Industry-Specific Reforms
20 Industry-Specific Reforms
Industry-Specific Reforms
Pharmaceutical Industry
6 Challenges(s)
Challenge(s)
- Registration of new pharmaceutical products is a very lengthy process even though these products have already been approved and licensed in developed countries, which should serve as a solid reference for pharmaceuticals quality control testing.
Recommendation(s)
- Grant instant approval of pharmaceutical registration applications if the product concerned is registered in any two countries that are considered advanced in the pharmaceutical industry.
- Reform the registration process of pharmaceutical factories. The process should entail submitting a Common Technical Document (CTD) dossier and payment of LE 120,000 registration fee; the ‘Box' system should be discarded in the process. The registration process should be completed in less than six months, and there should be a no set limit on the number of dossiers that can be submitted each month.
- Pharmaceutical factories should obtain international accreditation from the World Health Organization (WHO), the U.S. Food and Drug Administration (FDA), GTA, and the European Medicines Agency (EMEA).
Challenge(s)
- Registration of new pharmaceutical products is a very lengthy process even though these products have already been approved and licensed in developed countries, which should serve as a solid reference for pharmaceuticals quality control testing.
Recommendation(s)
- Grant instant approval of pharmaceutical registration applications if the product concerned is registered in any two countries that are considered advanced in the pharmaceutical industry.
- Reform the registration process of pharmaceutical factories. The process should entail submitting a Common Technical Document (CTD) dossier and payment of LE 120,000 registration fee; the ‘Box' system should be discarded in the process. The registration process should be completed in less than six months, and there should be a no set limit on the number of dossiers that can be submitted each month.
- Pharmaceutical factories should obtain international accreditation from the World Health Organization (WHO), the U.S. Food and Drug Administration (FDA), GTA, and the European Medicines Agency (EMEA).
Challenge(s)
- Registration of new pharmaceutical products is a very lengthy process even though these products have already been approved and licensed in developed countries, which should serve as a solid reference for pharmaceuticals quality control testing.
Recommendation(s)
- Grant instant approval of pharmaceutical registration applications if the product concerned is registered in any two countries that are considered advanced in the pharmaceutical industry.
- Reform the registration process of pharmaceutical factories. The process should entail submitting a Common Technical Document (CTD) dossier and payment of LE 120,000 registration fee; the ‘Box' system should be discarded in the process. The registration process should be completed in less than six months, and there should be a no set limit on the number of dossiers that can be submitted each month.
- Pharmaceutical factories should obtain international accreditation from the World Health Organization (WHO), the U.S. Food and Drug Administration (FDA), GTA, and the European Medicines Agency (EMEA).
Challenge(s)
- Registration of new pharmaceutical products is a very lengthy process even though these products have already been approved and licensed in developed countries, which should serve as a solid reference for pharmaceuticals quality control testing.
Recommendation(s)
- Grant instant approval of pharmaceutical registration applications if the product concerned is registered in any two countries that are considered advanced in the pharmaceutical industry.
- Reform the registration process of pharmaceutical factories. The process should entail submitting a Common Technical Document (CTD) dossier and payment of LE 120,000 registration fee; the ‘Box' system should be discarded in the process. The registration process should be completed in less than six months, and there should be a no set limit on the number of dossiers that can be submitted each month.
- Pharmaceutical factories should obtain international accreditation from the World Health Organization (WHO), the U.S. Food and Drug Administration (FDA), GTA, and the European Medicines Agency (EMEA).
Challenge(s)
- Registration of new pharmaceutical products is a very lengthy process even though these products have already been approved and licensed in developed countries, which should serve as a solid reference for pharmaceuticals quality control testing.
Recommendation(s)
- Grant instant approval of pharmaceutical registration applications if the product concerned is registered in any two countries that are considered advanced in the pharmaceutical industry.
- Reform the registration process of pharmaceutical factories. The process should entail submitting a Common Technical Document (CTD) dossier and payment of LE 120,000 registration fee; the ‘Box' system should be discarded in the process. The registration process should be completed in less than six months, and there should be a no set limit on the number of dossiers that can be submitted each month.
- Pharmaceutical factories should obtain international accreditation from the World Health Organization (WHO), the U.S. Food and Drug Administration (FDA), GTA, and the European Medicines Agency (EMEA).
Challenge(s)
- Registration of new pharmaceutical products is a very lengthy process even though these products have already been approved and licensed in developed countries, which should serve as a solid reference for pharmaceuticals quality control testing.
Recommendation(s)
- Grant instant approval of pharmaceutical registration applications if the product concerned is registered in any two countries that are considered advanced in the pharmaceutical industry.
- Reform the registration process of pharmaceutical factories. The process should entail submitting a Common Technical Document (CTD) dossier and payment of LE 120,000 registration fee; the ‘Box' system should be discarded in the process. The registration process should be completed in less than six months, and there should be a no set limit on the number of dossiers that can be submitted each month.
- Pharmaceutical factories should obtain international accreditation from the World Health Organization (WHO), the U.S. Food and Drug Administration (FDA), GTA, and the European Medicines Agency (EMEA).
Industry-Specific Reforms
Cosmetics Industry
4 Challenges(s)
Challenge(s)
- The cosmetics registration process is unnecessarily long and costly and hinders the expansion and competitiveness of the local industry.
Recommendation(s)
- Registration of cosmetics should be based on the product formula rather than the product Stock keeping Unit (SKU); instant approval of registration applications should be granted if the product is registered in any two developed countries.
Challenge(s)
- The cosmetics registration process is unnecessarily long and costly and hinders the expansion and competitiveness of the local industry.
Recommendation(s)
- Registration of cosmetics should be based on the product formula rather than the product Stock keeping Unit (SKU); instant approval of registration applications should be granted if the product is registered in any two developed countries.
Challenge(s)
- The cosmetics registration process is unnecessarily long and costly and hinders the expansion and competitiveness of the local industry.
Recommendation(s)
- Registration of cosmetics should be based on the product formula rather than the product Stock keeping Unit (SKU); instant approval of registration applications should be granted if the product is registered in any two developed countries.
Challenge(s)
- The cosmetics registration process is unnecessarily long and costly and hinders the expansion and competitiveness of the local industry.
Recommendation(s)
- Registration of cosmetics should be based on the product formula rather than the product Stock keeping Unit (SKU); instant approval of registration applications should be granted if the product is registered in any two developed countries.
Industry-Specific Reforms
Medical Devices Industry
10 Challenges(s)
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Challenge(s)
- Currently, the government is heading in the right direction with regard to transforming the domestic single-use syringes industry, moving from the conventional to the full-safety model. That said, this shift is expected to take more than 18 months, required for manufacturing the needed machines and equipment, as well as register the products in Egypt.
Recommendation(s)
- Provide the necessary support to the single-use syringes factories, which total 16 and employ approximately 4,800 workers; grant them a three-year transitional period to complete the shift.
Industry-Specific Reforms
Food Industry and Agriculture Products
21 Challenges(s)
Industry-Specific Reforms
Automotive Industry
5 Challenges(s)
Industry-Specific Reforms
Food Safety
3 Challenges(s)
Challenge(s)
- The lack of human resources within NFSA to effectively and efficiently carry out their functions and adopt new work mechanisms that are in line with international food safety control systems. Under the pretext of an increasingly bloated bureaucracy, competent authorities continue to deny the requests of the newly- established NFSA to recruit or contract with qualified individuals with diversified expertise to assist in meeting its mandate. Additionally, lack of awareness and appreciation of the important role to be played by NFSA is further aggravating the situation; competent authorities are requested NFSA to shrink its already-approved organizational structure, which is necessary for implementing the type of integrated activities and mission NFSA aims to achieve. So far, NFSA did not receive the necessary approvals from the Central Agency for Organization and Administration regarding the staffing table and job descriptions, at the same time, in an effort to undermine NFSA, agencies that were assigned the oversight functions prior to its establishment either refuse to second their employees to it, or prevent them from joining its ranks.
- All powers and prerogatives granted to NFSA under Law No. 1 of 2017, are ignored; it is treated like any other public agency with regards to public expenditure rationalization. Thus, NFSA is not able to secure the needed resources, such as vehicles, for its staff to carry out food safety inspections of food establishments. More generally, the lack of an adequate budget is impeding NFSA for fulfilling its expansive and important mandate, entails ensuring the food safety for millions of Egyptians, including vulnerable groups such as children, the elderly, the sick, and others; the work of NAFS also safeguards investments in two major revenue-generating sectors: the food processing sector, one of the leading sectors in terms of exports, as well as the tourism sector by ensuring the provision of safe and hygienic food in tourist facilities, being one of the most critical success factors in tourism.
Recommendation(s)
- Allocate sufficient resources to NFSA to attract qualified professionals, and provide professional development training to its staff.
- Provide NAFS with a realistic budget allocation commensurate with its expansive responsibilities and functions to allow it to carry out its mandate in an effective manner (e.g., procure vehicles needed for carrying out actual food safety inspection nationwide).
