Review
the assigned case study and complete this assignment.
Write
a five to seven (5-7) page paper in which you:
Analyze how
the Critical Success Factors (CSFs) apply to the facts of the case study.
Provide examples to support your analysis. Evaluate the reading and ask
yourself what are the factors that mean “success”. Without these factors
success is not possible.Determine the
project benefits, organizational readiness, and risk culture of the
company in the case study. Provide justification for your response. Benefits:
What are the “returns” associated with this project? Risk Culture: How
does the company feel about risk? Are they risk adverse? Are they risk
“happy”?  Present the evidence that
supports your claim?Develop at
least three (3) project risk recommendations based on the analysis from
criteria number 1 and 2 of this assignment. Based on your analysis in items
1 and 2 above: what would you recommend?Identify the initial categories
of risk (RBS Level 1 and 2) that you see as being present in the case
study using the Example Risk Checklist (Figure A-2, Hillson & Simon
text). See
the figure; self-explanatoryUse at least four (5) quality
resources in this assignment. Note: Wikipedia and similar Websites
do not qualify as quality resources.
Your
assignment must follow these formatting requirements:
Be typed, double spaced, using
Times New Roman font (size 12), with one-inch margins on all sides.Include a cover page containing
the title of the assignment, the student name, the professor’s name, the
course title, and the date. The cover page and the reference page are not
included in the required assignment page length.1 of 2
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Grading for this assignment will be based on answer quality, logic / organization of the paper, and language and writing
skills, using the following rubric.
Points:
240
Criteria
1. Prepare
the Scope
and
Objectives of
the Risk
Management
Process
section of
the Risk
Management
Plan based
on the facts
presented in
the case
study.
Weight: 15%
2. Determine
the project
size, based
on the facts
presented in
the case
study and
provide
justification
based on
Figure 3-4,
Example
Project
Sizing Tool
(Chapter 3 of
the Hillson
and Simon
text).
Weight: 15%
3. Select the
risk tools
and
techniques,
and
complete the
Risk Tools
and
Techniques
section of
the Risk
Management
Plan for both
the
qualitative
and
quantitative
aspects of
the project.
Provide a
rationale for
the
Unacceptable
Below 70% F
Assignment 2: Risk Management Plan
Fair
70-79% C
Proficient
80-89% B
Exemplary
90-100% A
Did not submit or
incompletely prepared
the Scope and
Objectives of the Risk
Management Process
section of the Risk
Management Plan
based on the facts
presented in the case
study.
Partially prepared
the Scope and
Objectives of the
Risk Management
Process section of
the Risk
Management Plan
based on the facts
presented in the
case study.
Satisfactorily prepared
the Scope and
Objectives of the Risk
Management Process
section of the Risk
Management Plan
based on the facts
presented in the case
study.
Thoroughly prepared
the Scope and
Objectives of the Risk
Management Process
section of the Risk
Management Plan
based on the facts
presented in the case
study.
Did not submit or
Partially determined
the project size,
based on the facts
presented in the
case study; partially
provided
justification based
on Figure 3-4,
Example Project
Sizing Tool
(Chapter 3 of the
Hillson and Simon
text).
Satisfactorily determined
the project size, based
on the facts presented in
the case study;
satisfactorily provided
justification based on
Figure 3-4, Example
Project Sizing Tool
(Chapter 3 of the Hillson
and Simon text).
Thoroughly determined
the project size, based
on the facts presented
in the case study;
thoroughly provided
justification based on
Figure 3-4, Example
Project Sizing Tool
(Chapter 3 of the
Hillson and Simon
text).
Partially selected
the risk tools and
techniques; partially
completed the Risk
Tools and
Techniques section
of the Risk
Management Plan
for both the
qualitative and
quantitative aspects
of the
project. Partially
provided a rationale
for the selection.
Satisfactorily selected
the risk tools and
techniques; satisfactorily
completed the Risk
Tools and Techniques
section of the Risk
Management Plan for
both the qualitative and
quantitative aspects of
the project. Satisfactorily
provided a rationale for
the selection.
