SEKEM Development Foundation (SDF), SEKEM’s non-profit arm, as well as employees of selected Egyptian companies will be among the first beneficiaries of the training courses. The collaboration pursues the ambitious goal of producing high quality solar thermal systems using Egyptian-made components to the greatest possible extent. Only essential and very complex components such as collector panels and control systems are to be shipped from Austria. To achieve this goal, the Egyptian manufacturers will have to meet strict quality standards and need to be financially capable to produce solar thermal systems at an affordable and competitive price.

New opportunities for students and trainees at SEKEM It is for this reason that the trainees at SEKEM’s vocational training centre in the future will be trained in order to be able to perform necessary self-maintenance on their solar thermal installations. This is to provide the apprentices of the VTC with an opportunity to embark on new professional careers and a special technical training challenge that is currently unavailable anywhere else on the Egyptian educational market. Consequently, the employees of SEKEM Energy are

The SEKEM-based demonstration plant will feature technologies allowing the remote maintenance (telemonitoring) of facilities and installations from anywhere around the world via the Internet. All key performance indicators can be examined remotely at any time of day. In the future, the students of the Heliopolis University shall be well-equipped to maintain their equipment themselves as well as understand and evaluate all technical figures under real-life conditions.

Through the new project the EuroMediterranean project team intends to actively contribute to positive change in Egypt and support Egyptians in their struggle to develop profitable, ecologically sound, and sustainable long-term solutions to their country’s economic and social challenges. The project intends to achieve this through supporting the transition from fossil fuels and nuclear power to clean solar energy. According to the partners, the utilization of the sun’s unlimited resources holds the greatest potential for peaceful social development, greater economic prowess, „green“ jobs, and new perspectives in dealing with man, his environment, and nature in the long-term.

The team of SEKEM Energy will be pleased to answer questions or provide more information on the project at office@SEKEMenergy.com Birgit Birnstingl-Gottinger, Nicole Olsacher (SEKEM Energy GmbH)

!

More information:

World Economic Forum Names SEKEM “Sustainability Champion”

T

he World Economic Forum has chosen SEKEM as one of 16 “Sustainability Champions” in the developing world which are tackling environmental and social problems. The initiative was rewarded by the forum for its continuous efforts promote sustainable development in Egypt and worldwide. At the World Economic Forum’s Annual Meeting of the New Champions 2011 in China, 16 companies originating in the emerging markets were presented as ‘Sustainability Champions’, selected by the World Economic Forum and the Boston Consulting Group from an initial pool of more than 1,000 companies.

Since 2003, when SEKEM received the Alternative Nobel Prize, Chairman Dr. Ibrahim Abouleish and Managing Director Helmy Abouleish are frequently participating in the World Economic Forum (WEF) as Fellows of the Schwab Foundation to promote social entrepreneurship and sustainable development.

Unsustainable practices and policies in the private and governmental sector are the root causes for poverty and environmental degradation, not only in Egypt but worldwide. SEKEM’s business model counters these issues.

“This international recognition underlines that our business model is a best practice to address poverty, resource scarcity and climate change”, stated Helmy Abouleish.

Within this framework, the WEF and the Boston Consulting Group set out to seek unconventional, practical solutions to the current challenges of growth, aiming to identify and support key business practices, and to relay them to the global community.

Source: SEKEM press release

http://www.SEKEMenergy.at/

You can visit SEKEM yourself: www.SEKEM-reisen.de www.aventerra.de

!

More information: http://www3.weforum.org/docs/WEF_GGC_ SustainabilityChampions_Report_2011.pdf

SEKEM Insight | October 2011 | Page 3

Economy

A Role Model and a Source of Inspiration It is only through the support of its circle of friends that SEKEM can develop desert soils to produce healthier food.

Since the 2007 the Triodos Bank has been a part of it.

A fund to support development

Thanks also to the courage of innovative banks, SEKEM can continue to break new ground in agriculture, as seen here on the new farm area on the Sinai peninsula.

T

riodos Bank N.V. is Europe‘s leading sustainable bank. Founded in 1980 in the Netherlands, she now has around 316.000 customers who find confidence in the fact that the bank only finances enterprises, institutions and projects that contribute to the benefit of man, human development, and the environment.