Challenge(s)
- The lack of human resources within NFSA to effectively and efficiently carry out their functions and adopt new work mechanisms that are in line with international food safety control systems. Under the pretext of an increasingly bloated bureaucracy, competent authorities continue to deny the requests of the newly- established NFSA to recruit or contract with qualified individuals with diversified expertise to assist in meeting its mandate. Additionally, lack of awareness and appreciation of the important role to be played by NFSA is further aggravating the situation; competent authorities are requested NFSA to shrink its already-approved organizational structure, which is necessary for implementing the type of integrated activities and mission NFSA aims to achieve. So far, NFSA did not receive the necessary approvals from the Central Agency for Organization and Administration regarding the staffing table and job descriptions, at the same time, in an effort to undermine NFSA, agencies that were assigned the oversight functions prior to its establishment either refuse to second their employees to it, or prevent them from joining its ranks.
- All powers and prerogatives granted to NFSA under Law No. 1 of 2017, are ignored; it is treated like any other public agency with regards to public expenditure rationalization. Thus, NFSA is not able to secure the needed resources, such as vehicles, for its staff to carry out food safety inspections of food establishments. More generally, the lack of an adequate budget is impeding NFSA for fulfilling its expansive and important mandate, entails ensuring the food safety for millions of Egyptians, including vulnerable groups such as children, the elderly, the sick, and others; the work of NAFS also safeguards investments in two major revenue-generating sectors: the food processing sector, one of the leading sectors in terms of exports, as well as the tourism sector by ensuring the provision of safe and hygienic food in tourist facilities, being one of the most critical success factors in tourism.
Recommendation(s)
- Allocate sufficient resources to NFSA to attract qualified professionals, and provide professional development training to its staff.
- Provide NAFS with a realistic budget allocation commensurate with its expansive responsibilities and functions to allow it to carry out its mandate in an effective manner (e.g., procure vehicles needed for carrying out actual food safety inspection nationwide).
Challenge(s)
- The lack of human resources within NFSA to effectively and efficiently carry out their functions and adopt new work mechanisms that are in line with international food safety control systems. Under the pretext of an increasingly bloated bureaucracy, competent authorities continue to deny the requests of the newly- established NFSA to recruit or contract with qualified individuals with diversified expertise to assist in meeting its mandate. Additionally, lack of awareness and appreciation of the important role to be played by NFSA is further aggravating the situation; competent authorities are requested NFSA to shrink its already-approved organizational structure, which is necessary for implementing the type of integrated activities and mission NFSA aims to achieve. So far, NFSA did not receive the necessary approvals from the Central Agency for Organization and Administration regarding the staffing table and job descriptions, at the same time, in an effort to undermine NFSA, agencies that were assigned the oversight functions prior to its establishment either refuse to second their employees to it, or prevent them from joining its ranks.
- All powers and prerogatives granted to NFSA under Law No. 1 of 2017, are ignored; it is treated like any other public agency with regards to public expenditure rationalization. Thus, NFSA is not able to secure the needed resources, such as vehicles, for its staff to carry out food safety inspections of food establishments. More generally, the lack of an adequate budget is impeding NFSA for fulfilling its expansive and important mandate, entails ensuring the food safety for millions of Egyptians, including vulnerable groups such as children, the elderly, the sick, and others; the work of NAFS also safeguards investments in two major revenue-generating sectors: the food processing sector, one of the leading sectors in terms of exports, as well as the tourism sector by ensuring the provision of safe and hygienic food in tourist facilities, being one of the most critical success factors in tourism.
Recommendation(s)
- Allocate sufficient resources to NFSA to attract qualified professionals, and provide professional development training to its staff.
- Provide NAFS with a realistic budget allocation commensurate with its expansive responsibilities and functions to allow it to carry out its mandate in an effective manner (e.g., procure vehicles needed for carrying out actual food safety inspection nationwide).
Industry-Specific Reforms
Grain Industry
6 Challenges(s)
Challenge(s)
- The use of Flour No. 2 (whole wheat four).
Recommendation(s)
- Expand the adding and use of Flour No. 2 (whole wheat four) in mills as it is high in nutritional value (protein, vitamins, and other nutrients).
Challenge(s)
- The use of Flour No. 2 (whole wheat four).
Recommendation(s)
- Expand the adding and use of Flour No. 2 (whole wheat four) in mills as it is high in nutritional value (protein, vitamins, and other nutrients).
Challenge(s)
- The use of Flour No. 2 (whole wheat four).
Recommendation(s)
- Expand the adding and use of Flour No. 2 (whole wheat four) in mills as it is high in nutritional value (protein, vitamins, and other nutrients).
Challenge(s)
- The use of Flour No. 2 (whole wheat four).
Recommendation(s)
- Expand the adding and use of Flour No. 2 (whole wheat four) in mills as it is high in nutritional value (protein, vitamins, and other nutrients).
Challenge(s)
- The use of Flour No. 2 (whole wheat four).
Recommendation(s)
- Expand the adding and use of Flour No. 2 (whole wheat four) in mills as it is high in nutritional value (protein, vitamins, and other nutrients).
Challenge(s)
- The use of Flour No. 2 (whole wheat four).
Recommendation(s)
- Expand the adding and use of Flour No. 2 (whole wheat four) in mills as it is high in nutritional value (protein, vitamins, and other nutrients).
Industry-Specific Reforms
Leather Industry
3 Challenges(s)
Challenge(s)
- The problem of distressed and stalled factories; the Ministry of Trade and Industry should explore different options to support these factories so that they resume operations.
- The problem of smuggling raw leather outside the country by circumventing the ministerial decrees regulating leather exports.
Recommendation(s)
- Strengthen control measuresat customs points, free zones, and transit areas.
- Criminalize smuggling and categorize it as a crime against honor.
- Confiscate seized goods, and enforce Article 15 of Law No. 118 of 1975 (Import and Export Law).
- Halt exports of unfinished leather.
- Support promotion tours to boost the leather-based industries in international markets.
Challenge(s)
- The problem of distressed and stalled factories; the Ministry of Trade and Industry should explore different options to support these factories so that they resume operations.
- The problem of smuggling raw leather outside the country by circumventing the ministerial decrees regulating leather exports.
Recommendation(s)
- Strengthen control measuresat customs points, free zones, and transit areas.
- Criminalize smuggling and categorize it as a crime against honor.
- Confiscate seized goods, and enforce Article 15 of Law No. 118 of 1975 (Import and Export Law).
- Halt exports of unfinished leather.
- Support promotion tours to boost the leather-based industries in international markets.
Challenge(s)
- The problem of distressed and stalled factories; the Ministry of Trade and Industry should explore different options to support these factories so that they resume operations.
- The problem of smuggling raw leather outside the country by circumventing the ministerial decrees regulating leather exports.
Recommendation(s)
- Strengthen control measuresat customs points, free zones, and transit areas.
- Criminalize smuggling and categorize it as a crime against honor.
- Confiscate seized goods, and enforce Article 15 of Law No. 118 of 1975 (Import and Export Law).
- Halt exports of unfinished leather.
- Support promotion tours to boost the leather-based industries in international markets.
Industry-Specific Reforms
Leather Tanning Industry
4 Challenges(s)
Challenge(s)
- Infrastructure works for the second phase has not yet started, thus it is not possible to relocate enterprises currently located in the area of Magra El Eyoun to El Roubiki Leather City.
- Irregular water supply in El Roubiki Leather City.
- Irregular sewer services in El Roubiki Leather City.
Recommendation(s)
- Expedite the completion of all infrastructure works and services in El Roubiki Leather City to help attract investors into the leather industry.
Challenge(s)
- Infrastructure works for the second phase has not yet started, thus it is not possible to relocate enterprises currently located in the area of Magra El Eyoun to El Roubiki Leather City.
- Irregular water supply in El Roubiki Leather City.
- Irregular sewer services in El Roubiki Leather City.
Recommendation(s)
- Expedite the completion of all infrastructure works and services in El Roubiki Leather City to help attract investors into the leather industry.
Challenge(s)
- Infrastructure works for the second phase has not yet started, thus it is not possible to relocate enterprises currently located in the area of Magra El Eyoun to El Roubiki Leather City.
- Irregular water supply in El Roubiki Leather City.
- Irregular sewer services in El Roubiki Leather City.
Recommendation(s)
- Expedite the completion of all infrastructure works and services in El Roubiki Leather City to help attract investors into the leather industry.
Challenge(s)
- Infrastructure works for the second phase has not yet started, thus it is not possible to relocate enterprises currently located in the area of Magra El Eyoun to El Roubiki Leather City.
- Irregular water supply in El Roubiki Leather City.
- Irregular sewer services in El Roubiki Leather City.
Recommendation(s)
- Expedite the completion of all infrastructure works and services in El Roubiki Leather City to help attract investors into the leather industry.
Industry-Specific Reforms
Mineral Industry
13 Challenges(s)
Industry-Specific Reforms
Ready-Made Garment Industry
2 Challenges(s)
Challenge(s)
- Manufacturers are facing increased financial burden from the additional fees imposed on them, as well as the COVID-19 pandemic.