Thoroughly selected
the risk tools and
techniques; thoroughly
completed the Risk
Tools and Techniques
section of the Risk
Management Plan for
both the qualitative
and quantitative
aspects of the
project. Thoroughly
provided a rationale for
the selection.
incompletely determined
the project size, based
on the facts presented
in the case study; did
not submit or
incompletely provided
justification based on
Figure 3-4, Example
Project Sizing Tool
(Chapter 3 of the Hillson
and Simon text).
Did not submit or
incompletely selected
the risk tools and
techniques; did not
submit or incompletely
completed the Risk
Tools and Techniques
section of the Risk
Management Plan for
both the qualitative and
quantitative aspects of
the project. Did not
submit or incompletely
provided a rationale for
the selection.
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selection.
Weight: 15%
4. Develop
the Risk
Reviews and
Reporting
section of
the Risk
Management
Plan based
on the
project size
previously
determined.
Weight: 15%
5. Define the
Probability
and Impacts
section of
the Risk
Management
Plan and
justify the
values
assigned.
Weight: 15%
6. Define the
Risk
Thresholds
section of
the Risk
Management
Plan and
justify the
values
assigned.
Weight: 15%
7. Clarity,
writing
mechanics,
and
formatting
requirements
Weight: 10%
Did not submit or
incompletely developed
the Risk Reviews and
Reporting section of the
Risk Management Plan
based on the project
size previously
determined.
Partially developed
the Risk Reviews
and Reporting
section of the Risk
Management Plan
based on the
project size
previously
determined.
Satisfactorily developed
the Risk Reviews and
Reporting section of the
Risk Management Plan
based on the project
size previously
determined.
Thoroughly developed
the Risk Reviews and
Reporting section of
the Risk Management
Plan based on the
project size previously
determined.
Did not submit or
incompletely defined the
Probability and Impacts
section of the Risk
Management Plan; did
not submit or
incompletely justified
the values assigned.
Partially defined the
Probability and
Impacts section of
the Risk
Management Plan;
partially justified the
values assigned.
Satisfactorily defined the
Probability and Impacts
section of the Risk
Management Plan;
satisfactorily justified the
values assigned.
Thoroughly defined the
Probability and
Impacts section of the
Risk Management
Plan; thoroughly
justified the values
assigned.
Did not submit or
incompletely defined the
Risk Thresholds section
of the Risk Management
Plan; did not submit or
incompletely justified
the values assigned.
Partially defined the
Risk Thresholds
section of the Risk
Management Plan;
partially justified the
values assigned.
Satisfactorily defined the
Risk Thresholds section
of the Risk Management
Plan; satisfactorily
justified the values
assigned.
Thoroughly defined the
Risk Thresholds
section of the Risk
Management Plan;
thoroughly justified the
values assigned.
More than 6 errors
present
5-6 errors present
3-4 errors present
0-2 errors present
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Environmental Quality International in Siwa
04/2009-5607
This case was written by Professor Jonathan Story, Emeritus Professor of International Political
Economy at INSEAD. It is intended to be used as a basis for class discussion rather than to
illustrate either effective or ineffective handling of an administrative situation.
Copyright © 2009 INSEAD-Rensselaer
TO ORDER COPIES OF INSEAD CASES, SEE DETAILS ON THE BACK COVER. COPIES MAY NOT BE MADE
WITHOUT PERMISSION.
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When Mounir Neamatalla, President of the private Egyptian firm Environmental Quality
International (EQI), first set eyes on the Siwa Oasis in 1995, in the Matrouh region of Egypt in
the Sahara desert, he was enthralled. Neamatalla, a consultant who had studied environmental
management at Columbia University, was visiting the oasis on a project for the Canadian
Development Agency. He was struck by the fact that, with a few anachronisms, the community
he was visiting could easily have been the one described by Herodotus 2,500 years earlier. Here
was an ideal fit with EQI’s mandate to promote sustainable development projects wherever the
opportunity beckoned. Where others saw poverty and isolation, Neamatalla saw riches: a culture,
tradition and heritage untouched by the passage of time.
