File Photo: Tarek Amer (Photo: Ahram Arabic gate)
Foreign direct investment (FDI) to Egypt has declined to $1.9 billion in the second quarter of fiscal year 2017/2018, down from $2.4 billion in the same period last year at a rate of 20.8%, the Central Bank of Egypt said on Sunday.
According to state-run MENA news agency, the CBE released a monthly report that said overall inflows dropped to $3.4 billion in comparison to $3.9 billion during the corresponding period of FY 2016/2017.
Outflows also slipped to $1.561 billion during the second quarter of the current fiscal year, down from $1.566 billion during the corresponding period last fiscal year.
Egypt's fiscal year begins in July and ends in June.
The CBE also revealed the top countries investing in Egypt. European Union (EU) countries ranked first among them with a total of $1.96 billion.
Also among the top were UK investments worth $1.09 billion, followed by Belgian investments of $526.1 million, then French of $105 million, Luxembourgian of $58 million and Italian investments of $47.1 million.
Coming in sixth place, German investments hit $30.8 million, followed by Dutch investments of $24.8 million, Spanish investments of $11.2 million and finally Irish investments of $4.5 million.
According to the report, the total investments of Arab countries to Egypt during the second quarter of the current fiscal year reached $722.3 million.
The second-greatest Arab investor was Saudi Arabia with $87.1 million, followed by Kuwaiti investments of $21.9 million and Bahraini investments coming in last with $12.6 million.
Egypt has been implementing wide economic reforms in efforts to encourage private sector investments to drive the country's economic growth to create jobs and eliminate poverty.
The reforms include a number of fiscal measures taken since 2014, including fuel subsidy cuts, floatation of the Egyptian currency in November 2016 and the imposition of a new value added tax (VAT) to ease a growing budget deficit.
The country has since secured a $12 billion loan from the IMF.
In June 2017, President Abdel-Fattah El-Sisi ratified a long-awaited investment law which Egypt hopes will boost much-needed investment by cutting down on bureaucratic requirements, especially for new projects.
The new law includes a number of incentives, such as a 50 percent tax break on investments made in underdeveloped areas and government support for the cost of connecting utilities to new projects.
It also includes subsidised utilities, the allocation of lands free of charge for strategic activities, among other incentives.