Transcript Slide 1

Doing Business in
Egypt
Rundown
Why Egypt
Egypt’s Integration in the World
Economy
Economic Outlook
Investment Incentives
Investment Opportunities
Egypt and Serbia
Why Egypt
• Unique geographic location
At crossroads/gateway to Africa, Asia,
Europe & Middle East
Why Egypt
•Political stability & one of most promising
emerging markets
•Stable friendly business environment
private sector led economy & competitive
incentives offering favorable climate for
investors & joint venture partners
• Diversified expanding economy, local
market of 80 million & accessibility to vast
markets of one billion in different trade blocks
(COMESA, EU, Arab region…)
Why Egypt
•Competitive advantages
Raw materials, land, large pool of
competitively priced labor force (skilled &
semi-skilled), maritime, airfreight rates,
electricity, tele-tariffs…
• Advancing infrastructure
Telecommunications, IT, electricity, roads,
ports, banking & capital market…
Egypt’s Integration in the World Economy
• Adoption of bilateral, regional &
multilateral approach to trade &
investment liberalization:
– WTO (member since June 30th 1995)
Egypt’s Integration in the World Economy
• Free-Trade blocks
– COMESA: largest economic grouping in
Africa with 400 million people
– EU: Free and Preferential Trade
Agreements
– Arab World: Free Trade Area Agreement
– USA: Trade & Investment Agreement
– Qualified industrial zone
– Free Trade Agreement with Turkey
– Free Trade Agreement with EFTA countries
Economic Outlook
• Early nineties, Egypt launched multi-phased
economic reform program focused on
macroeconomic adjustments & stabilization,
privatization & trade liberalization, market
driven economy
•
Successful program applauded by
international institutions: IMF “as an
achievement that has few parallels”
Economic Outlook
Gross Domestic Product (GDP) at market
prices (current prices) (L.E Billion )
Exchange rate 1USD=5.45 Egyptian Pounds
Economic Outlook
Real growth rate of Gross Domestic Product
(GDP) at market prices and constant prices (%)
Economic Outlook
GDP – composition by
sector:
agriculture: 13.2%
industry: 38.7%
services: 48.1% (2008 est.)
13.2%
Agriculture
48.1%
Industry
38.7%
Services
Economic Outlook
Per capita income (current prices)
(Egyptian Pounds)
Exchange Rate 1USD=5.45 Egyptian Pounds
Economic Outlook
EGYPT IMPORTS FROM THE WORLD
from 2005 to Jan. Sep. 2009
Total imports:
2008: 52915.66 million USD
Jan-June 2009: 32692.70 million USD
Economic Outlook
EGYPT EXPORTS TO THE WORLD
from 2005 to Jan. Sep. 2009
Total exports:
2008: 26209.60 million USD
Jan-June 2009: 16478.20 million USD
Investment Incentives
Types of Investment in Egypt:
1. Free Zones investment system
2. Inland investment system
Types of Free Zones in Egypt:
1. Public
2. Private
Egypt Free Zones: 10 Free Zones
Investment Incentives
Investment Incentives
• Enterprises wholly owned by foreigners
• Guarantees against nationalization or
expropriation
• Output not subject to price control
• Repatriation of capital and profits
Investment Incentives
Tax exemptions as follows:
*
5-year exemption of the projects set up in the
Old Valley
* 10-year exemption of the projects established in
the industrial zones of new communities or remote
areas.
* 20-year exemption of the projects set up in the
New Valley (hka, East Owainat, Paris, Kharga,
East Farafra and Siwa).
* Life exemption of the projects established in free
zones.
