Transcript Diapositive 1

Egypt, Investment for Development
Doing Business with Egypt
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Greece 16 - 18 October 2014
Indicators
•
Monthly Inflation Rate 10.07 % at the end of August 2014
•
Net International Reserves 16.87 (USD billion) at the end of
Sept 2014
•
Net Foreign Direct Investments during the FY 2012/13
GDP Growth Rates
reached (3.8 billion USD) and (4.1 billion USD) the FY
2013/14:
•
Unemployment Rate 13.4% during Jul-Sept. FY2013/14
•
Total exports (FY2012/2013 ) 26.0 USD billion ,
and recorded 18.7 USD billion during the 9 months of the FY
2013/14
•
Total imports (FY 2012/2013) 57.5 USD billion , and
recorded 43.9 USD during the 9 months of the FY 2013/14
2.20%
2.1%
1.80%
2010/11
2011/12
2012/13
Foreign Direct Investment in Egypt
USD Billion
9
8
8.1
6.8
7
6
5
4
3
4
3.8
2012/2011
2013/2012
4.1
2.2
2
1
0
2009/2008
3
Source : CBE
2010/2009
2011/2010
2014/2013
Greek Investment in Egypt
From January 1970 till August 2014:
• Total Greek participation in the issued capital is USD 613.23 Million
• Total number of companies with Greek capital operating in Egypt is 140
companies
Greek Investment Development in Egypt
Greek Investment by Sector
Others; 2%
79.3
Services; 4%
Tourism; 5%
45.6
36.2
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34.1
26.5
22.3
18
12
4.3 5
2006
2007
2008
2009
Issued Capital
Source : GAFI
Industry; 6%
7.2 12
6
8
2010
2011
2012
11
0.4 2
2013 -
Number of Companies
Finance; 83%
Sample of The largest international Companies working in Egypt
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Support and Incentives for Investments
• The process of registering foreign company subsidiaries to only three days of
processing time.
• The time to open foreign representation offices; 3 days while simplifying
administrative steps related to establishing a business.
• Enhancing import and export flexibility through import and export certificates
that are available for 3-5 year periods.
• Paying subscription fees to chamber of industry and the federation of Egyptian
industries at the one stop shop
• Increasing GAFI’s processing centers.
• Lifting the security approval requirement for media companies. As well as lifting
licensing requirements for print publications.
• An initiative to provide resources for a credit risk guarantee program to help
develop SMEs and help them gain access to bank financing.
Investor protection
• There are five investor protection schemes which GAFI is currently endorsing:
1. Investor Care Department: established within GAFI to support and guide
investors to resolve any conflicts they might face with the different
governmental authorities.
2. Disputes Settlement Center: established in 2009 for the reconciliation and
disputes resolution between business partners.
3. The Investment Disputes Resolutions Committee: which GAFI hosts its the
technical secretariat.
4. The “Contracts Committee” which GAFI is a member of, to resolve any conflict
that might arise between the investors and different governmental bodies over
previously signed business contracts.
5. Modification of the Investment law No. (8) year 1997 to allow the reconciliation
between the investor and the government in the cases of proven fraud.
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Ambitious sectorial strategies
INDUSTRY: Textiles
• 30% of industrial output
• 14.2% of Non- Petroleum exports in first three quarters of
2011/2012
• 30% of local employment in 2010
• Egypt is home to the only fully vertically integrated textiles
industry in the Middle East.
ICT: DIGITAL Egypt 2013
• One of the highest-growth potential IT markets in the Middle
East.
• has an annual sustained growth rate of 11.53% during q1 of
the FY 2013/14
• contributes 2.7 % to real GDP.
 Egypt offers easy access to markets in the Arabian
Gulf, the Levant, North Africa and Sub-Saharan Africa
as well as Europe.
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Ambitious sectorial strategies
RENEWABLE ENERGY
• 20% of total power generation by 2020
• 12% of which will be generated by wind energy
• To boost US$110bn of investment into the power sector
by 2027
• The leader producer: as Egypt produces almost 57% of
the region’s total wind energy
Objectives:
FINANCE
• one of the oldest and most-established in the Middle
East
• The nation’s banks, brokerages, investment banks and
private equity houses are among the most vibrant in the
region.
• Smart village the premiere technology park in the middle
east.
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Ambitious sectorial strategies
LOGISTICS
• Unique geographic location combined with an expanding
infrastructure bas
• 8% of the world’s maritime shipping passing through the
Suez Canal.
• Accounting for 6.2% of GDP during q1 of the FY 2013/14.
• The government is planning investments of EGP 37.8 Bn.
in the transportation sector during the FY 2013/14
TOURISM
• Accounting for 2.2% of total GDP during q1 of the
FY 2013/14.
• Achieved growth rate of 10.2 during (Jul‐Mar)
2012/2013.
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Ambitious sectorial strategies
AGRICULTURE
• Egypt represents one of the largest markets in the
region, agriculture contributes to around 18.1% of
Egypt's GDP in q1 2013/2014.
• Food production industry in Egypt is better developed
than that in many neighboring states, creating strong
export opportunities.
• 6130 companies operating in the Agribusiness space in
Egypt With total capital reaching EGP 50 billion and
manpower of 5 million
Education
• Egypt has a long history as an exporter of well-educated
labor.
• Egypt has a diverse base of educational system that
guarantees both a large pool of people who can teach
and conduct training programs.
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Ambitious sectorial strategies
RETAIL
• Egypt is the largest market in the Arab world With
a population of 84mn.
• Booming retail sub-sectors include autos as sales
forecast to increase by 126% between 2012 and
2016, over-the-counter (OTC) pharmaceuticals,
with sales expected to grow by 96.6% from by
2016, and consumer electronics sales are forecast
to increase by 50.8% in 2016.
• Wages in the wholesale and retail sector average
US$ 32.20 weekly.
Real Estate
• Total investments directed to the real estate sector in
the FY 2011/12 reached 17% of the total
implemented investments.
• housing needs expected to climb to 8 million in 2022.
• 27 new urban cities are planned of which 5 under
construction
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Special Economic Zone in Egypt
Incentive benefits in SE Zone
 The ZONE is strategically located on
the main international ocean trade
routes, promises to be a key
benchmark in the evolution of
Egypt.
 5% flat tax rate on personal
income tax and 10% tax on all
activities within the zone
 Zero Import Duties.
 Zero Export duties when exporting
out of Egypt .
 Zero Export duties on domestic
components when sold in Egypt.
 Integrated custom and tax
administration, licensing, and
dispute settlement
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A business environment favourable to investment
Investor
Protection
Legal Reforms
An Incentive Tax
System
• 5 main investor protection schemes endorsed by GAFI
• 52 Double Tax Avoidance Agreements
• 111 Investment Protection Agreements
• Member of OECD Investment Committee
• Member of MIGA (Multilateral Investment Guarantee Agency)
• A stimulus package introduced by The Ministry of Industry to facilitate investments in the
industrial sector
• Lifting the security approval requirement for media companies.
• The issuance of the new financial tool “SUKUK”.
• processing reforms related to the technical operations at GAFI`s one stop shop
• incentives for taxpayers on the full or partial payment of their deferred
income/sales taxes
We are optimistic that Egypt's program`s objectives of promoting social justice, fostering
recovery, and maintaining macro economic stability and generating jobs will bring
positive results for the Egyptian people.
John Lipsky, Acting managing director of the IMF, June 2011
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Thank you for your attention
www.gafi.org.eg
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