Industry-Specific Reforms > Provision of Industrial Land

  • The lack of objectivity and transparency in the allocation and pricing of land, as well as the absence of comprehensive information on the availability of land, prices, and acquisition procedures.
  • Land policies are developed in the absence of an updated integrated land information system.
  • Lack of standardized procedures for land allocation across the various government entities, and lengthy and cumbersome allocation procedures.  

Industry-Specific Reforms > Provision of Industrial Land

  • The Prime Minister should promptly issue a decree to clarify jurisdictional issues related to industrial land; the decree should also clearly outline the role and function of the New Urban Communities Authority and IDA; the former should have jurisdiction over the land, infrastructure, and the provision of utilities, while the latter should have sole jurisdiction over land administration and allocation.
  • Resolve the legal conflict regarding the jurisdiction of IDA over industrial land, as stipulated in the law regulating IDA. If needed, issue a new law that clearly delineates the jurisdictional authority of different government entitles over industrial land and the responsibility for providing utilities and allocation of land to the final beneficiary.
  • Create a well-integrated and accessible information system for industrial lands; ensure that it remains updated.
  •  
  • Replace the numerous laws governing state land with a single unified and simplified law to administer it.  
  • IDA should be designated as the sole entity for interacting with investors. 
  • Create a land bank to serve as a database, listing all available industrial land, the price of each plot of land, and information regarding the current status of utilities and infrastructure.  

Industry-Specific Reforms > Provision of Industrial Land

  • A coordinating council, affiliated with the Cabinet, has been established to study the challenges facing investors in industrial zones. 
  • The Cabinet contracted a consultancy firm (MegaCom) to examine the challenges and barriers facing investors in industrial zones and develop solutions. The firm was to consult with investors and seek their feedback and views on the barriers and solutions. The consultancy contract is funded by the Ministry of Finance.
  • FEI and MegaCom discussed the recommendations included in the study. It was agreed that investors should be able to lease the land plot for ten years; the plot may be purchased if the investor demonstrates seriousness about the investment. 
  • Investors can acquire industrial land by accessing the investment map posted on the website of GAFI and, according to the type of projects to be established in each region. That said, many users find it difficult to deal with this online map.

Industry-Specific Reforms > Provision of Industrial Land

  • IDA lacks the financial resources needed for equipping industrial land with utilities. Together with the high cost of bringing utilities to undeveloped plots, small investors face a shortage of appropriate industrial land. IDA’s lack of financial resources is likely to hinder its ability to deliver on its plan of making available 60 million square meters of land by 2020.
  • Lack of industrial land plots (500 square meters) available to small enterprises in industrial zones, in line with the Industrial Licensing Law.
  • Excessive increases in land prices and the lack of pricing standards.

Industry-Specific Reforms > Provision of Industrial Land

  • Allocate additional land to IDA to increase the industrial land supply available for investors and develop objective and transparent mechanisms for land allocation.
  • Make available land plots and facilitate land acquisition procedures. 
  • Authorize the development of public markets, major commercial complexes, and hypermarket chains, which are critical for marketing locally manufactured products at competitive prices and increasing demand for these products.

Industry-Specific Reforms > Provision of Industrial Land

  • In June 2019, the Cabinet approved a proposal, submitted by the coordinating council for Industrial Zones that allows selling industrial land plots on installments at an annual interest rate of 7%, rather than the interest rate set by CBE.  This decision, which will remain in effect for three years only, aims to attract more investments to the industrial sector, in order to expand the establishment of new industrial zones to increase youth employment opportunities. 
  • In July 2019, the Internal Trade Development Authority) signed eight partnership agreements with a group of investors and commercial developers. Under these agreements, commercial and logistic zones will be established in a number of governorates including Sharqiya, Menoufia, Gharbia, Beheira, Luxor, Qena, Fayoum, and the New Obour City. It is expected that the agreements will attract investments worth LE 23 billion, and provide approximately 200,000 direct and indirect job opportunities, as well as make available commercial centers that meet all the needs of citizens at reduced prices.

