Investors seminar

During an investor seminar hosted by the Egyptian-British Chamber of Commerce in London, President of the General Authority of Investment and Freezones (GAFI) Hossam Heiba shared his insights on the investment climate in the country, specifically with regards to the available investment opportunities and the recent efforts exerted by the Government to promote investments and industrialization including the ‘Golden License’.

In light of the Government’s vision to attract USD 10 billion as a net value of foreign direct investment (FDI) by the end of this year (up from USD 8.9 billion in 2022, the highest figure reached since 2011), the session acted as a platform for GAFI to engage with investors and providing them with a better understanding of the available investment opportunities and the potential for growth and profitability in Egypt behind its remarkable strategic location, large consumer base, availability of a skilled workforce, and the adopted investment-friendly policies.

Under its conducive reform program undertaken in 2016 with the aim of bringing stability into the country after the experienced social and political turmoil, Egypt managed to secure a stable political environment and has embarked on an infrastructure upgrade plan to attract investors, including roads and industrial cities, with 20,000 km road network being in plan by 2030, 60-70% of it having been almost reached. With respect to commercial ports, Mr. Heiba highlighted that the Mediterranean and Red Sea ports were all upgraded. In addition, the Government has managed to overturn the energy deficit experienced in 2015 by now having a surplus of around 5 gigawatts, 20% of which being generated from wind and solar energy.

With the target of attracting investments, the Government took over pushing investments into the economy given that the private sector participation was still limited at the time during 2016, but now the Government plans for the private sector to contribute to around 65% of the GDP. The ongoing geopolitical global challenges led to a huge strain on the national economy given that Egypt imports around 70% of its basic food supplies. To mitigate such challenge, the Egyptian Government expedited its plans to farm around 2.5 million feddans, with around 600,000 feddans being accomplished in the last 5 years, which led to an increase in GDP to reach USD 480 billion, an average of 5% annual increase.

Besides that, the Government worked on luring investments into Egypt, with the FDI inflows reaching USD 22 billion, in addition to providing USD 13 billion for capital outflows. The challenges posed on the availability of the foreign currency in the national economy has led the country to work on revamping its investment strategy and policy by conducting tailor-made activities into specific locations that the country is looking to grow, such as the Suez Canal Economic Zone’s area. Mr. Heiba also highlighted that Egypt has a diversified economy with ample natural energy resources, skilled manpower, great strategic location, strong presence in the African continent at large, and numerous signed trade agreements, which makes it a favorable for investors.

To further incentivize investments, the Government has introduced various incentives including introducing tax credits, waving certain fees and taxes, enabling more than the current legislations allow for foreign workers to work specifically in green hydrogen projects, in addition to other incentives. Before end of July, GAFI is working on amending an existing law with the aim of providing offshore companies with the opportunity to operate out of Egypt with zero taxes and customs, enabling them to operate in foreign currency and under any government law the company wants to implement. Besides working on updating Egypt’s Investment Map portal such that it enables private sector companies to list their opportunities, GAFI currently holds permanent forums and dialogues with the private sector in order to attend to the needs and challenges faced by the private sector in Egypt in light of GAFI’s mandate. Accordingly. Mr. Heiba alluded that the IPO program holds tremendous investment opportunities for British investors, especially with the UK being Egypt’s top investment partner.