Streamlining Egypt’s investment landscape
Analysis by Ahmed Kamel
A new investment bill will be a step on a long road towards improving Egypt’s business climate. However, it cannot on its own guarantee sustainable injections of local and foreign investments in the long run.
Last week, the Sherif Ismail-led cabinet approved a new investment bill in its second draft, and submitted it to parliament for endorsement. The new bill will replace the current Law No. 17/2015, which was passed in March 2015 ahead of the Egypt Economic Development Conference but has borne no fruit in terms of greenfield investment.
The new bill comprises of 115 articles, which financial analyst Ahmed El-Oteify described as a worryingly massive number. “Only specialists will understand it. This is wrong, as investors won’t assimilate it,” he said.
However, legal experts have welcomed the newly drafted bill, but stated that it would need to put an end to red tape, which has taken its toll on the business climate in Egypt over the past 40 years.
For business facilitation
The government is tipped to fully apply a one-stop shop system to facilitate licensing and other official procedures. Consecutive governments since 2002 have failed in putting the one-stop shop system into force.
It is the mentality of officials that must change, said Eissa Fathy, deputy head of the Securities Chamber of Commerce.
“The new bill won’t do anything if the old-fashioned mindset remains the same,” he noted.
Analysts have called for a one-stop shop, where official delegates offer investors an “all-in-one service, including licensing, registration and property allocation procedures.”
Free entry and exit of capital and eradicating bureaucracy are needed to attract foreign and local investments through well-designed, transparent and clear-cut legislations for investment, repatriation of profits, bankruptcy and dispute settlement.