Over the years that followed, EQI designed and implemented a number of commercial ventures
aimed at promoting economic development in Siwa—one that would be in harmony with Siwa’s
environment and that would revitalise its unique cultural heritage. EQI’s approach was to draw on
the old wisdom, traditional skills and creativity of the local community, and complement them
with modern know-how to develop Siwa into a model of sustainable development that could
serve as a source of inspiration for other communities around the world. Some of these ventures
are currently being replicated by EQI in other parts of the region.
Egypt
The past few decades have seen Egypt move from a pan-Arabic, largely socialist state at war with
Israel, to an increasingly market-oriented anchor of stability in a troubled region. As one of two
Arab countries that have forged peace with Israel, Egypt has played an important role in
promoting dialogue between Israel and its Arab neighbours.The North African country is one of
the largest recipients of American aid. In 2008, it was slated to receive $1.3 billion in military aid
and another $415 million in economic assistance. With a population of 80 million, it is home to
one in four Arabs.
The population of Egypt is concentrated along the Nile river banks and is urbanizing fast as rural
inhabitants pour into the main cities of Cairo and Alexandria. From 43 million in 1980 to nearly
80 million in 2005, it is estimated by the UN to reach 100 million by the 2020s. Population
density is among the world’s highest. The urban population accounts for 42% of the total and is
growing at a rate of 1.8% per annum. Farming represents 29% of GDP, industry 22%, and
services 49%. Per capita income is $1,200 and the literacy rate is 57%. Water scarcity is a prime
concern. Roughly 96% of Egypt’s land mass is made up of desert. The only arable regions in
Egypt are the green floodplains that line the Nile basin. Urbanisation is eating into scarce arable
land and putting the environment under great stress.
Politically, Egypt is still a highly centralised republican state in the midst of a process of political
and economic liberalisation. It has already transformed from a single party to a multiparty
political system, and from a socialist to a market oriented economy. Extensive powers are vested
in the president, who is nominated by a two-thirds majority of the People’s Assembly and then
elected by popular referendum for a six-year term. Since the assassination of President
Muhammad Anwar el-Sadat in 1981, the office has been held by Mohammad Hosni Mubarak,
who has been re-elected five times. Like Sadat, Mubarak had a distinguished former career in
Egypt’s armed forces. The president appoints the government and enjoys the support of the
dominant National Democratic Party (NDP), which has secured a majority in the directly elected
People’s Assembly. The government is reported to be facing demands for political reform from
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both secular and liberal opposition parties and from the officially banned fundamentalist Muslim
Brotherhood. President Mubarak’s crackdown on opponents has led to calls for restraint from the
United States.
The Muslim Brotherhood, the strongest of the opposition groups, has spent most of its history
debarred from politics because of the country’s secular constitution. Elections in 2005 were
marred by allegations of intimidation and ballot rigging. Israel’s Ariel Center for Policy Research
concluded that Cairo had no choice but to engage in a degree of reform in order to keep
resentment at bay. Most international analysts and research institutions agree that Cairo would
benefit from engaging in significant reform.
The threat from militant Islamic groups re-emerged after a lull from the late 1990s until 2004,
when a series of bombings in the southern Sinai peninsula highlighted the exclusion of the local
population from the mass tourism development of their region. Despite sympathy for the plight of
the Bedouins, the attacks were unpopular amongst Egyptians, not least because of the damage to
Egypt’s valuable tourist industry.
The armed forces of Egypt are the largest on the African continent. The military and securityrelated budget is not public information but most published sources put Egyptian military
expenditure at 7% to 10% of GNP. In addition to the armed forces, Egypt maintains a large
paramilitary force around 350,000 strong, known as the Central Security Forces, under the
Ministry of the Interior. The National Guard and border security forces come under the control of
the Ministry of Defence and are reported to number 60,000 and 20,000 respectively.
Administratively, Egypt is divided into 28 governorates, each headed by a governor who is
appointed by the president. Within their districts, local government units establish and manage all
public utilities, provide services and designate industrial areas. Local popular councils are elected
bodies that work closely with local government administrative units at various levels.
Economically, the country is in midst of shaking off a socialist past whose heritage owes as much
to the bureaucratic tradition of the Byzantine empire as to any regard for workers’ rights. Fiscal
reforms introduced in 2005 have lowered unemployment and attracted record foreign investment.
