Investment Opportunities in Egypt (Final)

7/30/2019 Investment Opportunities in Egypt (Final)

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Prepared By : AHMED ALY

Under supervision of Dr : Sahra Khaleil

INVESTMENT OPPORTUNITIES INEGYPT

2009


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Background High internal liquidity Low indebtedness Important recipient of

FDI (direct and/or jointventures): between $11

billion and $12 billion Strong domestic market Bilingual and young

workforce: 32% of thetotal population is under

the age of 14, while63.5% of the populationis between the ages of15 to 64

Political stability

Egyptian economy grewby 7.2% in FY 2007/08

For the year-endFY2008-2009, growthexpected to be around

6%, and for the FY2009-2010, around 5%


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Key reasons to invest in Egypt Low-cost labour force: 20% of UK costs

Diversified sources of income: fees from the SuezCanal, tourism, private transfers, and remittances,gas and oil/hydrocarbon exports

Foreign-exchange reserves at a high levelroughly at $33 billion

Strategic location: gateway to Africa and theMiddle East

Access to one of the largest markets in the MENAregion

Low-cost energy

Financial stability and strong banking sector


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Key reasons to invest in Egypt(Contd)

Introduction of structural reforms to:

1. Streamline bureaucratic procedures

2. Tackle obstacles to higher growth

3. Promote the privatization programme4. Improve the business climate

5. Introduce multiple investment incentivestargeting the upgrading of the business

environment and modernization of the economy New natural gas reserves in the Mediterranean

to develop the hydrocarbon sector


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Sector Opportunities

1. New technologies2. Infrastructure3. Transport:a. Mass public transport

b. Ports and airports4. SMEs5. Tourism6. Consumer market:a. Consumer goodsb. Retail7. Commercial real estate development8. Education and vocational training


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New Technologies Stimulation of new industries through technology

and business parks.Smart Village Cairo is the first fully operationaltechnology and business park: 12,000

professionals run the operations of more than 100companies. By the end of 2014, this number isexpected to reach 80,000.

Since 2006, innovative ventures under

development:

1. Smart Village Cairo Financial District

2. Smart Village Damietta Business and Logistics

Park


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Infrastructure

ICT sector growing at 20% annually

Sector attracting $1 billion in FDI each year

Egypt sees the drivers for growth in the

partnerships with leading national andinternational ICT players


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Transport Under the PPP

framework, Egypt plansto build new cargo andrailways

Highly developed road

network: linked byhighways to severalneighboring countries

New infrastructureprojects:

1. The Ahmed Helmytunnel2. El-Salam bridge

(both connect theAfrican and Asian

sides of the SuezCanal.)

Further investment inthe development ininfrastructure


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Transport (contd)

Cairo international airports third terminal building

Home to more than 14 commercial ports

Handling more than 97.5 million tons of cargo ayear

First BOT (build-operate-transfer) and privately

run international airport is now operational at

Marsa Alam

Other BOT airports are in construction in Ras Sidr


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SMEs Egypt has adopted a plan that aims to develop

the potential of about 4,000 small and medium-sized factories across the country.

Trade and Industry Ministry and Federation ofEgyptian Industries are developing a blueprintthat involves helping factories in various industrialsectors to improve performance, productivity andquality of product.

Blueprint will ensure the adoption of up-to-dateproduction and management methods.


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Tourism Strong growth in thetourism sector: 25%

increase in touristarrivals due to specialofferings and affordable

prices Increase in annual

tourist arrival from 9.8million in June 2007 to12.3 million in June2008

Sector represents11.3% of GDP

Employs 13% of thetotal workforce


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Consumer market

Egypt has one of the most important and

promising consumer markets in the region

Attracting large international companies such asWal-Mart

Sector had a total of 40% growth rate over the

past three years

Egyptian consumer market is the first in Africa

and second in the Arab region


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Commercial real estate development

Great potential for investment in the property

market: stable investment with good growth rates.

Low property prices starting at around only30,000 such as in: Hurghada, Sahl Hasheesh

(Red Sea coast)

Less property taxes than in the UK

British residents avoid inheritance tax on any

property in Egypt


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Education and vocational training World Economic Forum (WEF) Egyptian Education

Initiative (EEI): PPP initiative between the Egyptiangovernment and WEFs ICT community to reform theeducation system:

1. 70% of the planned infrastructure achieved(connecting 2,000 schools to the internet, deliver39,000 PCs to schools)

2. 65% of the training opportunities accomplished(train 64,000 teachers on ICT in education level)

The Technical and Vocational Education andTraining UK (TVET) project aims to enhancecompetitiveness of Egyptian enterprises on both thedomestic and international markets throughimproving quality of vocational training, as well as

quality and structure of Egypts labour force.


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USEFUL LINKS

Arab-British Chamber of Commerce:

http://www.abcc.org.uk

Beltone Financial:

http://www.beltonefinancial.com

British Egyptian Business Association:

http://www.beba.org.eg

Egypt State Information Service:

http://www.sis.gov.eg/En/Default.htm

General Authority for Investment and Free Zones:

http://www.gafinet.org/index.htm

Ministry of Finance:

http://www.mof.gov.eg/english

Ministry of Foreign Trade and Industry:

Investment Opportunities in Egypt (Final)

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