UA-R-GC-1914-01-01-1977-05-12_Page-004

to put this project back on the tracks. There is reason to hope that this investment can be set straight and will be profitable. Cadillac Travel can be considered to be a failure as an invest ~ ment, and the Fund ;s in the process of liquidating its investment and hopes to recoup most of the funds that have been put into the project. Liquidation has not yet been completed, however the reasons for the delay are deemed satisfactory. , The Fund has not yet been able to present a satisfactory conso­lidated dollar and pound budget and it is hoped that such a document will be available at the October meeting. However it should be borne in mind that venture capital operations require a long lead time before they become pro~ fitab1e; moreover, in view of the high inflation rate in Egypt the Fund has little choice but to invest in equity projects in an attempt to insulate the endowment from the effects of such inflation. Such investments typically take a long time to yield returns. For 1978 the Fund projects a profit in Egyptian pounds and as of this time projects a deficit in dollars. It was stressed that the Fund is in business to invest Egyptian pounds and that its income will be largely in pounds, and that while it is hoped that there will be opportunities for the Fund to earn do1lars t it may be necessary to subsidize the dollar side of the Fund in order for it to earn pounds. Mr. Hedlund summarized the conclusions of the LE Endowment and Finance Committees by saying that the Fund is in a much more orderly position than it was a year ago and that, considering the difficulties of launching a new venture capital organization in Cairo, it is doing satisfactorily