Recommendation(s)
- Temporarily reduce fees associated with the following services:
- New logistic services in the customs department.
- Special roads toll rates on containers.
- Activate the Emergency Fund of the Ministry of Manpower and Migration, which is partially financed through monthly contributions by factories (1% of the basic wage of workers), to pay the salaries of workers in the event that it was decreed that industrial establishment should shut down.
- Exceptional Measure: Exempt all incoming shipments (that were already contracted for) from all the fees associated with customs clearance delays in Egyptian ports.
Challenge(s)
- Manufacturers are facing increased financial burden from the additional fees imposed on them, as well as the COVID-19 pandemic.
Recommendation(s)
- Temporarily reduce fees associated with the following services:
- New logistic services in the customs department.
- Special roads toll rates on containers.
- Activate the Emergency Fund of the Ministry of Manpower and Migration, which is partially financed through monthly contributions by factories (1% of the basic wage of workers), to pay the salaries of workers in the event that it was decreed that industrial establishment should shut down.
- Exceptional Measure: Exempt all incoming shipments (that were already contracted for) from all the fees associated with customs clearance delays in Egyptian ports.
Industry-Specific Reforms
Film Industry
1 Challenges(s)
Challenge(s)
- The complete shutdown of movie theaters during the COVID-19 crisis, as well as the numerous financial burdens placed on the industry (rent, salaries, maintenance costs, and taxes).
Industry-Specific Reforms
Nitrogen Fertilizer Industry
1 Challenges(s)
Challenge(s)
- Despite being one of the most important Egyptian industries, the nitrogen fertilizer industry faces challenges and problems due to the high price of energy. The industry is one of the most important Egyptian industries; the industry’s total investments reached approximately LE 200 billion, and it directly employees 50,000 workers.
- It is worth noting that natural gas is a main input in the manufacturing of nitrogen fertilizers; the cost of natural gas represents approximately 75-80% of the variable input costs for producing nitrogen fertilizers.
- Between 2014 to 2020, the price of supplying natural gas to nitrogen fertilizer factories have been fixed.
Recommendation(s)
- Lower the price of natural gas supplied to nitrogen fertilizer factories to $3/million British thermal unit.
- Adopt a product-linked natural gas pricing formula, such as the one applied to several urea-producing Egyptian companies—the price of natural gas is linked to the selling price of urea.
Industry-Specific Reforms
Ceramics Industry
3 Challenges(s)
Challenge(s)
- The price of natural gas in Egypt is much higher than global prices; while the global price is $2.5 per million British thermal unit, it reaches $4.5 per million British thermal unit in Egypt.
- This has diminished the productive capacity of Egyptian industries, and resulted in a loss in the country’s foreign exchange revenues due to lower exports.
- Increase in ceramics imports.
Recommendation(s)
- Adjust the price of natural gas for labor-intensive, mass-production factories, such that it matches the global price; this should increase the competitiveness of the Egyptian product.
Challenge(s)
- The price of natural gas in Egypt is much higher than global prices; while the global price is $2.5 per million British thermal unit, it reaches $4.5 per million British thermal unit in Egypt.
- This has diminished the productive capacity of Egyptian industries, and resulted in a loss in the country’s foreign exchange revenues due to lower exports.
- Increase in ceramics imports.
Recommendation(s)
- Adjust the price of natural gas for labor-intensive, mass-production factories, such that it matches the global price; this should increase the competitiveness of the Egyptian product.
Challenge(s)
- The price of natural gas in Egypt is much higher than global prices; while the global price is $2.5 per million British thermal unit, it reaches $4.5 per million British thermal unit in Egypt.
- This has diminished the productive capacity of Egyptian industries, and resulted in a loss in the country’s foreign exchange revenues due to lower exports.
- Increase in ceramics imports.
Recommendation(s)
- Adjust the price of natural gas for labor-intensive, mass-production factories, such that it matches the global price; this should increase the competitiveness of the Egyptian product.
Industry-Specific Reforms
Woodworking Industry
3 Challenges(s)
Challenge(s)
- Due to the COVID-19 crisis, workers in small workshops across governorates faced challenging wage issues; many of the small workshops employ a very large number of non-regular workers.
Challenge(s)
- Due to the COVID-19 crisis, workers in small workshops across governorates faced challenging wage issues; many of the small workshops employ a very large number of non-regular workers.
Challenge(s)
- Due to the COVID-19 crisis, workers in small workshops across governorates faced challenging wage issues; many of the small workshops employ a very large number of non-regular workers.
Industry-Specific Reforms
Textile Industries
9 Challenges(s)
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Challenge(s)
- Labor shortage and inadequacy of the industrial training offered in technical and vocational education and training institutions.
Recommendation(s)
- Link enrollment in industrial technical schools to the needs of industries.
- Make available training centers and specialized industrial technical schools in all industrial areas; ensure that the schools have appropriate departments that are aligned with the needs of the industries in the area, and the needs of the geographic area in general.
- The Micro, Small, and Medium-sized Enterprises Development Agency (MSMEDA) should expand the provision of training through its training centers.
- The Textile Industries Chamber and the training centers should collaborate and coordinate their efforts with regards to the design of the centers’ training policy and programs to ensure that factories have access to skilled labor.
- MSMEDA should coordinate with the Textile Industries Chamber to make available loans to support the textile industries; MSMEDA is the best fit for this vital role, especially after the amendment of its governing law.
Industry-Specific Reforms
Petroleum and Mining Industry
8 Challenges(s)
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Challenge(s)
- Facilitate the issuance of the security approvals that are required for obtaining exploration and extraction licenses; specify the required documents in advance, and set a time limit for when the entity must notify the applicant of its decision after all required documents have been submitted. The life of the approval/license should be extended to three years (it is currently one year), as long as the licensee did not commit any technical or security violation that would require otherwise. Delays in providing security clearances, even for state-owned enterprises, discourage foreign investment, which is critical for exploration activities that are high-risk investments, and thus, result in losing investment opportunities.
- The participation of military-owned companies and other state institutions in the competition for research and exploitation licenses (despite being of high risk and long term investments), without having adequate technical knowledge and expertise, creates a conflict of interest and even competition among them (e.g., Shalateen and IMEX). This practice raises the concerns of local investors, and by turn, international investors, which are mostly public companies.
Industry-Specific Reforms
Building Materials
4 Challenges(s)
Industry-Specific Reforms
Healthcare Providers
3 Challenges(s)
Industry-Specific Reforms
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Chemical Industries
1 Challenges(s)
Issue-Specific Reforms
20 Issue-specific Reforms
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
- Overlapping jurisdictions between the National Council for Payments and other government agencies.
Recommendation(s)
- Create an executive secretariat for the National Council for Payments, and task it with overseeing the implementation of its decisions and coordinating between the various competent government entities to prevent conflicts and overlapping powers.
Challenge(s)
Failure to fully enforce some of the provisions of Law No. 15 of 2017
- The New Urban Communities Authority, which is affiliated with the Ministry of Housing, Utilities, and Urban Communities, continues to require investors to provide a bank guarantee to acquire land in industrial zones; this is an exaggerated requirement as it was revoked under Law No. 15 of 2017.
Recommendation(s)
- Fully enforce the provisions of Law No. 15 of 2017, which revoked the bank guarantee requirement, as a proof of the seriousness of purpose of investors who are interested in acquiring industrial land.
Challenge(s)
Failure to fully enforce some of the provisions of Law No. 15 of 2017
- The New Urban Communities Authority, which is affiliated with the Ministry of Housing, Utilities, and Urban Communities, continues to require investors to provide a bank guarantee to acquire land in industrial zones; this is an exaggerated requirement as it was revoked under Law No. 15 of 2017.
Recommendation(s)
- Fully enforce the provisions of Law No. 15 of 2017, which revoked the bank guarantee requirement, as a proof of the seriousness of purpose of investors who are interested in acquiring industrial land.
Challenge(s)
Failure to fully enforce some of the provisions of Law No. 15 of 2017
- The New Urban Communities Authority, which is affiliated with the Ministry of Housing, Utilities, and Urban Communities, continues to require investors to provide a bank guarantee to acquire land in industrial zones; this is an exaggerated requirement as it was revoked under Law No. 15 of 2017.
Recommendation(s)
- Fully enforce the provisions of Law No. 15 of 2017, which revoked the bank guarantee requirement, as a proof of the seriousness of purpose of investors who are interested in acquiring industrial land.
Challenge(s)
Failure to fully enforce some of the provisions of Law No. 15 of 2017
- The New Urban Communities Authority, which is affiliated with the Ministry of Housing, Utilities, and Urban Communities, continues to require investors to provide a bank guarantee to acquire land in industrial zones; this is an exaggerated requirement as it was revoked under Law No. 15 of 2017.
Recommendation(s)
- Fully enforce the provisions of Law No. 15 of 2017, which revoked the bank guarantee requirement, as a proof of the seriousness of purpose of investors who are interested in acquiring industrial land.