Customs—once famously corrupt and inefficient—have been streamlined. Tariffs have been cut
and simplified. The Egyptian pound has been floated. In 2007, the country achieved growth of
7.1%, mostly due to $11.1 billion in foreign direct investment.
Yet the Egyptian economy, while growing, is weak. Although non-oil and gas exports increased
45% in the 2006-2007 fiscal year and were expected to rise from $14 billion in 2007 to $18
billion in 2008, total exports, at $27 billion, remain small when compared to similarly-sized
countries. Turkish exports, for instance, run at over $120 billion a year. Most of Egypt’s growth
has been constrained to energy-intensive industries—cement, chemicals and fertilizers—that take
advantage of high energy subsidies. The country continues to run a $16 billion trade deficit,
importing most of its meat, wood and grain, as well as much needed capital goods equipment.
That the World Bank ranked Egypt first in a list of countries introducing investor-friendly reforms
in 2007, reflected both the progress achieved and the distance left to travel. Red tape, a
proliferation of regulations and regulatory agencies, bogged-down courts, and a sometimes
whimsical decision-making system, makes operating in the country difficult and unpredictable.
The World Bank placed Egypt 126 out of 178 countries in terms of ease of doing business.
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Despite the recent growth, unemployment remains high at 9%. The median age of the population
is 24, compared to 39 in France, with only 43% of the employable labour force aged 16 to 64 in
work, against 62% in France.
Growth in manufacturing and industry tends to be capital rather than labour intensive. Labour
productivity in agriculture and services is low. Inflation is around 8% and there is widespread
concern over rising income inequalities—despite improvements recorded by the UN Human
Development Index over the past 30 years. According to the World Bank, one in five Egyptians
can not meet their basic daily needs. Absolute poverty rose from 16.7% in 2000 to 19.6% in
2005.
Tourism provides the country with a major income stream, representing 20% of foreign currency
earnings, despite the bombings in southern Sinai on the Red Sea. In 2007, Tourism Minister
Zuheir Garana announced plans to boost tourist earnings by 26% to $12 billion dollars by 2011.
Egypt aims to welcome some 14 million tourists in 2011, requiring a capacity of 240,000 hotel
rooms, compared with 11 million in 2007. Besides catering to the mass market coming to visit the
country’s famed pyramids and beaches, the minister said Egypt aimed to attract private investors
to develop eco-tourism and medical tourism. Niche, luxury and eco-projects—such as EQI’s Siwa
development—remain rare.
Siwa
The oasis of Siwa was first inhabited nearly 12,000 years ago, but only since 1986 has a road
made it accessible to the rest of the world. Siwa is part of an archipelago of oases dotting the
Sahara. From its origins as a Berber village, the green grass and natural spring water of the desert
oasis served as an ancient stopover for caravans travelling from North Africa to the Arabian
peninsula. Herodotus described it as a salt mine whose inhabitants built their homes from bricks
of salt, and home to the powerful oracle of Ammon. When Alexander the Great entered Egypt in
331 B.C., he was received like a pharaoh. He rode through the blistering heat of the desert to
consult the oracle. The oracle welcomed him in a spectacular procession and it is said that he
blessed his mission to spread his ideas worldwide.
Located in western Egypt, not far from the border with Libya, the oasis is 80 kms long and
roughly 20 kms wide, a swathe of palm and olive trees, natural springs and salt lakes surrounded
by the sands of the Sahara. The abundant water is due to the presence of a large geological
depression; most of the area lies around 20 metres below sea level.
In its centre, the crumbling Fortress of Shali dominates the village. Most of the local population
used to live within its walls until 1926, when three days of continuous rainstorms washed the
walls away, forcing the inhabitants to abandon their homes. Until recently, the fortress had not
been restored. Rather, it has been ravaged by the dismantling of its buildings as residents
abandoned them, taking with them doors, windows, and even supporting wooden beams and
cladding as they resettled on the plains around Siwa. The remains of the fortress continue
nonetheless to serve as an example of Siwa’s traditional construction techniques. The buildings
were made of a mixture of salt and mud called kershef bricks, and rock salt blocks, supported by
palm logs. Some of the medieval structures stood up to five storeys high. After 1926 the town
was rebuilt around the fortress, but further rains in 1985 marked the general abandoning of
traditional building techniques. For the reconstruction effort, mud and palm gave way to cement
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blocks.
