{"id":633819,"date":"2024-07-21T00:00:00","date_gmt":"2024-07-21T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/inside_industry\/what-does-the-new-government-have-in-plan-for-industry\/"},"modified":"2024-07-21T00:00:00","modified_gmt":"2024-07-21T00:00:00","slug":"what-does-the-new-government-have-in-plan-for-industry","status":"publish","type":"inside_industry","link":"https:\/\/enterpriseam.com\/egypt\/inside_industry\/what-does-the-new-government-have-in-plan-for-industry\/","title":{"rendered":"What does the new government have in plan for industry?"},"content":{"rendered":"

The newly-sworn-in cabinet has big plans for industry:<\/strong> More incentives for export-oriented industry, import substitution, regulatory reform and boosted competitiveness, as well as increased connectivity with trade hubs are just a few of the ambitious industry-focused goals laid out in a 276-page document outlining the new cabinet\u2019s three-year strategy.<\/p>\n

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EXPORT-ORIENTED INDUSTRY- <\/p>\n

Egypt as a hub for industry and trade:<\/strong> The new cabinet led by Prime Minister Moustafa Madbouly intends to double down on finalizing a new national strategy for industry and trade competitiveness, with an emphasis on positioning Egypt as a hub for sustainable industry and trade, the report says. The initiative targets an annual growth of 31.2% in industrial output by FY 26-27 and USD 103.4 bn in total exports in the period between 2024 and 2026, and to USD 130 bn by FY 26-27.<\/p>\n

And a whole lot of other good talk for manufacturing and other exports:<\/strong> Also on the drawing board are incentives packages to boost export industries, partnerships with industry leaders and investors to localize the production of inputs to industry in a bid to save on FX, as well as domestic production of automotives and microchips. The cabinet is also eyeing a new database for export-oriented companies with performance appraisals, an 8% yearly increase in electronics exports and USD 2 bn in pharma exports by FY 26-27, regulatory and customs reforms, and golden licenses for agricultural projects. <\/p>\n

Egypt\u2019s exports to Africa are getting a special focus:<\/strong> The cabinet is eyeing boosted cooperation with trade partners in Africa via the African Continental Freetrade Area (AfCFTA) \u2014 which seems to be taking off<\/a> \u2014 and the COMESA, the report says. African exports will also be supported by new trade missions, with added support for companies targeting exports to Africa also on the cards.<\/p>\n

Remember:<\/strong> Egypt\u2019s exports will be supported by boosted capacity at SCZONE ports, as well as new investments in logistics zones, logistics corridors, dry ports, railways, and other infrastructure. We ran a recap of the new cabinet\u2019s transport and logistics strategy here<\/a>. <\/p>\n

Efforts to close the import gap also got a mention:<\/strong> The cabinet plans to collaborate with industry to increase locally sourced inputs to manufacturing by tapping investments for some 152 projects, the report says. Output from these investments will contribute to reducing the import bill and curbing FX drain once they come online.<\/p>\n

This has been on our radar for some time:<\/strong> The Trade Ministry-led import substitution initiative first came to light last year<\/a>. The 152 projects mentioned include paper products, pharma, serums, pipes, automotive components, as well as iron and steel and are slated to have a USD 3 bn output and cover some 11% of Egypt\u2019s trade deficit<\/a>. <\/p>\n

The Madbouly-led cabinet intends to support these goals via a slew of supportive <\/strong>measures,<\/strong> including completing plans for industrial clusters, improvements to roads and transport infrastructure, support for public companies involved with developing industrial clusters, and integrations with supply chains. Also on the table are programs to update the database for industrial real estate, facilities for applications and zoning, digitized permits.<\/p>\n

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COMPETITIVENESS- <\/p>\n

Less red-tape and more ease of doing business: <\/strong>The government intends to continue implementing and monitoring reforms approved in the first meeting of the Supreme Council for Investment<\/a> while preparing the next meeting\u2019s agenda. At the same time, the cabinet aims to streamline permits by leveraging digitalization, while developing and deploying the single window to simplify procedures for investors. Also under consideration is better communication between the General Authority for Investment and Freezones (GAFI), other government bodies, and stakeholders, as well as more transparency and clearer guidelines for official permits.<\/p>\n

Other strategic industry goals highlighted in the report:<\/strong><\/p>\n