Industry-Specific Reforms > Provision of Industrial Land

  • Land registration requires conducting cadastral surveys. However, the current capacity of the Egyptian Survey Authority does not allow it to respond to survey requests nation-wide in a timely manner, thus, expedited requests for registration are put on hold. 

Industry-Specific Reforms > Provision of Industrial Land

  • Authorize the establishment of accreditation offices to carry out cadastral surveys to facilitate the land registration process (similar to the case under the Simplification of Licensing Procedures for Industrial Enterprises Law and the Investment Law, which authorize the establishment of accreditation offices to facilitate the licensing process); allow security-cleared entities to use modern techniques of geographic photography.

Industry-Specific Reforms > Provision of Industrial Land

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.

Industry-Specific Reforms > Provision of Industrial Land

  • 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.

Industry-Specific Reforms > Provision of Industrial Land

Even though the Prime Minister’s decision number 3308 for year 2022 with regard to the immediate allotment of the industrial lands of the investors in applying the principle of usufruct, the decision included some important points that require modification:

  • The decision of the H.E Prime Minister no. 3308 for year 2022 with regard to the industrial land in most of the decreed rulings, especially concerning the rules and established prices, have been already issued from the Industrial Development Authority and the responsible commission with the decision no. 2100 for year 2021.
  • There was no discussion held with the Federation of Egyptian Industries (FEI) about the prices of the lands included in the decree which are overpriced and not attracting any investment/investors.
  • The decision did not include the required documents, even though the FEI had its reservations and objected several times about the documents required from the industrial investors after formulating committee 2100 for year 2021 such as providing detailed feasibility studies that include a technical,  economic, and fiscal studies. Also, infrastructure studies, capital investment, proposed fund, schedule of outdated products, production cost list, and a 5-year prospective income list starting from the project’s initiation date. Furthermore, referencing the procedures and pricing for the established committee according to the PM’s decision no. 2100 for year 2021, in contrast to what the decree no.95 for 2018 included.
  • The decision did not include the timeframe/period installments shall be paid through.
  • The decision included that the proposed prices are for guidance.
  • The decision did not elaborate on what the investors should do in case the piece of land was not delivered and this is a common situation that happened with most investors.
  • In the first clause, chapter no.5 ‘’In case the investor does not pay for two consecutive installments, the ownership entity has the right to terminate the contract’’.
  • In the first clause, chapter no.6 ‘’The land is given to, including what is established/built on it, to its protectorate after the usufruct period is over’’
  • In all cases, that who is assigned shall comply with all the assignments’ requirements, which include implementing the project and starting the initiation process in three-years’ time maximum starting from the date of receiving the land, in addition to complying with the specified scheduled period of time, otherwise, the piece of land is withdrawn/taken with usufruct during the time of having the piece of land. These are the rules that are applied presently which have many disadvantages such as:
    • The contracts that are formulated with the investor are compliance contracts meaning that s/he do not have the right to object to any clause and it also includes what was mentioned in the abovementioned chapter no.6 according to the PM’s decision.
    • The existence of natural obstacles, in the lands being delivered, is not taken into consideration. Such as the existence of a hill or other obstacles which shall take a period of time from the investor to remove, in addition to the increasing burden of the construction costs. Also, the delay fines are doubled on a monthly basis and also standard costs
    •  The attached lands are not delivered with the specified given piece of land whether at the starting date of land receival or during the implementation/execution of the process. The owning entity does not comply with the aforementioned and delay fines are applied on the investor in case a delay takes place for the scheduled period.
    • The Industrial Development Authority sets the execution program for a time limit of three years, without taking into account any obstacles or impediments that impede the process.
  •  What was mentioned in the last paragraph of Article 3 of the PM’s decision which states ‘’Paying the price of the land after reevaluating its commercial price while deducting what has been paid as usufruct’’
     

