The Ministry of Industry recently announced a new package of relief measures for stalled industrial projects that have construction permits but have failed to meet the deadlines to build projects on the industrial land they have been allocated.
The measures will remain in effect until 30 April 2026.
The package, implemented by the ministry through the General Authority for Industrial Development, includes extensions of six months, one year, or 18 months for projects depending on the progress achieved on the ground.
The measures also prohibit the public authorities from transferring or leasing land in industrial zones and developer areas unless the investor concerned demonstrates his commitment and three years have passed since the commencement of operations with the full land price paid.
Additional regulatory provisions have been outlined to ensure project completion and protect industrial land. Among these, lease contracts cannot be accepted as proof of ownership unless the land has been operational for three years.
Exceptions include approved financial leasing contracts and leases or usufruct rights issued by authorised bodies, as well as the renewal of lease terms for facilities that have previously obtained operating permits.
Requests to change a project’s activity are not accepted until 12 months of actual operations have passed and the investor has demonstrated his commitment, with the exception of products within the same sub-category.
Mohamed Al-Bahi, an executive committee member of the Federation of Egyptian Industries, told Al-Ahram Weekly that given rising construction costs, project owners face challenges in covering the expenses required to complete their factories.
This was taken into account when extending deadlines, which are now determined according to the actual progress on the ground, Al-Bahi said.
He added that abandoning the policy of land confiscation or cancellation of allocations is a positive step that will propel industrial development forward. He noted that in the past, land could be seized or allocations cancelled even if the investor had partially constructed his facilities.
However, with a shift in state policy stressing that factories should not be closed, this approach has been changed.
“The same logic applies if we aim for horizontal expansion in industry. It is unreasonable to seize land, as the too rigorous enforcement of the law can deter both local and foreign investors,” he said.
The Ministry of Industry has also introduced facilities for projects that have exceeded deadlines but whose owners have not yet started building their factories or commenced operations.
It said that in case of investors subject to land withdrawals where the withdrawal was not executed or where the land remains vacant after the withdrawal and has not been reallocated to another investor, this land can be repurchased at the current price.
In such cases, the owner must pay fines to benefit from any completed designs and studies, or the land may be permanently withdrawn if the owner does not proceed with his re-engagement.
Al-Bahi said that this is a positive development in the relationship between the Ministry of Industry and investors in all sectors, sending a message that the state is moving steadily towards economic reform and supporting and encouraging both local and foreign investors.
Hussein Al-Boudi, head of the Mills Division at the Federation of Egyptian Industries Chamber of Grain Industries, said the prohibition on approving the transfer of land allocated for industrial projects was a sensible measure to prevent profiteering from this land.
He explained that some investors purchase land and leave it undeveloped to benefit from price increases. The ministry’s decision is meant to close this loophole, he noted.
Al-Boudi added that the fines may be high for struggling investors and suggested that they be reduced to make the system more manageable.
Amr Khedr, a member of the Printing Division at the Federation of Egyptian Industries, said that in principle all the recent decisions issued by the Ministry of Industry are acceptable.
However, he expressed reservations about prohibiting the approval of transfers or leases of industrial land in industrial zones and developer areas unless the investor demonstrates commitment three years after operations begin and the full land price has been paid.
He said he hoped “this could be applied by requiring only full payment of the land price, without the three-year waiting period.”
“If the original owner has paid the full price but encountered difficulties, they should have the right to sell the land without waiting,” Khedr said.
He pointed out that in the provision prohibiting changes in project activity within the first 12 months a loophole has emerged in that additional activities can be simply added to the industrial registry, circumventing the 12-month rule.
He noted the need for “more regulatory measures to address this issue”.
Khedr also called for meetings, essentially industrial and commercial dialogues, with representatives from the Federation of Chambers of Commerce and the Federation of Egyptian Industries before such decisions are issued.
He explained that the chambers of commerce include more than 60 divisions, while the Federation of Egyptian Industries comprises several industrial chambers, in addition to the business community.
The outcomes from these meetings could be compiled into a working paper submitted to decision-makers, helping to identify common ground and achieve better agreements to advance the local and national industrial sectors, he suggested.
The Ministry of Industry has previously announced that in order to benefit from the facilitation measures applicants must submit a request to the General Authority for Industrial Development accompanied by a real estate, executive, financial, and legal inquiry form from the relevant authority issued within the previous 40 days.
The authority is required to expedite the review of requests, with the extension period commencing immediately upon approval. If the applicant fails to demonstrate commitment within the specified period, the land can be withdrawn and legal measures enforced.
* A version of this article appears in print in the 4 December, 2025 edition of Al-Ahram Weekly
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