Model for proper development In the view of the bank, one such enterprise is the SEKEM Initiative. This is because the work of the initiative for better livelihoods, social rejuvenation, and holistic human development is founded on three interconnected pillars of sustainability: people, environment, and the economy. At SEKEM, they are being brought into balance.

SEKEM provides not only high quality products based on biodynamic agriculture but is so economically successful

that it can actively invest into cultural projects, education, research and public healthcare for beneficiaries in the region. Thus SEKEM is a sustainable development model of exemplary character, a role model especially for developing and emerging countries.

The Triodos Bank has recognized SEKEM’s special character early on.

Both enterprises share their pioneering roles and look back on a long partnership based on shared values ​​and goals: a pioneering spirit, entrepreneurial, holistic thinking and activities with the primary aim of improving the quality of life of present and future generations. This explicitly includes the strengthening of “North-South” relations between actors in industrialised and developing countries or emerging markets. Furthermore, both partners are leading players in the global movement for greater sustainable development.

Since 2007, the Triodos Bank’s Triodos Ventures Fund began investing in the SEKEM Group of companies and the bank is now represented on the initiative’s board. In the same year Triodos Bank issued a SEKEM bond for private investors in the Netherlands.

With both forms of financing the bank could greatly support the further expansion of SEKEM. Investment in manufacturing equipment, packaging machinery, cold storage and warehousing, and new processing techniques were made and new desert grounds could be developed. The partnership of SEKEM with the bank, which originally began with the financing of exports of the initiative to Europe, strengthens ecological agriculture and social development in Egypt and improves the range of fairly traded organic products in Europe’s markets.

Hans Schut, representative of Triodos Bank on SEKEM’s supervisory board, sees an important future role for the initiative and its social ambitions: “The current social change in Egypt is a challenge for SEKEM but also an opportunity. Its very authentic philosophy combines the focus on improving the quality of life with longterm competitive economic strength.

SEKEM is an example of sustainable enterprise. But it is also a source of inspiration and a role model across borders.” Triodos Bank is very pleased to be able to accompany SEKEM into the future and support its work for a more humane social development.

Stefanie Erhardt Stefanie Erhardt is in charge of the press and public relations for Triodos Bank Germany.

!

More information: http://www.triodos.de

SEKEM Insight | October 2011 | Page 4

ECOVILLAGE CONFERENCE:

Empowering Communities for Sustainable Development in Northern Africa Organised by the Global Ecovillage Network and SEKEM

18 - 21 November 2011 at SEKEM, Egypt

Goals of this conference:

The conference schedule includes:

To make visible the dynamic and impressive work already being done to create sustainable community solutions all over Northern Africa

A tour of SEKEM and presentation on its history, operation, and practical solutions (For more information visit www.sekem.com)

To connect key actors, change agents, and social innovators throughout the region

A presentation of the Global Ecovillage Network and the emerging network in Africa (For more information visit www.gen-europe.org)

To facilitate exchange of inspiration, information and training amongst community-based approaches to sustainability To scale up community-based strategies for climate change adaptation and stability in the region

Discussion of community-based strategies for sustainable development, focusing on best practices, appropriate technologies, and civil engagement Open space for dialogue and networking

To empower civil society initiatives in their contribution to sustainable development

Funding is available for fifty participants from NGO’s and projects from Northern Africa (Algeria, Egypt, Libya, Morocco, Sudan and Tunisia).

Opportunities to present your own project

This conference takes place with the financial support of the German Federal Foreign Office.

This is an alcohol-free event.

Twenty more spaces at this conference are available for paying participants from other countries.

If you are interested please contact Kosha Anja Joubert at:

Funding is available to attend for NGO’s and projects from the North African countries. conference.egypt@gen-europe.org.

This is an alcohol-free event. For more information or to register, please contact: Ethan Hirsch-Tauber at: ehirschtauber@gmail.com

SEKEM Insight | October 2011 | Page 5

Economy

The Business Development of the SEKEM Group of Companies in 3. Quarter 2011 Sales (consolidated)

In the 3. quarter of 2011 revenues of the SEKEM Group of Companies increased by 1 million Egyptian pounds (EGP) from 45 million Egyptian pounds to 1 million pounds to 46 million compared to the same period of 2010.