Industry-Specific Reforms > Provision of Industrial Land

  • The period of installment should be a 15-year period.
  • The prevailing notion about the lands issue is that industrial development and supporting manufacturers to reduce construction costs for factories to expand industrial production instead of land trading.
  • Simplify the documents that are required from the industrial investors after establishing the committee 2100 for year 2021 such as providing a detailed feasibility study.
  • The importance of clarifying other options for the investors in case the attached lands are not delivered.
  • The existence of grace periods in case of occurrence of out-of-control circumstances that affects the investor such as what took place in the case of COVID19 pandemic or the Russian-Ukrainian war or any critical occurrences that may affect the investor’s income and their ability to pay their debts steadily. Hence, a grace period must be included, and a first notice should be sent, and a second notice should be sent in a specified period of time that would allow them to utilize their resources to pay the belated debt especially since delay interest are applied according to the interest value issued in the bank.
  • To activate paragraph no.5, clause no.35, rule no.95 with regard to Industrial Development Authority and the noncompliance of the person of concern of the requested schedule; ‘’meaning that the investors must establish the executive time schedule themselves’’.
  • To validate the rights of the investor as the law did not specify the three-years established by the Industrial Development Authority without giving due consideration to the obstacles that might hinder the process during that time.
  • To specify a value that the investor gets by the end of the usufruct period in return to what have been established such as buildings or production lines in case the factory is not completely sold.
  • Changing the notion of the commercial price evaluation of the lands once owned, as the investor is the one that raised the commercial prices with the established investments since beginning the project. This has been objected by the FEI several times as the mindset of land trade still is dominated by the notion of selling the lands with the highest prices instead of maximizing production and industrial development.
  • In case of agreement on buying the land and owning it in a period of 5 years, the price of the land should be the same in the agreement as during usufruct period while deducting what has been paid during the latter period from the price value of the land.

Industry-Specific Reforms > Industrial Licensing Law

The limited capacity of IDA is reflected in a number of areas, including:

  • Inadequate staffing levels in IDA governorate-level offices render these offices ineffective.
  • Staff in the governorate-level offices do not have real authority to make decisions without consulting with headquarters in Cairo.
  • Some staff members are not well qualified; the majority do not have adequate understanding and knowledge of the procedures, and many lack the skills and abilities to engage effectively with the public.
  • IDA issued 16,000 licenses, however, it does not have the manpower to monitor and review these licenses. 
  • Poor communication and interaction between IDA and investors; the majority of investors are not aware of No. 15 of 2017.
  • IDA’s website requires further improvements and upgrading to serve as the prime platform for interaction with investors.

Industry-Specific Reforms > Industrial Licensing Law

So far, partial progress has been made in updating IDA’s website and populating it with much of the information needed by investors. However, online services are not yet operational, and no action has been taken to raise the capacity of IDA’s employees or increase its funding allocation. 

Industry-Specific Reforms > Industrial Licensing Law

  • Law No. 15 of 2017 is not fully implemented; contrary to Law No. 15 of 2017 that gave IDA a clear and comprehensive mandate over industrial activities, overlapping jurisdiction between IDA and other government entities persist.
  •  The multiplicity of oversight and inspection agencies, and the prevailing practice of imposing fines and shutting down enterprises by these agencies, including the Ministry Finance, the Ministry of Environment, the National Authority for Social Insurance, the Civil Defense Department, and local administration units.

Industry-Specific Reforms > Industrial Licensing Law

  • Ensure the effective implementation of Law No. 15 of 2017 and enable IDA to play its role effectively by preventing other entities from interposing into the industrial licensing process.
  • Simplify the “Real Property Proof of Possession” handbook, and codify it; Clause 1 under Article 2 of the Executive Regulations of Law No. 15 of 2017  stipulates that “When issuing industrial licenses, it is essential that completing all procedures and abiding by the set timeframes must be observed, such that businesses do no endure additional burdens”; the situation on the ground is in sharp contrast to what the Executive Regulations call for.
  • Before deciding to shut down any industrial enterprise, government entities must consult with IDA.
     

Industry-Specific Reforms > Industrial Licensing Law

  • Industrial licensing procedures are rendered complex and difficult to identify and decipher by the endless paperwork and cumbersome bureaucracy.