Investment Incentives
Free Zones objectives:
1. Increase Egyptian exports
2. Attract foreign capital, achieve accrued
capital
3. Introduce new technology specially in
the industrial field
4. Provide employment opportunities,
generate a substantial skill surge
Investment Opportunities
Investment Opportunities
The Projects Tendered for Investment
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•
Engineering and Electronics Sector
Metal Projects Sector
Spinning & Textile Sector
Food Projects Sector
Chemical & Pharmaceuticals Projects
Sector
Investment Opportunities
Automobile Assembly
Highly profitable – Passenger cars, buses,
mini-buses: GM, Peugeot, Mercedes Benz,
BMW, Suzuki, Hyundai…
Construction Materials
Fast growing - steel, reinforced iron,
cement, ceramics…
Additional Opportunities
Juices, leather, chemicals, glass, paper, vessel &
ship building & maintenance, granite, marble…
Mining
Varied & abundant mineral deposits: iron ore,
phosphate rocks, coal…
Agriculture
• Emerging key regional exporter of primary &
secondary food produces
• Ambitious projects expanding Arable land &
creating new communities
Opportunities
• Mega projects: land reclamation in Toshka,
Sinai & East Owaynat
• Transportation services, advanced screening,
wrapping, packing & storage techniques
• Fisheries, fish farming in different lakes: Lake
Nasser, Karoon, Burolns, etc…
Tourism
Favorable tourist destination for its variety of
attractions & wonders, weather, cultural activities
& museums, safari, therapeutic, religious, golf,
conferences & exhibitions, shopping, etc…
Opportunities
Development of new resorts for beach & leisure
tourism: Marinas, Scuba diving centres, golf, etc…
Egypt and Serbia
•Distinguished political relations
•Presidential and ministerial visits
•Reviving of relations so as to reach Golden age during
50’s and 60’s.
Egypt and Serbia
• Egypt is a favourable tourist destination for Serbian
citizens (22.2 thousands tourists in 2009)
• Easy access to Egyptian visa
• Charter flights
• Attempts to start direct flights between two countries
Egypt and Serbia
There are a number of agreements that aim to foster
economic and trade relations and attract investments
from both sides which are as follows:
1. Agreement for Long-term Commercial and
Economic Cooperation, signed on June 26th 1957
2. Agreement on Establishing the Joint Committee
for Economic Cooperation, signed on March 21st
1961
3. Agreement on the reciprocal promotion and
protection of investment, signed on May 24th 2005
4. Agreement on the Avoidance of Double Taxation
with respect to taxes on income, signed on July
31st 2005
Egypt and Serbia
Trade Balances between Egypt and Serbia
Year
Egyptian Exports
from Serbia
millions of USD
Egyptian Imports
from Serbia
millions of USD
Trade Balance
millions of USD
1990
41.7
93.3
135
1991
32.4
71
103.4
1996
9.2
20.6
29.8
1997
4.9
36.9
41.8
1998
3.2
25.3
28.5
1999
1.7
13.1
14.8
Year
Egyptian Exports
from Serbia
millions of USD
Egyptian Imports
from Serbia
millions of USD
Trade Balance
millions of USD
2000
2.6
14.6
17.2
2001
3
11.5
14.5
2002
3.4
9.1
12.5
2003
2.7
7.1
9.8
2004
3.6
19.2
22.8
2005
4.9
21.3
26.2
Egypt and Serbia
Year
Egyptian Exports Egyptian Imports
to Serbia
from Serbia
millions of USD
millions of USD
Trade Balance
millions of USD
2006
9.1
26
35.1
2007
13.1
20
33.1
14.2
14.2
36.5
50.7
2009
Until
June
30th
4.7
13.9
18.6
Egypt and Serbia
Most important exports to Serbia in 2009
• rice, soap, paper, beans oranges, strawberries, herbs,
ceramic tiles, salt, polyethylene, aluminum, dried onion, cotton,
granite, mint, iron and steel powder, conserved olives, artificial
cement, conserved tomatoes, textiles, etc.
Most important imports from Serbia in 2009
• processed beech woods, tractors, tires, brass plates,
copper pipes, motor parts, brass wires, breathing apparatus,
protection masks, hydraulic generators, air filters, rubber
products, rubber belts and strips for transports, etc.
Egypt