The oasis is home to between 20,000 and 30,000 residents, up from 5,000 in the 1970s. The local
population is divided into 11 tribes, whose sheikhs provide their people with a traditional
approach to resolving disputes. The tribal judicial system is deeply respected by the inhabitants.
“We are all family,” says Abdallah Baghi, head of education in Siwa. Cairo is happy to keep this
arrangement. The sheiks receive a government salary, and the mayor—who is a government
appointee—heads the elected town council. The mayor is nominated by the provincial governor,
to whom he reports. Mayors tend to be retired military officers. While the land officially belongs
to the state, Cairo recognises the mosaic of historic ownership patterns administered by the tribes.
Residents retain their own language, Siwi, related to the Berber dialects which span the Sahara
through to Morocco. The land surrounding the villages is given over to agriculture, 300,000 date
palms and 70,000 olive trees.
For much of its history, Siwa’s location isolated it from mainstream history. From the fall of the
Roman Empire, its independence went largely unchallenged until the 19th century. Arabian
conquerors of Egypt regarded its oases as rough, impoverished desert settlements. Armies that
might have made it through the desert were repelled by the central fortress or by the paucity of
riches. The first European arrived in 1792 but the oasis was not brought into the fold of modern
states until 1840, when the Ottomans shelled its citadel and massacred its chieftains. The first
Egyptian ruler to visit Siwa was the Khedive Abbas Helmy II in the early years of the 20th
century. The Khedive laid the foundations for the Great Mosque, the first public edifice built by
the state. His grandson, Prince Abbas Helmy III, has returned from the UK to build himself a
house in Siwa. He makes a point of praying in his grandfather’s mosque.
Even then, contact with the rest of the world was limited mostly to the taxes it paid and, briefly,
to the passing armies of the World Wars. It wasn’t until 1977, when President Sadat took an
interest in the oasis, that modernity began to intrude. As part of the Camp David accords with
Israel, the Egyptian army evacuated the Sinai—which was later opened up to modern mass
tourism—and was re-deployed to the western Egyptian desert, guarding the frontier with Libya.
In 1983, a military cantonment was set up in Siwa, providing the villages with access to a
helicopter for medical needs. Soon afterwards, the Egyptian state built the asphalt road that
reached 300 kms through the desert to link the oasis with the provincial capital on the coast.
With that connection came increased attention from the state: schools, health services and a
smattering of investment—enough to begin to wear away centuries of traditional culture.
Motorbikes, cars, television, internet and mobile phones began rapidly widening the Siwis’
horizons to the rest of the world. Along with a growth in western tourist traffic, a strong reform
current of Islamic practices undermined the softer traditions of Siwan practice. The proliferation
of wells lowered the water table; ironically the pumped water flooded the lakes, pulling the salt
towards the surface, endangering cultivation and killing swathes of palm groves. Traditional
craftsmen found that fewer students were interested in learning their art.
The older generation feared that ancient Siwi values were eroding as the young generation turned
its gaze to the world beyond the oasis.
Environmental Quality International
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Among the new arrivals since the road was built was EQI, which first came to Siwa with a
consulting capacity in the 1980s and began investing in the region in 1996. EQI’s plan was to
create a suite of projects that capitalised on the oasis’ resources. By nurturing and polishing those
aspects of Siwa that it identified as marketable, the company would target the high-end of the
value chain in global tourism. Because it would rely on the undisturbed nature of the oasis it
would have to minimize its impact on the community. Materials and labour, wherever possible,
would be local.
Practices would be sustainable with the aim of preserving the local culture, heritage and
landscape. By valuing what was local, development would not come at the expense of traditional
life. The oasis would present the world with an example of how poverty could be reduced by
capitalising on local culture and safeguarding the environment. If all worked well, the road to the
oasis’s future would run through the riches of its past. Siwa would once again become an oracle,
this time for sustainable development.