Challenge(s)
Failure to fully enforce some of the provisions of Law No. 15 of 2017
- The New Urban Communities Authority, which is affiliated with the Ministry of Housing, Utilities, and Urban Communities, continues to require investors to provide a bank guarantee to acquire land in industrial zones; this is an exaggerated requirement as it was revoked under Law No. 15 of 2017.
Recommendation(s)
- Fully enforce the provisions of Law No. 15 of 2017, which revoked the bank guarantee requirement, as a proof of the seriousness of purpose of investors who are interested in acquiring industrial land.
Challenge(s)
Issues regarding the regulations of the Industrial Development Authority:
- The procedures by which the ownership is transferred to the manufacturer after the full payment agreed upon. The factories still suffer from the fact that they cannot have an ownership document from the IDA.
- There is no clarification in the clauses that highlights how a board of directors is to be selected.
- Clause no.31 specified paying a 25% installment in case of land allocation and a period of four years for payment.
- Clause No.38 specified the basis of comparison through using a points system in case the industrial investors requests are overloading. This is managed through the necessary estates to establish an industrial activity and in case the comparison of points between the applicants is insufficient then they may be selected based on the highest price offered by any of them.
- Clause no.44 has specified the rules for the purpose for which the property was disposed of. It stipulated that it is not permissible to change the activity except after the approval of the IDA and all concerned authorities. It also requested that the investor shall pay at least 50% of the difference between the value of the obtained property and the market value on the date of submitting the application.
- Clause No.34 has allowed the land-owning authorities to participate in the industrial projects in real states as an in-kind share within the capital of the project’s company in accordance with the conditions and regulations specified by the same article.
Recommendation(s)
- This must be clarified to preserve the rights of the manufacturer with the IDA.
- Representation to take place in the board of directors from the private industrial sector through the FEI with two or three representatives that aligns with other laws that were issued concerning the specialties of the IDA so that the FEI has an opinion in all committees that shall be formed.
- The payment period should be 15 years and the price should include the cost of utilities (electricity, gas, and water) so that it is paid in installments on the price of the land, including the interests of the installments.
- To amend the requirements of the registration and transfer the ownership upon achieving a building rate of 20% of the licensed buildings instead of the established 40% to enable the investor in obtaining the credit in return of the land after transferring its ownership and registration.
- To abolish the principle of bidding on the prices of the industrial lands while ensuring the right of a factory owner in obtaining a piece of a neighboring piece of land by the pre-emption system.
- The role of the government and its affiliated entities should be limited to being a regulator, facilitator, and monitor the process instead of being an investor; especially in the light of the structural reforms conducted by the state and list some of the state-owned enterprises (SOE) in the stock market for exiting its activities.
Challenge(s)
Issues regarding the regulations of the Industrial Development Authority:
- The procedures by which the ownership is transferred to the manufacturer after the full payment agreed upon. The factories still suffer from the fact that they cannot have an ownership document from the IDA.
- There is no clarification in the clauses that highlights how a board of directors is to be selected.
- Clause no.31 specified paying a 25% installment in case of land allocation and a period of four years for payment.
- Clause No.38 specified the basis of comparison through using a points system in case the industrial investors requests are overloading. This is managed through the necessary estates to establish an industrial activity and in case the comparison of points between the applicants is insufficient then they may be selected based on the highest price offered by any of them.
- Clause no.44 has specified the rules for the purpose for which the property was disposed of. It stipulated that it is not permissible to change the activity except after the approval of the IDA and all concerned authorities. It also requested that the investor shall pay at least 50% of the difference between the value of the obtained property and the market value on the date of submitting the application.
- Clause No.34 has allowed the land-owning authorities to participate in the industrial projects in real states as an in-kind share within the capital of the project’s company in accordance with the conditions and regulations specified by the same article.
Recommendation(s)
- This must be clarified to preserve the rights of the manufacturer with the IDA.
- Representation to take place in the board of directors from the private industrial sector through the FEI with two or three representatives that aligns with other laws that were issued concerning the specialties of the IDA so that the FEI has an opinion in all committees that shall be formed.
- The payment period should be 15 years and the price should include the cost of utilities (electricity, gas, and water) so that it is paid in installments on the price of the land, including the interests of the installments.
- To amend the requirements of the registration and transfer the ownership upon achieving a building rate of 20% of the licensed buildings instead of the established 40% to enable the investor in obtaining the credit in return of the land after transferring its ownership and registration.
- To abolish the principle of bidding on the prices of the industrial lands while ensuring the right of a factory owner in obtaining a piece of a neighboring piece of land by the pre-emption system.
- The role of the government and its affiliated entities should be limited to being a regulator, facilitator, and monitor the process instead of being an investor; especially in the light of the structural reforms conducted by the state and list some of the state-owned enterprises (SOE) in the stock market for exiting its activities.
Challenge(s)
Issues regarding the regulations of the Industrial Development Authority:
- The procedures by which the ownership is transferred to the manufacturer after the full payment agreed upon. The factories still suffer from the fact that they cannot have an ownership document from the IDA.
- There is no clarification in the clauses that highlights how a board of directors is to be selected.
- Clause no.31 specified paying a 25% installment in case of land allocation and a period of four years for payment.
- Clause No.38 specified the basis of comparison through using a points system in case the industrial investors requests are overloading. This is managed through the necessary estates to establish an industrial activity and in case the comparison of points between the applicants is insufficient then they may be selected based on the highest price offered by any of them.
- Clause no.44 has specified the rules for the purpose for which the property was disposed of. It stipulated that it is not permissible to change the activity except after the approval of the IDA and all concerned authorities. It also requested that the investor shall pay at least 50% of the difference between the value of the obtained property and the market value on the date of submitting the application.
- Clause No.34 has allowed the land-owning authorities to participate in the industrial projects in real states as an in-kind share within the capital of the project’s company in accordance with the conditions and regulations specified by the same article.
Recommendation(s)
- This must be clarified to preserve the rights of the manufacturer with the IDA.
- Representation to take place in the board of directors from the private industrial sector through the FEI with two or three representatives that aligns with other laws that were issued concerning the specialties of the IDA so that the FEI has an opinion in all committees that shall be formed.
- The payment period should be 15 years and the price should include the cost of utilities (electricity, gas, and water) so that it is paid in installments on the price of the land, including the interests of the installments.
- To amend the requirements of the registration and transfer the ownership upon achieving a building rate of 20% of the licensed buildings instead of the established 40% to enable the investor in obtaining the credit in return of the land after transferring its ownership and registration.
- To abolish the principle of bidding on the prices of the industrial lands while ensuring the right of a factory owner in obtaining a piece of a neighboring piece of land by the pre-emption system.
- The role of the government and its affiliated entities should be limited to being a regulator, facilitator, and monitor the process instead of being an investor; especially in the light of the structural reforms conducted by the state and list some of the state-owned enterprises (SOE) in the stock market for exiting its activities.
Challenge(s)
Issues regarding the regulations of the Industrial Development Authority:
- The procedures by which the ownership is transferred to the manufacturer after the full payment agreed upon. The factories still suffer from the fact that they cannot have an ownership document from the IDA.
- There is no clarification in the clauses that highlights how a board of directors is to be selected.
- Clause no.31 specified paying a 25% installment in case of land allocation and a period of four years for payment.
- Clause No.38 specified the basis of comparison through using a points system in case the industrial investors requests are overloading. This is managed through the necessary estates to establish an industrial activity and in case the comparison of points between the applicants is insufficient then they may be selected based on the highest price offered by any of them.
- Clause no.44 has specified the rules for the purpose for which the property was disposed of. It stipulated that it is not permissible to change the activity except after the approval of the IDA and all concerned authorities. It also requested that the investor shall pay at least 50% of the difference between the value of the obtained property and the market value on the date of submitting the application.
- Clause No.34 has allowed the land-owning authorities to participate in the industrial projects in real states as an in-kind share within the capital of the project’s company in accordance with the conditions and regulations specified by the same article.
Recommendation(s)
- This must be clarified to preserve the rights of the manufacturer with the IDA.
- Representation to take place in the board of directors from the private industrial sector through the FEI with two or three representatives that aligns with other laws that were issued concerning the specialties of the IDA so that the FEI has an opinion in all committees that shall be formed.
- The payment period should be 15 years and the price should include the cost of utilities (electricity, gas, and water) so that it is paid in installments on the price of the land, including the interests of the installments.
- To amend the requirements of the registration and transfer the ownership upon achieving a building rate of 20% of the licensed buildings instead of the established 40% to enable the investor in obtaining the credit in return of the land after transferring its ownership and registration.
- To abolish the principle of bidding on the prices of the industrial lands while ensuring the right of a factory owner in obtaining a piece of a neighboring piece of land by the pre-emption system.
- The role of the government and its affiliated entities should be limited to being a regulator, facilitator, and monitor the process instead of being an investor; especially in the light of the structural reforms conducted by the state and list some of the state-owned enterprises (SOE) in the stock market for exiting its activities.
Challenge(s)
Issues regarding the regulations of the Industrial Development Authority:
- The procedures by which the ownership is transferred to the manufacturer after the full payment agreed upon. The factories still suffer from the fact that they cannot have an ownership document from the IDA.
