File Photo: Egypt s upper consultative house. Al-Ahram
"Although the Senate approved amendments to the 2017 investment law this week, a large number of senators complained that the new incentives granted by the law are not enough to boost the flow of foreign investments into Egypt."
Hence the decision for "the Senate's Financial and Economic Affairs Committee to hold hearing sessions on a study prepared by Yasser Zaki, a member of Mostaqbal Watan and deputy chairman of the Senate's Financial and Economic Affairs Committee," said Abdel-Razek, adding that "the study will reflect the Senate's vision for a future strategy not only for foreign investments but for investments in Egypt in general."
Abdel-Razek said "the Senate's decision to prepare a new strategy for investment in Egypt is in line with the government's State Ownership Policy Document and the 23-25 October Economic Conference, with all aiming to lay out a roadmap that can lead to raising the competitiveness of the Egyptian economy through doubling foreign and local private investments."
Deputy Finance Minister Ahmed Kojak told the Senate that the State Ownership Policy Document will go into effect by the end of the year.
"The government finalised the document which will be ratified at the end of the year," said Kojak, adding that "the document, released by the government in May for the first time, aims to draw up a roadmap for a massive privatisation programme which should end up doubling the private sector's role in the economy to 65 per cent over the next five years and attracting $40 billion in investments by 2026."
Kojak revealed that "the finance ministry is preparing an annual progress report on tax and custom incentives. The report will be available to local and foreign businessmen who are interested in tapping investment opportunities in Egypt."
Kojak said the amendment to the 2017 investment bill, which was approved by the Senate on Monday, is also part of a package of measures aimed at generating greater foreign exchange revenues.
"The incentives mainly target advanced technological industries, which are the industries of the future."
Kojak added that the incentives "reflect the new policy of expanding on monetary incentives in line with international standards prescribed by the IMF and the World Bank," said Kojak.
He said the new investment bill shall give tax exemptions to investors who use foreign exchange to finance up to 55 per cent of the cost of their projects or expansions.
The amendment states that industrial investment companies which use foreign exchange to finance at least half of the cost of their projects would be granted a tax deduction ranging between 15 per cent and 55 per cent (instead of up to 55 per cent) on income generated by their projects.
The bill was rejected by the Egyptian Socialist Democratic Party. Its spokesman Mahmoud Sami said the unprecedented scope of incentives offered by the bill "is unjustified and will not help attract investments."
Many senators also complained that the bill is not enough to attract greater foreign investments and that there should be a new integrated strategy for eliminating obstacles standing in the way of local and foreign investors.
The new investment bill will still have to go to the House of Representatives to be finally discussed and passed. It also has to be ratified by President Abdel-Fattah El-Sisi.
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