INVESTOR RELATIONS

INVESTMENT

  The investment climate in Egypt has witnessed major legislative and institutional reforms, with a tangible impact on both the level of domestic investments, as well as inflows of foreign direct investment (FDI). The Egyptian economy has also been receiving historically unprecedented levels of FDI inflows,As a result, confidence in the Egyptian economy has been strengthened by the key role played by the Egyptian government, in terms of improving the outlook for Egyptian, Arab and foreign investments, as well as instigating and sustaining high levels of growth and employment opportunities.

Investors have responded positively to this business environment in Egypt, with close to half of companies operating under the umbrella of the governing investment legislations that have been established during the last four year-period. A positive response to streamlining investment procedures has been reflected in the increase in the number of newly established companies as well as expansions undertaken by companies already in operation.


  • +Macroeconomic stability and Robust Growth



      In light of the worldwide economic downturn, Egypt experienced minimal decline and in contrasts with many economies around the globe emerged resident and full of opportunity. Egypt's GDP fell from 7.2% in 2007/2008 to 4.7% 2008/2009 but it recorded 5.1% in Q3 2009/2010 and projected to reach 6.5% by 2015. Among the nation's fastest growing sectors are construction, communication and information technology, tourism, manufacturing and transportation.

    Despite the economic crisis affecting all economies, the unemployment rate in Egypt decreased from 9.4% Q4 2009 to 9.12 Q1 2010. Egypt's ranking rose 22 places on the financial market sophistication indicator in the Global Competitiveness Report by the World Economic Forum in 2009, indicating that there is both a high level of growth and sophistication in the Egyptian market.


  • +A large, Trained, Competitively Priced Labor Force



      At about 25 million, Egypt's labor pool is the largest in the region. For decades, Egypt has had a reputation as a net regional exporter of educated, skilled labor. However, as domestic demand for skilled labor rises, young people are increasingly choosing to pursue opportunities at home. Complementing world-class universities and technical schools, a new national industrial training program is training workers to fill some 500,000 new jobs in manufacturing.

    Each year, around 324,000 Egyptians obtain university degrees, of whom 16,000 are trained engineers and 14,000 have degrees in science and technology. In addition, 22,000 graduate with European language skills.

    Skills-intensive and service-based sectors such as CIT, financial services and tourism are among Egypt's economic leaders. Wages in these sectors are very competitive and more stable than wage levels in competitor countries.

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  • +Large consumer market



      Egypt has emerged as a consumer market of significant importance in the region, as witnessed by the arrival of dozens of global brands and the sharp expansion of retail sales in the past two years. This is partly due to the sheer size of Egypt's population that put it as the most populated country in Africa and the Middle East, as well as Per capita income that reached EGP 13648 in 2008/2009 from EGP 5544 in 2000/2001. the fact that 50% of Egyptian are between the age 15-44 has also impacted spending and investment trends.

                                                                                             

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  • +Developed Infrastructure



      Egypt boasts a broad, world-class infrastructure base. Three independent mobile (cellular) phone networks cover nearly 100% of the country's inhabited land. Wireline broadband is readily available in urban centers. The country's 15 commercial ports serve the nation's exporters and importers alike, while an expanding, upgrading airport network caters to both passenger and cargo traffic. Egypt also provides competitively priced and reliable supplies of power, water and gas.

    Competitive tax rates:
    • Corporate and personal taxes each top out at only 20% in Egypt. Personal taxes have been cut from 32% to 20%, while corporate taxes have been slashed from 42% to 20%. The nation's newly overhauled tax code is easy to navigate, and the country has moved to random-sample auditing. The nation's largest corporate taxpayers are served by a special, highly trained unit at the Tax Authority.

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  • +Preferential access to Key Global Markets



      Egypt has access to large key markets through various multilateral and bilateral trade agreements with the USA, European, Middle Eastern and African countries; which secures benefits to Egyptian-based producers supplying these markets.

    - Egypt's Preferential Trade Agreements.

    Proximity to global Markets:

    Key global markets in Europe, the Middle East, Africa and the Indian Subcontinent are all readily accessible from Egypt. Closer to the European and North American markets than other major exporters including India, China and the Philippines, Egypt is also located on key international logistics routes.

    Egypt enjoys the existence of the Suez Canal, which is considered to be the shortest link between the east and the west due to its unique geographic location. Over 8% of the world's maritime shipping passes through the Suez Canal each year.

    Vessels transiting through the canal from east to west or from west to east make significant savings in distance, time and operating costs.

    Moreover, the maritime transport is the cheapest means of transport, with more than 80 % of world trade volume transported via waterways (seaborne trade).


  • +Diversified Economy



      Egypt's economy is among the most diverse in the Middle East and North Africa, helping ensure long-term growth prospects and stability for all sectors. In 2008/2009 the Industrial Sector accounts for 16.6% of GDP while CIT, tourism and financial services accounts for 10.2% from GDP and retail accounts for 11.5% and 13.7% for agriculture.


  • +Reformist Investment Climate



      In light of an expanding economy and unexploited opportunity for investment, Egypt is climbing the ranks as an ideal location for doing business. Ranking 24 for starting a business by World Bank 2010 report, (up 19 points from 2009), Egypt has risen dramatically and is recognized as an attractive market to invest in with its appealing governmental incentives. The World Bank doing business 2010 report tracks 183 countries giving Egypt the 106th, while naming Egypt among the top ten reformist in the world for the third consecutive year.

    Egypt was the first Arab and first African country to sign the OECD declaration on international investment and multinational enterprises. With high levels of Foreign direct investment (FDI) despite the global economy crisis, it increased from USD 11.1 billion 2006/07 to USD 13.2 billion 2007/08. 2008/09 saw a light dip USD 8.1 billion with respect to the global economy crisis.

    In 2008/2009 Egypt ranked the number one destination to North Africa, the 2nd in Africa, and the third among the Arab nations according to UNCTAD.

    According to Moody's credit rating agency, Egypt's sovereign credit rating outlook has changed from negative to stable. This improvement would positively affect the sovereign credit rating of local and foreign currencies in Egypt (Ba1), the credit rating of bank deposits in foreign currency (Ba2) and the credit rating of bonds in foreign currency (Baa2).

    In August 2009, Egypt was ranked first in North Africa and second best destination for foreign direct investment (FDI) in the African continent for the FY 2009/10, after South Africa, in terms of investment climate attractiveness, according to "African Countries of the future 2009-2010" report by FDI Intelligence. The study considered numerous criteria when measuring such a rank, including infrastructures, local strategies for encouraging FDI, the economic potential of the country, human resources, living standards and market openness.


  • +Political Stability and Personal Security



      Political stability allows businesses to be confident that the economic policies that attracted them to invest in Egypt will remain in place. Moreover, Egypt's crime rate is low by any standard, and Cairo is one of the safest large cities in the world, making it easy for multinational corporations to convince key staff members to accept long-term posting here.