45 Mio. EGP

Q3 2010

However, this must be seen in context with the firms’ performance this year which resulted in an overall loss of -3% by the end of September.

46 Mio. EGP

Q3 2011

EBITDA (consolidated)

EBITDA (earnings before interests, taxes, depreciation and amortization) is made up of the combined net income before taxes, net interest income and the depreciation of the company. Compared to the same period in 2010, the EBITDA of SEKEM group rose to 12 million EGP in the 3. quarter of 2011.

All quarters of the year to date taken together now register an overall loss in EBITDA of -3%.

Q3 2011

12 Mio. EGP

Q3 2010

8 Mio. EGP

Shares of Sales (local vs. export)

Q2 2010

Q2 2011

75%

25%

70%

In the diagram on shares of sales (local vs. export), domestic (Egyptian) and foreign (all other countries) sections of sales are compared to a total sales volume of 100%.

30%

Lokal

Export

Shares of Sales (by product sector)

The shares of sales of all SEKEM Group’s companies are evaluated across the main product sectors of farm products, phytopharmaceuticals, textiles, and FMCG (food, manufactured. and consumer goods).

17%

17%

Farming

15%

Pharma

51%

Textiles

FMCG

SEKEM Insight | October 2011 | Page 6

Culture

A Freedom to Create Matthias Maurer, editor of the German magazine for Waldorf education “erziehungskunst”, spoke with Dr. Ibrahim Abouleish in October on the topic of the revolution in the Arab world.

the revolution it has yet to be. This would require an active, creative grasp of the future, even a spiritual outlook. When its time comes, then Egypt will certainly be a role model.

We are more than 80 million people, after all...

What are the hopes and expectations of the people?

Dr. Ibrahim Abouleish speaking on organic agriculture at the BIOAUSTRIA in October 2011.

How do you personally see the current situation in the Arab world?

Dr. A: We are witnessing a process of transformation, a social transformation that is equivalent to the European renaissance. Prepared by a small group of intellectuals and artists, who worked as catalysts, paving the road for the future development of human capacities that have long been subjugated: freedom, individuality, the idea of ​​ human rights, the dignity of the individual.

Should we not be careful to not equate such developments with European ideas?

Dr. A: These ideas have their origin in Europe. We definitely need ethical ideals similar to those enshrined in the German constitution, to give just one example. We need the codification of fundamental rights. But

we are speaking about the future development of an open-ended process that may stretch over many decades.

You do not believe in stable democratic nations in the Arab world in the near term?

Dr A: I am convince that we need to think in the very long term. What we now need are stable social structures that address the safety issue, help in the creation of a differentiated political landscape, and support people in democratic decision-making. The economy is broke, the tourists are gone - there is a phase of anarchy now in the country that needs to be overcome.

Do you believe in the Egyptian revolution as a role model for the entire Arab world?

Dr A: So far there has been only an uprising, a rebellion. I believe

Dr A: Their hopes centre around respect for the individual and his opportunities for development. It is not about wealth or power, but very elementary values. It is about what we practice in SEKEM: a human interaction in which the individual feels safe and valued, can shape his own life and that of his family, enjoy health care and benefit from learning opportunities. The idea is to have a perspective, not only to work for a living, but to develop the potentials of ones personality.

What about the risk that this “awakening movement” could be exploited by groups and degenerate into a partypolitical movement?

Dr A: To become a true revolution, the uprising will have to discover its “inside”, its true human needs.

Its actions are still focussing largely on a superficial liberation from the oppression of the old. The next step will have to be a courageous grasp of the freedom to create structures anew: economic, human, social, and ecological structures. For this we will need patience and some hope for the inspiration and the sympathy of the spiritual world witnessing the current events.

Questions posed by Matthias Maurer. The text first appeared in the magazine „Erziehungskunst“ (10.11).

SEKEM Insight | October 2011 | Page 7

Impressions

Impressions from SEKEM

L

ike every year in November, for many varieties of vegetables the winter season has just started. SEKEM Europe then begins to import those vegetables until the following early summer, which are generally not available in Europe, such as sweet and hot peppers, cucumbers, artichokes, green beans and sweet potatoes. From April on, SEKEM Europe will add to this portfolio potatoes to replace the diminishing stocks of local storage potatoes. Beginning in May, it will also add onions to the mix.