EQI’s component projects, described below, attracted the attention of the International Finance
Corporation, which provided $880,000 in loans and $486,000 in technical support. They
comprise three hotels, a line of embroidered products and traditional jewellery, and the export of
organic agriculture. The company provides direct and indirect employment to more than 600
Siwans as suppliers, staff, craftsmen and women and builders. The projects at Siwa were the
consulting company’s first real investment: “a foray” in the words of Neamatalla, “away from the
world of advice and into the world of execution.”
Adrere Amellal Oasis
EQI’s Siwa centrepiece (and the only investment that did not benefit from the IFC loan) is the
Adrere Amellal Oasis, a desert lodge built at the foot of a mountainous outcrop overlooking
Siwa’s largest lake, some distance from the main settlement. The company wanted to build a
luxury lodge in the traditional style, using palm logs and blocks made from rock salt and mud.
But when it began to enquire, it found that the knowledge of traditional building techniques was
confined to a small group of old men. The ancient style was seen as archaic and expensive. New
construction employed modern materials like concrete and cement, cooled (for those who could
afford it) by air conditioning.
If EQI wanted to build in the Siwan style—and it did—the company would have to rescue a skill
that was slipping away. They began with a team of three builders, with mixed results. After the
first 20 rooms were built, the company discovered that the untreated palm logs they had used
were infested with mites; the insects were dropping from the ceiling onto the beds, hardly
acceptable in what was to be a high-end resort. Fumigation, besides being a departure from their
vision, proved ineffective, so the company consulted the village elders, who provided the
solution: if the logs were soaked in the salt lake for several days then baked in the sun for several
days, the mites would be gone. The method worked, but the initial roofing had to be torn off the
first 20 rooms so that construction could begin afresh.
The construction was ultimately successful. Not only did it provide the lodge with the elegance
and authenticity of tradition, it also revived a craft at risk of being lost. The oasis now has 150
enterprises trained in traditional building techniques. Their revival reawakened a pride in the
oasis’ cultural heritage. Increasingly Siwan builders choose to use palm logs and rock salt blocks
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instead of more modern materials, and the state governor has decreed that all new constructions
are to be built in the traditional style. This has encouraged outsiders to build tourist facilities
along traditional lines.
The hotel, which took eight years to build, began small with eight units, but quickly expanded
through word-of-mouth publicity to 24 rooms, with a maximum occupancy of 70 guests. Priced at
a range of US$ 350-450 per night, it has achieved a level of appreciation, attracting interesting
travellers from all over the world and from all walks of life – including scholars, politicians,
artists, fashion designers and even young students. In addition, the lodge is environmentally
efficient. Kept cool during the day by the thick walls, it uses no electricity. Beeswax candles are
used for lighting. Coal braziers provide heating when needed. The ceilings are made from palm
and the fixtures are made from olive wood. The swimming pool is fed by natural springs. Dinner
consists of organic food, mainly grown locally.
The lodge’s staff is also predominantly local, providing employment and advancement to 60
members of the Siwan community. Keeping salaries at local levels are key to the lodge’s financial
success. Partly because it kept expensive international staff to a minimum— primarily in a
consulting capacity for the kitchen—the hotel was profitable after just five years.
In 2005, the eco-lodge was ranked second by Conde Nast Traveler on the magazine’s list of
“Green Resorts”. In 2007, Travel & Leisure listed it among its top 20 “Favorite Green Hotels”. It
has also received the magazine’s 2006 “Global Vision” award. Most importantly perhaps, the
lodge serves as the flagship for EQI’s business model, proudly displaying Siwa’s past and culture
like roughened gemstones that, properly cut and set, provide an experience that can be found
nowhere else.
Shali Lodge and Albabenshal
The company’s second project, which was built concurrently, was another hotel, Shali Lodge, set
in a palm grove near the village of Siwa. Built once again in the traditional mud and salt brick
fashion, the hotel offers eight rooms furnished in the company’s simple, plush style to travellers
who may not have the budget for the luxury lodge in the desert. The hotel provides employment
to 20 Siwans. The IFC loan allowed EQI to add a plan for its extension that would double that
number.
