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Doing Business with EgyptThessaloniki, 16 October 2014

Egypt, Investment for Development

Indicators

• Monthly Inflation Rate 10.07 % at the end of August 2014

• Net International Reserves 16.87 (USD billion) at the end of

Sept 2014

• Net Foreign Direct Investments during the FY 2012/13

reached (3.8 billion USD) and (4.1 billion USD) the FY

2013/14:

• Unemployment Rate 13.4% during Jul-Sept. FY2013/14

• Total exports (FY2012/2013 ) 26.0 USD billion ,

and recorded 18.7 USD billion during the 9 months of the FY

2013/14

• Total imports (FY 2012/2013) 57.5 USD billion , and

recorded 43.9 USD during the 9 months of the FY 2013/14

1,80%

2,20% 2.1%

2010/11 2011/12 2012/13

GDP Growth Rates

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3

Foreign Direct Investment in Egypt

8,1

6,8

2,2

4 3.8 4,1

0

1

2

3

4

5

6

7

8

9

2009/2008 2010/2009 2011/2010 2012/2011 2013/2012 2014/2013

USD Billion

Source : CBE

From January 1970 till August 2014:

• Total Greek participation in the issued capital is USD 613.23 Million

• Total number of companies with Greek capital operating in Egypt is 140companies

Greek Investment in Egypt

Source : GAFI

Industry; 6%

Finance; 83%

Tourism; 5%Services; 4%

Others; 2%

4.3

79.3

22.3

36.2

7.2

45.6

26.534.1

0.4515 12 18

126 8 11

2

2006 2007 2008 2009 2010 2011 2012 2013 - أغسطس١٤

Issued Capital Number of Companies

Greek Investment Development in Egypt Greek Investment by Sector

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Sample of The largest international Companies working in Egypt

• The process of registering foreign company subsidiaries to only three days ofprocessing time.

• The time to open foreign representation offices; 3 days while simplifyingadministrative steps related to establishing a business.

• Enhancing import and export flexibility through import and export certificatesthat are available for 3-5 year periods.

• Paying subscription fees to chamber of industry and the federation of Egyptianindustries at the one stop shop

• Increasing GAFI’s processing centers.

• Lifting the security approval requirement for media companies. As well as liftinglicensing requirements for print publications.

• An initiative to provide resources for a credit risk guarantee program to helpdevelop SMEs and help them gain access to bank financing.

Support and Incentives for Investments

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• There are five investor protection schemes which GAFI is currently endorsing:

Investor protection

1. Investor Care Department: established within GAFI to support and guideinvestors to resolve any conflicts they might face with the differentgovernmental authorities.

2. Disputes Settlement Center: established in 2009 for the reconciliation anddisputes resolution between business partners.

3. The Investment Disputes Resolutions Committee: which GAFI hosts its thetechnical secretariat.

4. The “Contracts Committee” which GAFI is a member of, to resolve any conflictthat might arise between the investors and different governmental bodies overpreviously signed business contracts.

5. Modification of the Investment law No. (8) year 1997 to allow the reconciliationbetween the investor and the government in the cases of proven fraud.

Ambitious sectorial strategies

ICT: DIGITAL Egypt 2013

INDUSTRY: Textiles

• One of the highest-growth potential IT markets in the Middle East.

• has an annual sustained growth rate of 11.53% during q1 of the FY 2013/14

• contributes 2.7 % to real GDP.

• 30% of industrial output

• 14.2% of Non- Petroleum exports in first three quarters of 2011/2012

• 30% of local employment in 2010

• Egypt is home to the only fully vertically integrated textiles industry in the Middle East.

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à Egypt offers easy access to markets in the Arabian Gulf, the Levant, North Africa and Sub-Saharan Africa as well as Europe.

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• 20% of total power generation by 2020

• 12% of which will be generated by wind energy

• To boost US$110bn of investment into the power sector by 2027

• The leader producer: as Egypt produces almost 57% of the region’s total wind energy

Objectives:

• one of the oldest and most-established in the Middle East

• The nation’s banks, brokerages, investment banks and private equity houses are among the most vibrant in the region.

• Smart village the premiere technology park in the middle east.