- There is no clarification in the clauses that highlights how a board of directors is to be selected.
- Clause no.31 specified paying a 25% installment in case of land allocation and a period of four years for payment.
- Clause No.38 specified the basis of comparison through using a points system in case the industrial investors requests are overloading. This is managed through the necessary estates to establish an industrial activity and in case the comparison of points between the applicants is insufficient then they may be selected based on the highest price offered by any of them.
- Clause no.44 has specified the rules for the purpose for which the property was disposed of. It stipulated that it is not permissible to change the activity except after the approval of the IDA and all concerned authorities. It also requested that the investor shall pay at least 50% of the difference between the value of the obtained property and the market value on the date of submitting the application.
- Clause No.34 has allowed the land-owning authorities to participate in the industrial projects in real states as an in-kind share within the capital of the project’s company in accordance with the conditions and regulations specified by the same article.
Recommendation(s)
- This must be clarified to preserve the rights of the manufacturer with the IDA.
- Representation to take place in the board of directors from the private industrial sector through the FEI with two or three representatives that aligns with other laws that were issued concerning the specialties of the IDA so that the FEI has an opinion in all committees that shall be formed.
- The payment period should be 15 years and the price should include the cost of utilities (electricity, gas, and water) so that it is paid in installments on the price of the land, including the interests of the installments.
- To amend the requirements of the registration and transfer the ownership upon achieving a building rate of 20% of the licensed buildings instead of the established 40% to enable the investor in obtaining the credit in return of the land after transferring its ownership and registration.
- To abolish the principle of bidding on the prices of the industrial lands while ensuring the right of a factory owner in obtaining a piece of a neighboring piece of land by the pre-emption system.
- The role of the government and its affiliated entities should be limited to being a regulator, facilitator, and monitor the process instead of being an investor; especially in the light of the structural reforms conducted by the state and list some of the state-owned enterprises (SOE) in the stock market for exiting its activities.
Challenge(s)
Issues regarding the regulations of the Industrial Development Authority:
- The procedures by which the ownership is transferred to the manufacturer after the full payment agreed upon. The factories still suffer from the fact that they cannot have an ownership document from the IDA.
- There is no clarification in the clauses that highlights how a board of directors is to be selected.
- Clause no.31 specified paying a 25% installment in case of land allocation and a period of four years for payment.
- Clause No.38 specified the basis of comparison through using a points system in case the industrial investors requests are overloading. This is managed through the necessary estates to establish an industrial activity and in case the comparison of points between the applicants is insufficient then they may be selected based on the highest price offered by any of them.
- Clause no.44 has specified the rules for the purpose for which the property was disposed of. It stipulated that it is not permissible to change the activity except after the approval of the IDA and all concerned authorities. It also requested that the investor shall pay at least 50% of the difference between the value of the obtained property and the market value on the date of submitting the application.
- Clause No.34 has allowed the land-owning authorities to participate in the industrial projects in real states as an in-kind share within the capital of the project’s company in accordance with the conditions and regulations specified by the same article.
Recommendation(s)
- This must be clarified to preserve the rights of the manufacturer with the IDA.
- Representation to take place in the board of directors from the private industrial sector through the FEI with two or three representatives that aligns with other laws that were issued concerning the specialties of the IDA so that the FEI has an opinion in all committees that shall be formed.
- The payment period should be 15 years and the price should include the cost of utilities (electricity, gas, and water) so that it is paid in installments on the price of the land, including the interests of the installments.
- To amend the requirements of the registration and transfer the ownership upon achieving a building rate of 20% of the licensed buildings instead of the established 40% to enable the investor in obtaining the credit in return of the land after transferring its ownership and registration.
- To abolish the principle of bidding on the prices of the industrial lands while ensuring the right of a factory owner in obtaining a piece of a neighboring piece of land by the pre-emption system.
- The role of the government and its affiliated entities should be limited to being a regulator, facilitator, and monitor the process instead of being an investor; especially in the light of the structural reforms conducted by the state and list some of the state-owned enterprises (SOE) in the stock market for exiting its activities.
Challenge(s)
Issues regarding the regulations of the Industrial Development Authority:
- The procedures by which the ownership is transferred to the manufacturer after the full payment agreed upon. The factories still suffer from the fact that they cannot have an ownership document from the IDA.
- There is no clarification in the clauses that highlights how a board of directors is to be selected.
- Clause no.31 specified paying a 25% installment in case of land allocation and a period of four years for payment.
- Clause No.38 specified the basis of comparison through using a points system in case the industrial investors requests are overloading. This is managed through the necessary estates to establish an industrial activity and in case the comparison of points between the applicants is insufficient then they may be selected based on the highest price offered by any of them.
- Clause no.44 has specified the rules for the purpose for which the property was disposed of. It stipulated that it is not permissible to change the activity except after the approval of the IDA and all concerned authorities. It also requested that the investor shall pay at least 50% of the difference between the value of the obtained property and the market value on the date of submitting the application.
- Clause No.34 has allowed the land-owning authorities to participate in the industrial projects in real states as an in-kind share within the capital of the project’s company in accordance with the conditions and regulations specified by the same article.
Recommendation(s)
- This must be clarified to preserve the rights of the manufacturer with the IDA.
- Representation to take place in the board of directors from the private industrial sector through the FEI with two or three representatives that aligns with other laws that were issued concerning the specialties of the IDA so that the FEI has an opinion in all committees that shall be formed.
- The payment period should be 15 years and the price should include the cost of utilities (electricity, gas, and water) so that it is paid in installments on the price of the land, including the interests of the installments.
- To amend the requirements of the registration and transfer the ownership upon achieving a building rate of 20% of the licensed buildings instead of the established 40% to enable the investor in obtaining the credit in return of the land after transferring its ownership and registration.
- To abolish the principle of bidding on the prices of the industrial lands while ensuring the right of a factory owner in obtaining a piece of a neighboring piece of land by the pre-emption system.
- The role of the government and its affiliated entities should be limited to being a regulator, facilitator, and monitor the process instead of being an investor; especially in the light of the structural reforms conducted by the state and list some of the state-owned enterprises (SOE) in the stock market for exiting its activities.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The existence of multiple tax files and taxpayer identification numbers for the same enterprise in different government entities.
Recommendation(s)
- Issue a single national taxpayer identification number for each enterprise to be used for reporting the different types of applicable taxes (income tax, VAT, customs duties, insurance, and others).
- Introduce a method of combined reporting for VAT and income tax—filing a single tax return that combines the VAT return and income tax return. This will facilitate offsetting claims and obligations by the Tax Authority.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The Egyptian Customs Authority has requested from some of the industrial and commercial multinational investing and operating enterprises in Egypt to pay the differences from the customs and other fees paid on raw materials and production inputs that are imported to manufacture its products in Egypt and the finished imported products in order to sell them in the local market on the basis that these payments and paid revenues is part of the value of customs equipment. Hence, the customs and other fees should be paid for it,, even though that the larger portion of the established contracts in that regard with the main company HQ which states that the payments and revenues that is paid to it are payments correlated to the production and utilization of the trademark about the sold products in Egypt and it has nothing to do with the raw materials or production equipment imported through the foreign enterprise in Egypt; there are no payments given to the main enterprise, thus, these payments are not included in the category of the value of customs’ products.
- The value base for customs products value for commercial enterprises included payments for finished products that are imported from trade agreement states which are exempt from customs and the requests included the payments for products manufactured in the enterprises’ factories in Egypt (not established in the free zones).
- Assuming that enterprises accept the application on the raw materials, the bases used by the Egyptian customs were flawed as they included local cost elements such as workers’ wages, and local raw materials
- These requests are issued to companies retroactively for a period of five years after the companies announce the results of their businesses, distribute the profits, and pay the taxes due for those years which causes companies to bear additional burdens that were not previously taken into account, and of all this, it leads to an increase in the cost of production in Egypt compared to other countries which affects the competitiveness of the Egyptian product. Taking into account the ease of the business climate in those countries, also, some of the foreign companies’ operation in Egypt were under administrative seizure and its bank balances got frozen, which led the companies to resort to the judiciary to lift the seizure which in turn reflected an undesirable image of the business climate in Egypt.
Recommendation(s)
- Not adding those amounts paid from royalties and licenses for the use of technological right included in the cost elements upon which the customs value for raw materials and imported production inputs are added/calculated to, according to the Egyptian Customs Law and its Executive regulation as well as the international Agreement on Value for Custom Products.
Challenge(s)
- The lack of flexibility needed for the timely implementation of new projects, as well as weak organizational capacity across the state apparatus.
Recommendation(s)
- Adopt the recommendation of the Administrative Control Authority regarding the need for new projects to employ different organizational and administrative systems, which are much more flexible and capable than those stipulated in the Economic Zones of a Special Nature Law No. 83 of 2002, and the Investment Law No. 8 of 1997.
Challenge(s)
- The lack of flexibility needed for the timely implementation of new projects, as well as weak organizational capacity across the state apparatus.
