{"id":615440,"date":"2024-02-18T00:00:00","date_gmt":"2024-02-18T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/inside_industry\/with-warmer-political-ties-turkey-could-give-egyptian-industry-a-shot-in-the-arm\/"},"modified":"2024-02-18T00:00:00","modified_gmt":"2024-02-18T00:00:00","slug":"with-warmer-political-ties-turkey-could-give-egyptian-industry-a-shot-in-the-arm","status":"publish","type":"inside_industry","link":"https:\/\/enterpriseam.com\/egypt\/inside_industry\/with-warmer-political-ties-turkey-could-give-egyptian-industry-a-shot-in-the-arm\/","title":{"rendered":"With warmer political ties, Turkey could give Egyptian industry a shot in the arm"},"content":{"rendered":"

What our rapprochement with Turkey means for Egyptian industry:<\/strong> Despite political relations being on the rocks for the past decade, Egypt and Turkey have largely maintained their trade relations, with trade between the two countries coming in at USD 6.6 bn last year, according to recent CAPMAS figures (pdf)<\/a>. Now, with Cairo and Ankara working to mend fences and turn a new page \u2014 including with Turkish President Recep Tayyip Erdogan visiting Egypt for the first time since 2012<\/a> \u2014 Egyptian industry is expected to see a new localization push, several sources Enterprise spoke with said. We\u2019re also expecting to see the two sides revive plans to set up a Turkish industrial zone in Egypt, according to our sources. <\/p>\n

A quick look at Egypt\u2019s trade with Turkey:<\/strong> Although Egypt and Turkey maintained a relatively strong trade balance last year, 2023\u2019s figures fell 15.7% y-o-y from 2022 trade figures, which came in at USD 7.8 bn, according to CAPMAS. Egypt exported some USD 3.8 bn worth of goods in 2023 and imported USD 2.8 bn worth of goods from Turkey during the year. Turkey\u2019s investments also declined in FY 2022-23, coming in at 167.2 mn, dipping 7.1% y-o-y. <\/p>\n

Where could we see more trade cooperation between the two countries?<\/strong> Plans to establish a Turkish industrial zone in Egypt would house industries including aluminum production, automotives, machinery and equipment, and advanced tech industries. Trade and Industry Minister Ahmed Samir met with Ibrahim Burkay, chairman of the board of directors of Bursa\u2019s Chamber of Commerce to discuss the plans last week. <\/p>\n

Big investments could be on the way:<\/strong> Erdogan\u2019s visit to Egypt last week is expected to pave the way for Turkish investments of at least USD 10 bn in important industries in Egypt, which we need to reduce our import bill and give the industrial sector a shot in the arm, according to head of the Internal Trade Committee of the Importers Division of the Federation of Chambers of Commerce Matta Bishay, who is also a member of the Egyptian-Turkish Business Association. These sectors include engineering and machinery, according to Bishay. Erdogan and President Abdel Fattah El Sisi had also said last week they plan to bump up the value of trade between the two countries to USD 15 bn. <\/p>\n

A core focus is investments that will help with our localization push:<\/strong> One investment that is currently under discussion is an EGP 400 mn project in Egypt with two major Turkish water equipment and water meter companies, Bishay told Enterprise. The project \u2014 which would see the Turkish side committing up to 50% of the capital \u2014 would be designed to localize the production of water meters and other related equipment in Egypt to reduce our reliance on their imports, according to Bishay. The project, which is currently undergoing feasibility studies, would be the first of its kind to transfer technology and knowledge to Egypt, Bishay said. <\/p>\n

Why now?<\/strong> In addition to warming political relations helping to pave the way for more trade and investments between Egypt and Turkey, Ankara sees an important window to export more to Africa through Egypt, Majd El Manzalawy, a member of the Egyptian-Turkish Business Council, told Enterprise. Egypt being part of the Comesa regional economic group and the African Continental Freetrade Agreement (Afcfta) is also a major benefit for Egypt, which is encouraging for Turkey to increase its exports to Egypt as a gateway to the rest of the continent, according to El Manzalawy. This geographical advantage, coupled with an investor-friendly environment \u2014 thanks to the government\u2019s golden license program and the wide availability of raw materials \u2014 also positions Egypt as an attractive investment destination for Egypt, House Economic Committee member Attia El Fayoumi told Enterprise. <\/p>\n

Your top industrial development stories for the week: <\/strong><\/p>\n