UA-R-GC-1914-01-01-1979-05-31_Page-006

, . -6- can live with them satisfactorily. The new Director of the American Schools and Hospitals Abroad Program, Mr. David Santos, seems well disposed towards the University, and relations with him are thought to be good. The Fund is proceeding with its first new major investment in three years--British Chloride. This company is the largest manufacturer of auto­motive batteries in the world. It is setting up such a plant in Egypt in conjunction with the state-owned factory. The Fund is contemplating a loan of LE 2 million and an equity investment of LE 640,000 in this project. This is typical of the kind of investment that the Committee believes the Fund should be making in the future, i.e., minority participation in a project led by a major international company which supplies expertise and management. Under new ground rules developed with AID, they have been informed of the fact that the Fund management, MEFCA and the LE Investment Committee intend to proceed with the investment, and have been furnished with a detailed summary of the project. If AID does not specifically object, then the Fund proceeds on the assumption that it will be participating. In general, Mr. Stone believes that the Fund will be more heavily involved in loans than in equity in the future. The Fund's tax position must be kept clearly in mind in this regard. The Fund has the advantage of being able to participate in equity investments which promise far higher yield than income from loans. President Pedersen is looking into the Fund's tax situa­tion in Egypt and trying to obtain tax concessions or advantages for the Fund. During the present year the Fund has operated within its budget. Mr. Stone summarized the Fund's current investments, noting that there is little change from the picture presented in Cairo in February. Cadillac Travel and Touristic Services is effectively liquidated