Recommendation(s)
- Adopt the recommendation of the Administrative Control Authority regarding the need for new projects to employ different organizational and administrative systems, which are much more flexible and capable than those stipulated in the Economic Zones of a Special Nature Law No. 83 of 2002, and the Investment Law No. 8 of 1997.
Challenge(s)
- The lack of flexibility needed for the timely implementation of new projects, as well as weak organizational capacity across the state apparatus.
Recommendation(s)
- Adopt the recommendation of the Administrative Control Authority regarding the need for new projects to employ different organizational and administrative systems, which are much more flexible and capable than those stipulated in the Economic Zones of a Special Nature Law No. 83 of 2002, and the Investment Law No. 8 of 1997.
Challenge(s)
- The lack of flexibility needed for the timely implementation of new projects, as well as weak organizational capacity across the state apparatus.
Recommendation(s)
- Adopt the recommendation of the Administrative Control Authority regarding the need for new projects to employ different organizational and administrative systems, which are much more flexible and capable than those stipulated in the Economic Zones of a Special Nature Law No. 83 of 2002, and the Investment Law No. 8 of 1997.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The current mechanisms for defining the real estate property and carrying out cadastral surveys are antiquated and fall within the responsibilities of the Egyptian Survey Authority, which is affiliated with the Ministry of Irrigation.
Recommendation(s)
- Adopt modern surveying techniques and utilize the services of security-cleared entities that provide geo-imaging.
Challenge(s)
- The procedures for extending utilities to industrial establishments are cumbersome, lengthy, and costly.
- Industrial areas lack in services such as transport, health facilities, shops, and restaurants.
- Pricing of different energy products for industrial establishments does not follow any uniform standard; pricing schemes vary according to the nature of the industrial sector.
- The high price of natural gas has a negative impact on industrial competitiveness (particularly for steel factories); the domestic gas price reached $7/million British thermal unit compared to $3/million British thermal unit in the global market.
Recommendation(s)
- Consider offering payment plans, including an installment scheme, to allow industrial enterprises to pay for utilities over time; the payment plan should be commensurate with the size of the enterprise.
- Provide reliable and economical transportation to serve workers in industrial zones.
- Make available commercial properties in industrial zones that can be used by food and beverage providers, as well as rest and recreation areas.
- Provide emergency medical facilities in industrial areas.
- Adopt a standardized mechanism for pricing energy products used in factories in order to achieve greater transparency and fairness. Similar to the situation in most industrial nations, the mechanism should be based on a well-defined formula that takes into consideration global prices, including their upward and downward fluctuations.
- Exercise flexibility when pricing natural gas, especially for factories with high natural gas consumption. Domestic prices should correspond to global prices, and at the same time safeguard the competitiveness of the local product.
Status/Notes / Updates
- On March 17, 2020, the Prime Minister issued a number of decrees that support the industrial sector. The decrees entailed reducing the price of natural gas for industries to $4.5 /million British thermal unit, as well as lowering electricity prices for ultra-high, high-and medium-voltage industrial activities by LE 0.10, and placing a freeze on electricity prices for the next 3-5 years for other industrial uses.
Challenge(s)
- The draft law does not establish a careful balance between workers' and employers' rights. It revives the concept of open-ended employment contracts, under which an employer has no choice but to resort to the courts to dismiss a worker who has committed a serious infraction.
Recommendation(s)
- Discard the concept of open-ended employment contracts and ensure that employers and employees comply with the terms and conditions of the employment agreement.
Challenge(s)
- The draft law does not establish a careful balance between workers' and employers' rights. It revives the concept of open-ended employment contracts, under which an employer has no choice but to resort to the courts to dismiss a worker who has committed a serious infraction.
Recommendation(s)
- Discard the concept of open-ended employment contracts and ensure that employers and employees comply with the terms and conditions of the employment agreement.
Challenge(s)
- The draft law does not establish a careful balance between workers' and employers' rights. It revives the concept of open-ended employment contracts, under which an employer has no choice but to resort to the courts to dismiss a worker who has committed a serious infraction.
Recommendation(s)
- Discard the concept of open-ended employment contracts and ensure that employers and employees comply with the terms and conditions of the employment agreement.
Challenge(s)
- The draft law does not establish a careful balance between workers' and employers' rights. It revives the concept of open-ended employment contracts, under which an employer has no choice but to resort to the courts to dismiss a worker who has committed a serious infraction.
Recommendation(s)
- Discard the concept of open-ended employment contracts and ensure that employers and employees comply with the terms and conditions of the employment agreement.
Challenge(s)
- The draft law does not establish a careful balance between workers' and employers' rights. It revives the concept of open-ended employment contracts, under which an employer has no choice but to resort to the courts to dismiss a worker who has committed a serious infraction.
Recommendation(s)
- Discard the concept of open-ended employment contracts and ensure that employers and employees comply with the terms and conditions of the employment agreement.
Challenge(s)
Rail Transportation:
- The inordinate amount of time consumed in sorting freight cars is problematic, it is the main cause of the low efficiency of rail freight transport operations. Freight cars remain for a prolonged period of time in classification yards, in addition, too much time is wasted during the process of loading.
- Trains, especially on the main lines and suburban lines serving Cairo and Alexandria, are not running with sufficient frequency.
- In general, freight trains operate at a lower speed than trucks; more so, several passenger trains (on main lines, as well as branch lines such as Banha-Port Said-Tanta-Damietta) are slow.
- Freight cars operate at a low load factor, and freight car cycle time— length of time consumed by a freight car from one loading to the next again— reaches 14 days on average.
- An inefficient container transport system and the absence of an integrated transport system or a door-to-door shipping system.
- The contracting procedures employed by the Egyptian National Railways Authority are cumbersome; a complicated system for the classification of goods, with each class subject to different tariffs, is used, thus, determining shipping costs is a very complex process.
- The percentage of operational freight cars is very low due to the lack of due consideration to periodic maintenance of locomotives and railcars, as well as the lack of financial resources needed for carrying out maintenance programs.
- The lack of reservation and ticket agents, and shortcomings of the existing computerized ticketing system, specifically that it only covers two routes: Cairo - Alexandria, and Cairo - the High Dam.
- The low efficiency of cargo loading and unloading results in higher handling costs, and increased damage of goods during the shipping, stowage, and unloading operations.
- The prolonged periods of storage during the journey usually leads to damage or theft of goods.
Recommendation(s)
- Expand Egyptian National Railways Authority’s scope of activities, and introduce new areas to improve profitability, e.g., investing the vast areas of land under its jurisdiction.
- Increase the number of refrigerated railroad freight cars, and those equipped to carry containers to shorten the storage period and protect perishable freight.
Challenge(s)
Rail Transportation:
- The inordinate amount of time consumed in sorting freight cars is problematic, it is the main cause of the low efficiency of rail freight transport operations. Freight cars remain for a prolonged period of time in classification yards, in addition, too much time is wasted during the process of loading.
- Trains, especially on the main lines and suburban lines serving Cairo and Alexandria, are not running with sufficient frequency.
- In general, freight trains operate at a lower speed than trucks; more so, several passenger trains (on main lines, as well as branch lines such as Banha-Port Said-Tanta-Damietta) are slow.
- Freight cars operate at a low load factor, and freight car cycle time— length of time consumed by a freight car from one loading to the next again— reaches 14 days on average.
- An inefficient container transport system and the absence of an integrated transport system or a door-to-door shipping system.
- The contracting procedures employed by the Egyptian National Railways Authority are cumbersome; a complicated system for the classification of goods, with each class subject to different tariffs, is used, thus, determining shipping costs is a very complex process.
- The percentage of operational freight cars is very low due to the lack of due consideration to periodic maintenance of locomotives and railcars, as well as the lack of financial resources needed for carrying out maintenance programs.
- The lack of reservation and ticket agents, and shortcomings of the existing computerized ticketing system, specifically that it only covers two routes: Cairo - Alexandria, and Cairo - the High Dam.
- The low efficiency of cargo loading and unloading results in higher handling costs, and increased damage of goods during the shipping, stowage, and unloading operations.
- The prolonged periods of storage during the journey usually leads to damage or theft of goods.
Recommendation(s)
- Expand Egyptian National Railways Authority’s scope of activities, and introduce new areas to improve profitability, e.g., investing the vast areas of land under its jurisdiction.
- Increase the number of refrigerated railroad freight cars, and those equipped to carry containers to shorten the storage period and protect perishable freight.
Challenge(s)
Rail Transportation:
- The inordinate amount of time consumed in sorting freight cars is problematic, it is the main cause of the low efficiency of rail freight transport operations. Freight cars remain for a prolonged period of time in classification yards, in addition, too much time is wasted during the process of loading.
- Trains, especially on the main lines and suburban lines serving Cairo and Alexandria, are not running with sufficient frequency.
- In general, freight trains operate at a lower speed than trucks; more so, several passenger trains (on main lines, as well as branch lines such as Banha-Port Said-Tanta-Damietta) are slow.
- Freight cars operate at a low load factor, and freight car cycle time— length of time consumed by a freight car from one loading to the next again— reaches 14 days on average.