Shali Lodge is a five-minute walk from the oasis’ prime archaeological attraction, the Fortress of
Shali, and the surrounding, largely crumbling traditional village. Albabenshal, another more
recently built 11-room heritage hotel, is located at the foot of the Shali Fortress, raised from the
restored ruins of derelict houses abandoned during the rains of the 1920s.
In addition to offering the company’s services to a different category of traveller, both lodges
provide the company with a presence in central Siwan life, and serve as reminders that EQI is not
an aloof proprietor of an hotel set apart from the rest of the oasis. The company also hopes that its
restoration efforts will serve as an example for Siwans looking to rebuild their old town.
Siwa Creations
In 2001, soon after EQI had built its first two lodges, the company realised that all its employees
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and partners were men. Siwan culture is very conservative and there is a strict separation of men
and women; women refused to work in the hotels or anywhere adult males were present. Seeking
to expand the company’s impact, Mounir Neamatalla turned to his sister, Laila, a jewellery
designer, who after some research, decided she would tap into Siwa’s tradition of embroidering.
Again, EQI was faced with reviving and adapting a craft that was fading from local memory.
Siwan’s fine stitching was unique, but few members of the younger generation knew how to do it.
Laila Neamatalla began an initiative whereby grandmothers were asked to train young women
artisans in the ancient tradition, and the eco-lodge began offering local products embroidered in
the traditional style to its discerning clientele. As the work flourished, she realised that quality
control would be easier if she moved her workers from their homes into a workshop.
The project took off quickly. Beginning with 50 trainees funded through a grant from the British
Embassy, within a year Neamatalla had 300 women stitching for her. Girls work in the workshop
learning the basics of quality control until they get married, after which they continue to work
from home. Traditional motifs are embroidered onto blouses, gowns, shawls, sarongs, towels,
sheets and tablecloths. Necklaces are made from buttons and semiprecious stones. Embroidered
leather is set in silver to make rings and bracelets. The products are sold not only in the lodge but
in high-end outlets in Egypt, Italy, France and England. In 2004, the Florentine haute-couture
fashion house Ermanno Scervino began incorporating Siwan embroidery into its collection.
Material is sent from Florence to Cairo, shipped to Siwa, where it is stitched and sent back to be
assembled in Italy.
In addition to reviving a fading art, the project has been an economic success for the Siwan
artisans. Fearing that if she paid her workers too much she would upset the male-dominated
economic order and trigger resentment—Laila set her initial piece rate at a level slightly less than
what a man could earn in a day. Nonetheless, payment is based on production and a productive
embroiderer can easily out-earn the men in her household.
Siwa Organic
The success with the women led to demand for something similar for the men, more than 70% of
whom worked in agriculture. EQI responded with an effort to boost local attempts at organic
production. The biggest obstacle facing the farmers, the company found, was a lack of liquidity.
Farmers would finance their agricultural inputs by selling their crops before they were planted,
sometimes with disastrous results: if the harvest fell short they might be forced to sell their land
to pay their debts. To hedge against these risks, Siwan farmers had begun to use chemical
fertilizers to maximise their yields.
Recognising this as a problem, and using funds provided by the IFC, EQI began offering to
pre-buy the crops for 40% to 50% more than the market price, provided the harvest was grown
organically. The company also started a cattle financing project to supply a source of alternative
fertilizer, as well as milk: it would buy cows for farmers to raise, after which the two parties
would split the profits. The schemes were expected to benefit 200 to 300 farmers and preserve the
region’s production of organic produce.
The company also began processing and marketing the region’s products with a line that included
olives, dates and local produce such as olive tapenade, sycamore jam, and hibiscus syrup. This
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helped to add value to traditional practices and also served the global market. Siwans traditionally
harvested their olives by stripping them directly from the branch, leaving the fruit scratched,
bruised and unsuitable for sale in Europe. So EQI asked the farmers to begin hand-picking the
olives. A local recipe for brining the olives involved much more salt than is customarily used
elsewhere, the result of the mineral’s abundance as well as a means to preserve supplies for lean
years. EQI’s recipes use a more conventional amount of salt, designed to last one season and
please the international palate.
