Officials called for new legislation to reduce red tape for industrial projects during a session at the National Dialogue yesterday. Proposals for a ‘unified industrial law’ would merge the disparate legislation currently in effect and set up an authority tasked with eliminating bureaucratic hurdles and simplifying licensing rules for the sector.

There are too many laws that aren’t in alignment: The industry is currently governed by seven different laws, 15 legislative amendments and many presidential decrees, said the head of the House Industrial Committee, Moataz Mahmoud. ”Some of these are in conflict with each other and so now it is the right time to merge all of them into one unified industrial law that will help create an investor-friendly climate,” he said.

And too many governing bodies: “We have 17 ministries that deal with industrial activities in Egypt and all of these have to be merged into one system and regulated by one law,” Industrial Development Authority (IDA) chairman Mohamed Abdel Karim said.

GAFI x IDA: Mahmoud called for merging the General Authority for Freezones and Investment (GAFI) and the IDA into a single agency that would have sole regulatory authority for the industrial sector.

Boosting investment is a top priority amid the current crisis: Prime Minister Moustafa Madbouly last week unveiled 22 regulatory reformsaimed at making the country more attractive to foreign investors and increasing exports. The government is aiming to attract USD 40 bn in private investment by 2026 and increase exports to USD 100 bn a year by the middle of the decade by embarking on a series of structural reforms and reducing its involvement in the economy.

Industrial output is less than half of where it needs to be: There is a pressing need to raise the industrial sector’s contribution to the GDP to 40% from 16% currently, former finance minister and the dialogue’s economic rapporteur Ahmed Galal said. “The industrial sector in South Korea contributes 40% to GDP and we have to reach the same percent in Egypt in order to reduce imports and raise FX revenues … bureaucracy and conflicting laws are the only two reasons for the sector’s minimal contribution to Egypt’s GDP,” he said.

What’s next? Just like all of the recommendations brought up during the Dialogue, the proposal will be referred to its board of trustees to then be presented to President Abdel Fattah El Sisi.

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