- An inefficient container transport system and the absence of an integrated transport system or a door-to-door shipping system.
- The contracting procedures employed by the Egyptian National Railways Authority are cumbersome; a complicated system for the classification of goods, with each class subject to different tariffs, is used, thus, determining shipping costs is a very complex process.
- The percentage of operational freight cars is very low due to the lack of due consideration to periodic maintenance of locomotives and railcars, as well as the lack of financial resources needed for carrying out maintenance programs.
- The lack of reservation and ticket agents, and shortcomings of the existing computerized ticketing system, specifically that it only covers two routes: Cairo - Alexandria, and Cairo - the High Dam.
- The low efficiency of cargo loading and unloading results in higher handling costs, and increased damage of goods during the shipping, stowage, and unloading operations.
- The prolonged periods of storage during the journey usually leads to damage or theft of goods.
Recommendation(s)
- Expand Egyptian National Railways Authority’s scope of activities, and introduce new areas to improve profitability, e.g., investing the vast areas of land under its jurisdiction.
- Increase the number of refrigerated railroad freight cars, and those equipped to carry containers to shorten the storage period and protect perishable freight.
Challenge(s)
Rail Transportation:
- The inordinate amount of time consumed in sorting freight cars is problematic, it is the main cause of the low efficiency of rail freight transport operations. Freight cars remain for a prolonged period of time in classification yards, in addition, too much time is wasted during the process of loading.
- Trains, especially on the main lines and suburban lines serving Cairo and Alexandria, are not running with sufficient frequency.
- In general, freight trains operate at a lower speed than trucks; more so, several passenger trains (on main lines, as well as branch lines such as Banha-Port Said-Tanta-Damietta) are slow.
- Freight cars operate at a low load factor, and freight car cycle time— length of time consumed by a freight car from one loading to the next again— reaches 14 days on average.
- An inefficient container transport system and the absence of an integrated transport system or a door-to-door shipping system.
- The contracting procedures employed by the Egyptian National Railways Authority are cumbersome; a complicated system for the classification of goods, with each class subject to different tariffs, is used, thus, determining shipping costs is a very complex process.
- The percentage of operational freight cars is very low due to the lack of due consideration to periodic maintenance of locomotives and railcars, as well as the lack of financial resources needed for carrying out maintenance programs.
- The lack of reservation and ticket agents, and shortcomings of the existing computerized ticketing system, specifically that it only covers two routes: Cairo - Alexandria, and Cairo - the High Dam.
- The low efficiency of cargo loading and unloading results in higher handling costs, and increased damage of goods during the shipping, stowage, and unloading operations.
- The prolonged periods of storage during the journey usually leads to damage or theft of goods.
Recommendation(s)
- Expand Egyptian National Railways Authority’s scope of activities, and introduce new areas to improve profitability, e.g., investing the vast areas of land under its jurisdiction.
- Increase the number of refrigerated railroad freight cars, and those equipped to carry containers to shorten the storage period and protect perishable freight.
Challenge(s)
Rail Transportation:
- The inordinate amount of time consumed in sorting freight cars is problematic, it is the main cause of the low efficiency of rail freight transport operations. Freight cars remain for a prolonged period of time in classification yards, in addition, too much time is wasted during the process of loading.
- Trains, especially on the main lines and suburban lines serving Cairo and Alexandria, are not running with sufficient frequency.
- In general, freight trains operate at a lower speed than trucks; more so, several passenger trains (on main lines, as well as branch lines such as Banha-Port Said-Tanta-Damietta) are slow.
- Freight cars operate at a low load factor, and freight car cycle time— length of time consumed by a freight car from one loading to the next again— reaches 14 days on average.
- An inefficient container transport system and the absence of an integrated transport system or a door-to-door shipping system.
- The contracting procedures employed by the Egyptian National Railways Authority are cumbersome; a complicated system for the classification of goods, with each class subject to different tariffs, is used, thus, determining shipping costs is a very complex process.
- The percentage of operational freight cars is very low due to the lack of due consideration to periodic maintenance of locomotives and railcars, as well as the lack of financial resources needed for carrying out maintenance programs.
- The lack of reservation and ticket agents, and shortcomings of the existing computerized ticketing system, specifically that it only covers two routes: Cairo - Alexandria, and Cairo - the High Dam.
- The low efficiency of cargo loading and unloading results in higher handling costs, and increased damage of goods during the shipping, stowage, and unloading operations.
- The prolonged periods of storage during the journey usually leads to damage or theft of goods.
Recommendation(s)
- Expand Egyptian National Railways Authority’s scope of activities, and introduce new areas to improve profitability, e.g., investing the vast areas of land under its jurisdiction.
- Increase the number of refrigerated railroad freight cars, and those equipped to carry containers to shorten the storage period and protect perishable freight.
Challenge(s)
- While Ministerial Decree No. 43 of 2016, which amended the rules governing the registration qualified foreign manufacturers prior to exporting their products to Egypt, is aligned with international agreements and the World Trade Organization rules, yet, there are a number of issues with the implementation mechanisms of the decree. For example, Section 1 of Article 2 of the Decree mandates that factories interested in registering must provide, among other documentations, “….. A certificate confirming that the manufacturer has a quality control system, issued by a body recognized by the International Laboratory Accreditation Cooperation (ILAC) or the International Accreditation Forum (IAF), or by an Egyptian or foreign governmental entity approved by the minister responsible for foreign trade.”
- Yet, to date, several companies that have been met the requirements set out in the decree remain unregistered, including a number of companies that adhere to high quality standards in their internal operations, and which enjoy a stellar international reputation.
Recommendation(s)
- Reconsider the implementation mechanisms of Ministerial Decree No. 43 of 2016, which was intended to serve as an interim measure prior to the decision to float the Egyptian pound).
- Ensure the correct application of the quality system-related provisions of the concerned Ministerial decree; providing a certificate from an approved accreditation body should suffice, there is no need to require the submission of the certification of quality.
- Allow companies, which fulfill the prescribed conditions and procedures of registration, to be directly registered by the General Authority of Export and Import Control, without the need for a ministerial decree to effect the registration.
- Publish the list of companies that meet the quality system requirements in the Egyptian Gazette.
- Consider developing a whitelist of international companies, across all sectors, which enjoy a strong reputation; allow these companies to be automatically registered.
Status/Notes / Updates
- In January 2019, Decree No. 44 of 2019 was issued expanding the list of goods included in Ministerial Decree No. 43 of 2016. The expanded list included bags/suitcases; items for packaging and transporting goods (e.g., containers, boxes, bags, and similar products); shaving and hair care appliances, and telephones.
Challenge(s)
- While Ministerial Decree No. 43 of 2016, which amended the rules governing the registration qualified foreign manufacturers prior to exporting their products to Egypt, is aligned with international agreements and the World Trade Organization rules, yet, there are a number of issues with the implementation mechanisms of the decree. For example, Section 1 of Article 2 of the Decree mandates that factories interested in registering must provide, among other documentations, “….. A certificate confirming that the manufacturer has a quality control system, issued by a body recognized by the International Laboratory Accreditation Cooperation (ILAC) or the International Accreditation Forum (IAF), or by an Egyptian or foreign governmental entity approved by the minister responsible for foreign trade.”
- Yet, to date, several companies that have been met the requirements set out in the decree remain unregistered, including a number of companies that adhere to high quality standards in their internal operations, and which enjoy a stellar international reputation.
Recommendation(s)
- Reconsider the implementation mechanisms of Ministerial Decree No. 43 of 2016, which was intended to serve as an interim measure prior to the decision to float the Egyptian pound).
- Ensure the correct application of the quality system-related provisions of the concerned Ministerial decree; providing a certificate from an approved accreditation body should suffice, there is no need to require the submission of the certification of quality.
- Allow companies, which fulfill the prescribed conditions and procedures of registration, to be directly registered by the General Authority of Export and Import Control, without the need for a ministerial decree to effect the registration.
- Publish the list of companies that meet the quality system requirements in the Egyptian Gazette.
- Consider developing a whitelist of international companies, across all sectors, which enjoy a strong reputation; allow these companies to be automatically registered.
Status/Notes / Updates
- In January 2019, Decree No. 44 of 2019 was issued expanding the list of goods included in Ministerial Decree No. 43 of 2016. The expanded list included bags/suitcases; items for packaging and transporting goods (e.g., containers, boxes, bags, and similar products); shaving and hair care appliances, and telephones.
Challenge(s)
- It was agreed with IDA’s former leaders to establish a comprehensive electronic system through which local product preference certifications would be issued to those interested in participating in government tendering processes; certification holders are to be accorded priority if their bids do not exceed the lowest foreign bid by more than 15%. Additionally, interested companies would also use the system to obtain the local component certificate required for receiving the export subsidy that the government offers as an incentive, based on meeting agreed upon terms and conditions. To date, this agreement has not been implemented.