FINANCE

RENEWABLE ENERGY

Ambitious sectorial strategies

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Ambitious sectorial strategies

• Unique geographic location combined with an expanding infrastructure bas

• 8% of the world’s maritime shipping passing through the Suez Canal.

• Accounting for 6.2% of GDP during q1 of the FY 2013/14.

• The government is planning investments of EGP 37.8 Bn. in the transportation sector during the FY 2013/14

• Accounting for 2.2% of total GDP during q1 of the FY 2013/14.

• Achieved growth rate of 10.2 during (Jul‐Mar) 2012/2013.

TOURISM

LOGISTICS

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• Egypt represents one of the largest markets in theregion, agriculture contributes to around 18.1% ofEgypt's GDP in q1 2013/2014.

• Food production industry in Egypt is better developedthan that in many neighboring states, creating strongexport opportunities.

• 6130 companies operating in the Agribusiness space inEgypt With total capital reaching EGP 50 billion andmanpower of 5 million

• Egypt has a long history as an exporter of well-educatedlabor.

• Egypt has a diverse base of educational system thatguarantees both a large pool of people who can teachand conduct training programs.

Education

AGRICULTURE

Ambitious sectorial strategies

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• Egypt is the largest market in the Arab world Witha population of 84mn.

• Booming retail sub-sectors include autos as salesforecast to increase by 126% between 2012 and2016, over-the-counter (OTC) pharmaceuticals,with sales expected to grow by 96.6% from by2016, and consumer electronics sales are forecastto increase by 50.8% in 2016.

• Wages in the wholesale and retail sector averageUS$ 32.20 weekly.

Real Estate

RETAIL

Ambitious sectorial strategies

• Total investments directed to the real estate sector inthe FY 2011/12 reached 17% of the totalimplemented investments.

• housing needs expected to climb to 8 million in 2022.

• 27 new urban cities are planned of which 5 underconstruction12

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Special Economic Zone in Egypt

§ The ZONE is strategically located on the main international ocean trade routes, promises to be a key benchmark in the evolution of Egypt. § 5% flat tax rate on personal

income tax and 10% tax on all activities within the zone§ Zero Import Duties.§ Zero Export duties when exporting

out of Egypt .§ Zero Export duties on domestic

components when sold in Egypt.§ Integrated custom and tax

administration, licensing, and dispute settlement

§ The ZONE is strategically located on the main international ocean trade routes, promises to be a key benchmark in the evolution of Egypt. § 5% flat tax rate on personal

income tax and 10% tax on all activities within the zone§ Zero Import Duties.§ Zero Export duties when exporting

out of Egypt .§ Zero Export duties on domestic

components when sold in Egypt.§ Integrated custom and tax

administration, licensing, and dispute settlement

Incentive benefits in SE ZoneIncentive benefits in SE Zone

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A business environment favourable to investment

• 5 main investor protection schemes endorsed by GAFI• 52 Double Tax Avoidance Agreements• 111 Investment Protection Agreements• Member of OECD Investment Committee• Member of MIGA (Multilateral Investment Guarantee Agency)

• 5 main investor protection schemes endorsed by GAFI• 52 Double Tax Avoidance Agreements• 111 Investment Protection Agreements• Member of OECD Investment Committee• Member of MIGA (Multilateral Investment Guarantee Agency)

• A stimulus package introduced by The Ministry of Industry to facilitate investments in the industrial sector

• Lifting the security approval requirement for media companies.• The issuance of the new financial tool “SUKUK”. • processing reforms related to the technical operations at GAFI`s one stop shop

• A stimulus package introduced by The Ministry of Industry to facilitate investments in the industrial sector

• Lifting the security approval requirement for media companies.• The issuance of the new financial tool “SUKUK”. • processing reforms related to the technical operations at GAFI`s one stop shop

Investor ProtectionInvestor

Protection

Legal ReformsLegal Reforms

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• incentives for taxpayers on the full or partial payment of their deferred income/sales taxes

• incentives for taxpayers on the full or partial payment of their deferred income/sales taxes

An Incentive Tax System

An Incentive Tax System

We are optimistic that Egypt's program`s objectives of promoting social justice, fostering recovery, and maintaining macro economic stability and generating jobs will bring positive results for the Egyptian people.

John Lipsky, Acting managing director of the IMF, June 2011

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Thank you for your attention

www.gafi.org.eg