Industry-Specific Reforms > Industrial Licensing Law

Activate the government portal, which was created to facilitate the procedures for economic activities; the portal aims at simplifying all procedures related to licensing by:

  • Providing industrial investors with information regarding the required procedures.
  • Providing a central platform through which the competent administrative body and the industrial investors can interact and discuss issues.
  • Making available studies and analyses related to industrial development in Egypt.

Industry-Specific Reforms > Industrial Licensing Law

  • The license processing time continues to be long; banks refuse to finance industrial activities before the issuance of the operating license and the start of operations. 
  • The limited availability or lack of accreditation offices that are designed to speed up the licensing process.

Industry-Specific Reforms > Industrial Licensing Law

  • Set a target to meet the industrial licensing waiting time frames stipulated in the law by 2020: 7 days for licenses issued under the notification license system, and 3 months for licenses issued under the pre-licensing system.
  • Authorize governorate-level offices to grant licenses after completing the required procedures without having to secure the approval of the center.

Industry-Specific Reforms > Industrial Licensing Law

  • Even though 8 new accreditation offices were approved, however, licensing delays persist; more offices are needed to reduce the burden placed upon government entities. 

Industry-Specific Reforms > Industrial Licensing Law

  • The service fees imposed by IDA are excessive and eat up the capital of the investors.

Industry-Specific Reforms > Industrial Licensing Law

  • Reconsider the fees imposed by IDA to reduce the burden on investors

Industry-Specific Reforms > Industrial Licensing Law

  • IDA issued Decree No. 239 of 2019 reducing some of the prescribed service fees; most of the fees were lowered, particularly those related to SMEs. That said, it did not reduce the prescribed fines. 

Industry-Specific Reforms > Industrial Licensing Law

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.

Responsible Entities

Date 9/15/2021

Industry-Specific Reforms > Industrial Licensing Law

  • 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.

Responsible Entities

Date 9/15/2021

Industry-Specific Reforms > Utilities and Public Services

  • 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.

Industry-Specific Reforms > Utilities and Public Services

  • 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.

Industry-Specific Reforms > Utilities and Public Services

  • 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.

Industry-Specific Reforms > Import Control

  • IDA’s instructions regarding the registration of production inputs violate Article 15 of Ministerial Decree No. 835 of 2017, which amended some provisions of the Executive Regulations of the Import and Export Law, which were issued by Ministerial Decree No. 770 of  2005.

Industry-Specific Reforms > Import Control

  • Repeal IDA’s instructions; there is no different customs duty rates for the industry than for trade; only production inputs used in assembly industries are subject to different duty rates, in accordance with the rules regulating them.

Industry-Specific Reforms > Import Control

  • 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.

Industry-Specific Reforms > Import Control

  • 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.

Industry-Specific Reforms > Import Control

  • 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.  

Industry-Specific Reforms > Preference for Domestic Products

  • 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.

Responsible Entities

Date 6/30/2020

Industry-Specific Reforms > Preference for Domestic Products

  • 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.

Responsible Entities

Date 6/30/2020

Industry-Specific Reforms > Preference for Domestic Products

  • 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. 

Responsible Entities

Date 6/30/2020

Industry-Specific Reforms > Mineral Industry

  • Direct reduced iron (DRI) production plants (sponge iron) are not economically feasible due to the high price of natural gas ($7). In fact, DRI production plants should be treated like fertilizer and petrochemical plants, since natural gas is used as an input in the iron reduction process, and not as fuel. This gas pricing scheme has undeniable negative effects on the productive efficiency of the DRI production plants and impairs the equivalent of 6 million tons of sponge iron production capacity that can benefit the Egyptian economy. 

Industry-Specific Reforms > Mineral Industry

  • Similar to the case of the fertilizer industry, natural gas should be treated as a raw material, rather than a fuel, for (DRI) production plant—they should be charged $4.5/million British thermal unit. This measure will enhance their competitiveness and increase their production capacity from the current 7 million tons/year to 13 million tons/ year.
  • Impose a protectionist tariff on billet and steel rebar (customs items No. 7207, 7213, and 7214) imports from non-agreement countries.
  • Impose a protectionist tariff on imports of finished steel products taking into account that these tariffs do not adversely affect the domestic by raising the cost of inputs (e.g., billets).