Recommendation(s)
- IDA, FEI, and Fawry should enter into a tripartite agreement with the objective of completing the component of the system that would allow businesses to obtain the service immediately upon paying the associated cost, either through the website or through the collection points located across Egypt; this way, each party gets to fulfill its end of the agreement once the payment is made. This is also in line with the Ministry of Finance's directives regarding the adoption of electronic payment procedures to facilitate the provision of services and encourage the private sector to move towards a cashless society.
- Ensure that the database uploaded on the site is backed up on the FEI’s servers to ensure data preservation; regularly update the system and adopt robust data security measures.
Status/Notes / Updates
- IDA has completed its share of work, including setting the procedures regarding the electronic system and contracting with the entity that will be hosting the server (due to technical issues, it was not possible to use IDA’s existing system). When fully implemented, electronic payments will be made through the nation-wide collection points used by e-finance (an Egyptian Fintech company); businesses to obtain the service immediately upon paying the associated cost, either through the website or through the collection points located across Egypt; this way, each party gets to fulfill its end of the agreement once the payment is made. This is also in line with the Ministry of Finance's directives regarding the adoption of electronic payment procedures to facilitate the provision of services and encourage the private sector to move towards a cashless society.
Challenge(s)
- It was agreed with IDA’s former leaders to establish a comprehensive electronic system through which local product preference certifications would be issued to those interested in participating in government tendering processes; certification holders are to be accorded priority if their bids do not exceed the lowest foreign bid by more than 15%. Additionally, interested companies would also use the system to obtain the local component certificate required for receiving the export subsidy that the government offers as an incentive, based on meeting agreed upon terms and conditions. To date, this agreement has not been implemented.
Recommendation(s)
- IDA, FEI, and Fawry should enter into a tripartite agreement with the objective of completing the component of the system that would allow businesses to obtain the service immediately upon paying the associated cost, either through the website or through the collection points located across Egypt; this way, each party gets to fulfill its end of the agreement once the payment is made. This is also in line with the Ministry of Finance's directives regarding the adoption of electronic payment procedures to facilitate the provision of services and encourage the private sector to move towards a cashless society.
- Ensure that the database uploaded on the site is backed up on the FEI’s servers to ensure data preservation; regularly update the system and adopt robust data security measures.
Status/Notes / Updates
- IDA has completed its share of work, including setting the procedures regarding the electronic system and contracting with the entity that will be hosting the server (due to technical issues, it was not possible to use IDA’s existing system). When fully implemented, electronic payments will be made through the nation-wide collection points used by e-finance (an Egyptian Fintech company); businesses to obtain the service immediately upon paying the associated cost, either through the website or through the collection points located across Egypt; this way, each party gets to fulfill its end of the agreement once the payment is made. This is also in line with the Ministry of Finance's directives regarding the adoption of electronic payment procedures to facilitate the provision of services and encourage the private sector to move towards a cashless society.
Challenge(s)
- The continued support and incentives offered to industries result in financial obligations that exceed the current budget of the ESF; this practice affects its capacity to satisfy its obligations towards factories and business owners.
Recommendation(s)
- Set up a mechanism, whereby ESF’s debt owed to a business can be transformed into credit in favor of the business; the credit can then be used by the business to pay any dues or meet other delinquent obligations owed to the government.
Challenge(s)
- The continued support and incentives offered to industries result in financial obligations that exceed the current budget of the ESF; this practice affects its capacity to satisfy its obligations towards factories and business owners.
Recommendation(s)
- Set up a mechanism, whereby ESF’s debt owed to a business can be transformed into credit in favor of the business; the credit can then be used by the business to pay any dues or meet other delinquent obligations owed to the government.
Challenge(s)
- The continued support and incentives offered to industries result in financial obligations that exceed the current budget of the ESF; this practice affects its capacity to satisfy its obligations towards factories and business owners.
Recommendation(s)
- Set up a mechanism, whereby ESF’s debt owed to a business can be transformed into credit in favor of the business; the credit can then be used by the business to pay any dues or meet other delinquent obligations owed to the government.
Challenge(s)
- Role Modelling-Information Economy
Recommendation(s)
- The government should set an example by adopting technological solutions to better serve citizens and improve the efficiency of public services. In this regard, the government should partner with the private sector in the area of cybersecurity risks and raise awareness about the rights and responsibilities of internet users regarding use and security.
Challenge(s)
- Role Modelling-Information Economy
Recommendation(s)
- The government should set an example by adopting technological solutions to better serve citizens and improve the efficiency of public services. In this regard, the government should partner with the private sector in the area of cybersecurity risks and raise awareness about the rights and responsibilities of internet users regarding use and security.
Challenge(s)
- Role Modelling-Information Economy
Recommendation(s)
- The government should set an example by adopting technological solutions to better serve citizens and improve the efficiency of public services. In this regard, the government should partner with the private sector in the area of cybersecurity risks and raise awareness about the rights and responsibilities of internet users regarding use and security.
Challenge(s)
- Role Modelling-Information Economy
Recommendation(s)
- The government should set an example by adopting technological solutions to better serve citizens and improve the efficiency of public services. In this regard, the government should partner with the private sector in the area of cybersecurity risks and raise awareness about the rights and responsibilities of internet users regarding use and security.
Challenge(s)
- The contribution rates for old-age, disability, and death insurance that the employer and the insured employee should commit to (Clause 2 of Article 19)
Recommendation(s)
- Specify the contribution rates for old-age, disability, and death insurance that the employer and the insured employee should commit to (Clause 2 of Article 19). In the absence of specific contribution rates, conflicts between employers and insured employees are likely to arise.
- Set the contribution rates referenced in Clause 2 of Article 19 (pertaining to private sector employment) at 11% for the employer, and 10% for the employee.
Challenge(s)
- The contribution rates for old-age, disability, and death insurance that the employer and the insured employee should commit to (Clause 2 of Article 19)
Recommendation(s)
- Specify the contribution rates for old-age, disability, and death insurance that the employer and the insured employee should commit to (Clause 2 of Article 19). In the absence of specific contribution rates, conflicts between employers and insured employees are likely to arise.
- Set the contribution rates referenced in Clause 2 of Article 19 (pertaining to private sector employment) at 11% for the employer, and 10% for the employee.
Challenge(s)
- The resources of the special funds isare re-directed to support other budget deficits rather than being employed to serve the actual cause of its establishmentestablishment.
- There is no proper legal and regulative framework for special funds in Egypt
- Special funds do not comply with accountability requirements and transparent budget preparation process
- There is no governance framework that identifies responsibility and independence of the boards as well as accountability measures and transparency
- There is an accumulative financial responsibilitiesaccumulative financial responsibility on many special funds that altered its scope and direction and overlapped with government responsibilitiesresponsibilities.
Recommendation(s)
Policy Recommendations for Special Funds’ Policy Reforms:
- Creating policy and technical tools to avoid establishing new special funds away from the state budget to ensure the efficiency of the state budget structure.
- Amending the laws and regulations to ensure the ratification of financial bylaws as a requirement for the existence of any special funds. Additionally, the parliament should ensure any exceptional privilege for any special fund
- Modernization of the financial administration of special funds and listing specific KPIs to ensure accountable revenues and expenditure schemes with internal and external auditing process
- Ensuring transparency in all collected fees by special funds. The investor should know clearly in advance all the required money that he will pay.
- Ending all sorts of exceptions as no fund should be excluded from the state budget.
- Reforming the state budget to be more flexible so there is no demand for special funds
- The Ministry of Finance in cooperation with the General Authority for Organization and Administration should create comprehensive database with all workers and beneficiaries of all special funds in order to deal with any unfair grievances.
- Putting KPIs for employment in special funds and either to freeze hiring new personal or limiting salary amounts in the budget to 20-25%
Challenge(s)
- The minimum number of workers required for establishing a trade union committee at the level of the establishment, as well as the number of general unions required for establishing a federation is high.
- The draft law includes penalties involving the deprivation of liberty.
Recommendation(s)
- Lower the number of members required to form a trade union committee at the establishment level or an occupational committee from 150 members to 50.
- Lower the number of union committees required to form a general union from 15 committees with 20,000 member workers to 10 committees with 15,000 members.
- Lower the number of general unions required to form a federation from 10 unions with 200,000 members to 7 unions with 150 members.
Status/Notes / Updates
On August 5, 2019, the President ratified Law No. 142 of 2019, which amended a number of provisions of Law No. 213 of 2017.
The new law introduced a number of changes, including:
- Reducing the number of members required to form a trade union committee at the establishment level to 50 members.
- Reducing the number of union committees required to form a general union to 10 committees with 15,000 members.
- Reducing the number of general unions required to form a federation to 7 unions with 150,000 members.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
Challenge(s)
- Issuance of General Circular of the Ministry of Finance No. 24 of 2021 regarding the collection of revenues and the rights of the State Treasury, which included "the administrative authorities do not disburse the amounts of money due to suppliers and contractors until after submitting a statement from the Insurance Fund to pay the insurance dues and a certificate of the tax position (the last tax return for general taxes - and value-added tax).
- As a result of this circular, no financial extracts due to suppliers or contractors were disbursed until a receipt for payment of 5% social insurance was submitted.
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Special Private Funds
Trade Union Organizations Law
Government Contracts