The project reflects the premium the company puts on its image. Its benefits aren’t only economic
and don’t only accrue to the farmer – they are critical to burnishing and preserving Siwa’s image
as a place of tradition, purity and environmental awareness.
Challenges Going Forward
The biggest challenge EQI faces is helping the community in which it is located to balance
tradition against modernity. The company has tied its brand as much to the locale in which it
operates as to the enterprises it has launched. With its business model designed to introduce
guests to the ancient culture and heritage, it can’t afford to let the elements that make Siwa unique
slip away.
With its natural heritage, its geographic remoteness and historical uniqueness, Siwa has attracted
low impact tourism and a certain profile of visitor, from backpackers to jetsetters, the latter being
EQI’s target market. They tend to form an emotional connection with its Saharan charm and
make repeated trips to the oasis.
But while the company’s founders would very much like to see the oasis preserved as it has been
for millennia (to offer clients “an opportunity to travel back in time”), they also recognise the
impact of the modern world on local customs and mores. Motorcycles have begun to muscle out
donkeys on the village roads. For villagers looking to expand their homes, modern construction is
cheaper and faster to put up; only foreigners building vacation homes can be relied upon to use
exclusively local materials and traditions, as the price of local expertise and materials is beyond
the reach of the local population.
EQI has been very careful not to engage in practices that are unsustainable—it rejected
introducing an espresso machine after it discovered that it would consume as much electricity as
the rest of the lodge. But its influence is limited, not least because it is but one amongst many
outsiders operating in the oasis. Just as tourism has raised living standards, television has raised
awareness of the rest of the world, and along with it people’s expectations. The introduction of
indoor bathrooms in many homes has put a stress on the water supply, literally the lifespring of
the oasis. Protecting the way of life may mean preserving the absence of electricity and street
lighting in Siwa as an asset—a chance to see the stars and connect with the universe—but there is
little indication that residents agree.
Nor is it clear that Siwa’s traditional lifestyle can be scaled up to handle the area’s booming
population. An oasis is like an island; its natural resources are limited. There are only so many
palm trees that can be cut for roofing—importing them from outside is forbidden for fear of
introducing new pests. A debate is raging about the sustainability of Siwa’s water resources. Even
before the introduction of bathrooms, the water table was dropping; the growing number of
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farmers had simply dug too many wells. Four plants have been built to bottle the oasis’ mineral
water (some operated by the Egyptian armed forces) and sell it nationwide.
“Siwa is now literally at a crossroads,” says Neamatalla. “It can evolve to become just another
village, where the measures of progress are strictly financial, very much related to whether you
have paved streets, sidewalks and the like. Or Siwa can literally be nourished by its past,
nourished by its unique nature.”
EQI helped to put the oasis on the tourism map and others are beginning to connect the dots.
There has been a proliferation of hotels and restaurants in the last year. Children have started
running after tourists, begging for pens, candy or money. The oasis has a small landing strip,
allowing those who can hire a plane to land, and there is talk of expanding it into a full-scale
airport to facilitate the introduction of package tours. Egyptian businessmen talk of building
400-room hotels catering to the mass market.
With only 600 families, in a community of 23,000, working with or for the company, EQI doesn’t
have the leverage to decide the path the oasis will take. EQI may be able to restructure a hotel or
two in the old town, but only the state can choose whether to set up a system of incentives to
ensure the rest of Siwa develops along those lines. Government policy is set largely in the
Matrouh provincial capital, 300 kms away, where the tourism perspective is focused less on
sustainability than on volume. In the battle between tradition and modernity on which the future
of the company’s business model depends, EQI’s needs allies. Organising them to help shape
Siwa’s future is a further challenge.
Questions:
1. What are the key components of EQI’s business model as applied to Siwa?
2. Evaluate the impact of EQI’s activities on Siwa.
3. What are the local, national and global forces driving change in Siwa?
4. Going forward, what advice would you give Mounir Neamatalla?
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Environmental Quality International in SIWA
Environmental Quality International in SIWA
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