These products are usually imported by ship from Italy, distributed at the wholesale market in Munich, and delivered from there to health food wholesale partners throughout Germany. From here the products are then shipped to natural food stores and organic supermarkets. The products can be distinguished in stores either by the distinctive green SEKEM boxes with the familiar orange-colored Demeter logo, or the marking “Demeter / Egypt�.

SEKEM Insight | October 2011 | Page 8

News in Brief

SEKEM Group Contributes to Egyptian ‘National Employment Pact’

Forum on „Biodiversity in the Enterprise“

SEKEM Group continues on its sustainable development path by significantly contributing to the ‘National Employment Pact’ (NEP) – an initiative of the Egyptian German Business Community in cooperation with the AHK (German-Arab Chamber of Industry and Commerce), the German Federal Government and GIZ (German association on international cooperation).

increasing. Additionally there are great difficulties to connect motivated unemployed people to existing jobs.

The ‘National Employment Pact’ (NEP) is initiated to help answer these challenges. Helmy Abouleish, Managing Director of SEKEM Group, recognizes this: “We are facing a difficult employment situation in Egypt, especially for the young people. SEKEM is doing its share to ease this situation by participating in the ‘National Employment Pact’ with 200 new jobs”.

“How can biological diversity be incorporated into corporate sustainability processes on a grander scale?”

These and other questions were raised by experts and company representatives at the second national dialogue forum „Biodiversity in the Enterprise“ on 20 October 2011 in Fulda.

A cooperation between Germany and Egypt

The event focussed on the integration of biodiversity into environmental management systems and the potential of marketing to enhance environment-friendly consumerism among an enterprises’ clients. The participants agreed that the prerequisite for credible corporate communication should put an enterprise’s own actual activities and a clear public positioning of the company for biodiversity and environmental conservation at its centre.

In addition, the communication must be easy to understand and be able to transport the emotional significance of the topic in order to allow its messages to actually lead to behavioural change.

200 jobs to fight the economic crisis During an executive business breakfast, Helmy Abouleish, Managing Director of SEKEM Group, pledged to create 200 jobs within the NEP framework to fight the current economic crisis and dire employment situation in post-revolutionary Egypt. SEKEM group thereby continues its employ-

ment policy which puts human development to the front.

SEKEM Group sees human development at the core to overcome the current economic crisis. Having a job and having a source of income is essential for living a decent life. SEKEM Group already provides around 2000 jobs and, due to its sustainable approach, was able to keep almost all of them despite the negative economic impact of the Egyptian revolution.

The growing unemployment of youth is the focal point of the challenges faced by the country. 2 million young Egyptians are currently without work - and this trend is rapidly

With the NEP, the Egyptian German Business Community in Egypt in collaboration with the AHK, the German Federal Government and GIZ is starting an initiative with a pragmatic, direct and high impact on framework conditions to help answer this economic challenge. The aim is to provide 5000 jobs from companies that show corporate social responsibility by providing employee-friendly working conditions. The NEP is intended not only to be a political gesture but a credible mid- and long-term contribution to foster employment by setting up an ‘Employment Center’. Human Resources experts will be hired to collect job offers and orient job seekers to facilitate an effective matchmaking process.

Egyptian and German companies are cooperating and contributing to this cause out of their commitment to Egypt. This initiative serves as a reference model for the setup of similar employment centres throughout Egypt.

Source: SEKEM press release

!

More information:

The participants had been invited by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), and the Federal Agency for Nature Conservation (BfN).

Source: BioMarkt.info

Masthead: The editors of SEKEM Insight wish to thank all contributors to this issue.

Editor: Bijan Kafi Contact: SEKEM-Insight c/o SEKEM Holding P.O.Box 2834, El Horreya, Heliopolis, Cairo, Egypt insight@SEKEM.com Pictures: Pages 1,2: SEKEM Energy; 3,8,9: SEKEM; 4: Bijan Kafi; 7: BIOAUSTRIA/Jan Gott No republication without written consent by the publisher.

http://www.ahkmena.com/nep

SEKEM Insight | October 2011 | Page 9