Industry-Specific Reforms > Mineral Industry

  • In April 2019, the Ministry of Trade and Industry imposed a 25% and a 15% anti-dumping duty on imports of steel rebar and iron billets respectively.  
  • The advisory committee of the Ministry of Trade and Industry, which is responsible for developing the final report on the protectionist tariff imposed on imported billets, recommended revising the 15% anti-dumping duty on billets, and imposing instead a 7% duty during the first year, to gradually decrease to 5% during the second and 3% during the third.  

Industry-Specific Reforms > Mineral Industry

  • The fixed electricity charges (electric load charges) were supposed to represent less than 25% of the actual consumption. However, in the case of the metal casting industry (where the smelting is done within a day and the finishing within a week), as well as the factories which have to cease production for any reason, this fixed charge far exceeds the actual consumption cost.

Industry-Specific Reforms > Mineral Industry

  • Place a cap on the fixed electricity charges so that they do not exceed 25% of the actual consumption. This will benefit the metal casting industries, as well as factories which cease production for any reason and maintain a competitive environment.

Industry-Specific Reforms > Mineral Industry

  • New factories that have requested additional electrical power above 500 kilowatts are required to pay generation fees equivalent to LE 550/kilowatt for low voltage electricity, and up to LE 3000/ kilowatt for high voltage electricity. This is inconsistent with the manner older factories are treated, thus competition is tilted in favor of older factories. 

Industry-Specific Reforms > Mineral Industry

  • The issue was presented to the Ministry of Electricity and the Cabinet, however, it is still under review. Until the issue is resolved, the existing competitiveness imbalances between established factories and new ones will continue.

Industry-Specific Reforms > Mineral Industry

  • The practice of auctioning off heavy industry licenses works against the goal of expanding exports, which requires increasing production beyond the needs of the local market, and making good use of the industry’s comparative advantage (cost of fuel and gas is lower than in the countries that have to import). Needless to say, such a practice represents an additional burden on new factories, and unlevels the playing field for the competition between new factories and the already established ones.

Industry-Specific Reforms > Mineral Industry

  • While the mineral industry’s share in Egypt’s non-petroleum exports is more than 20%, yet the industry, small and big businesses, are denied any export support services, as well as the benefits of the duty drawback system. This is illustrative of the lack of clarity regarding the objectives of the export support program, and its meager benefits to the export industry (on the other hand, export support programs in other countries, such as China, Turkey and the United States, lends strength to their exports). 

Industry-Specific Reforms > Mineral Industry

  • Review the export support plan.

Industry-Specific Reforms > Mineral Industry

  • Although the designation of industrial land plots for each industry in industrial zones is made with the full knowledge of IDA, yet industries are required to pay exorbitant fees, millions of Egyptian pounds, fees, if they want to raise the height of the building (more than 15 meters). Additionally, they have to obtain a building permit from the Civil Aviation Authority, which requires a topographic survey (costs thousands of Egyptian pounds per factory). 

Industry-Specific Reforms > Mineral Industry

  • Review the approval and fee requirements set by the Civil Aviation Authority.

Industry-Specific Reforms > Ceramics Industry

  • Factories suffer from high utility debt (electricity and natural gas) because they are erroneously classified as energy-intensive industries. 

Industry-Specific Reforms > Ceramics Industry

  • Since IDA concluded that the ceramics industry is a labor-intensive, rather than and energy-intensive industry, all utility debt, including interest, should be canceled; the utility debt represents 30% of the industry’s total debt.

Industry-Specific Reforms > Textile Industries

  • The Industrial Control Authority has weak capacities to carry out its functions, including the calculation of the waste percentages for manufacturers.

Industry-Specific Reforms > Textile Industries

  • Develop and modernize the Industrial Control Authority and provide it with updated electronic systems that can assist with calculating the waste and damage percentages to ensure fairness and equity in treating exporters.