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It was an FDI-themed day in the House yesterday. Here’s the rundown:
#1- House approves amendments aimed at boosting FDI: The House of Representatives yesterday gave preliminary approval to amendments to the 2017 Investment Law that lawmakers hope will help attract more foreign direct investment. The amendments were approved by the House Economic Affairs Committee last Wednesday.
The details: The proposed amendments will allow projects predating the 2017 bill to benefit from incentives and expand the variety of projects eligible for a single approval, known as the “golden license.” They aim to attract investment to sectors including “oil processing, fertilizers, iron and steel, LNG transport, and energy-intensive industries,” said Mohamed Abdel Hamid, deputy chair of the House Economic Committee.
Some MPs are happier than others: “These investment reforms might have come late but this is much better than never coming at all,” said Wafd Party Rep. Ayman Mehasseb. Egyptian Social Democratic Party Rep. Maha Abdel Nasser was less positive: “This is another cut-and-paste amendment of the investment law and I wonder how we will be able to implement this bill while we have so far failed to translate the state ownership policy document into fact on the ground,” she said. “The new amendments will not have any positive impact as long as we have two exchange rates for the USD on the local market,” she added.
REFRESHER- The amendments are part of 22 measures put forward by the Supreme Investment Council in May aimed at improving the business environment for the private sector by increasing transparency and competition. The government is aiming to attract USD 40 bn in private investment by 2026 as it looks to increase the private sector’s economic footprint, and to increase exports to USD 100 bn a year by the middle of the decade. Improving the business climate is also a key condition of our stalled USD 3 bn loan program with the IMF.
What next? Yesterday’s vote was preliminary approval only. MPs will need to pass the bill in a final plenary vote today or tomorrow. If they don’t do so before going on break tomorrow, it will slip to the fall session.
#2- MPs gave final approval to two bills allowing for the USD 565 mn redevelopment of the East Port Said port. The first bill allows the Suez Canal Economic Zone to hand a 30-year contract to Sky Logistics and Reliance Logistics to design, construct, manage, operate and maintain a new multi-purpose terminal worth USD 65 mn at the port. The second bill paves the way for Maersk’s Suez Canal Container Terminal to start work on a USD 500 mn container terminal. Both bills got the greenlight from the House Economic Affairs Committee last week.
Export hub ambitions: “The two bills are part of the government’s efforts aimed at upgrading Egyptian ports and turning them into international logistical centers and supply chain hubs,” Mostaqbal Watan Rep. Kamaleddin El Shafie said.
