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Wednesday, 2 November 2016

Supreme Investment Council adopts 17 pro-investment policies

Supreme Investment Council adopts 17 pro-investment policies: The Supreme Investment Council headed by President Abdel Fattah El Sisi adopted yesterday a basket of 17 measures designed to promote investment and job creation, Al Mal reports. Many of these have long been called for by business, while others were rumored to be part of the new Investment Law. No date was given for the implementation of the policies. They include:

  • Forming a “National Payments Council” that will work to restrict the handling of FX outside the banking sector;
  • The capital gains tax on stock market transactions will not come into effect for another three years;
  • Producers of agricultural crops that Egypt imports or exports will get tax exemptions;
  • Five-year tax exemptions for manufacturers of “strategic” goods that Egypt imports or exports;
  • Five-year tax exemptions for agriculture and industrial investments in Upper Egypt;
  • Setting a minor symbolic tax for SMEs to encourage them to file tax returns and be eligible for the CBE’s funding initiative;
  • The Egyptian Rural Development Company (which manages the 1.5 mn feddan project), the New Administrative Capital Company, the New Al Alamein development company and the companies managing the Siemens combined cycle power plants have been added to the roster state-owned companies that could go to IPO in the coming three years;
  • 25% discount on land in the New Capital, East Port Said and other new Urban Developments for three months;
  • The Industrial Development Authority (IDA) will issue temporary permits for unlicensed factories for one year, effectively giving them 12 months to obtain full permits;
  • Begin tendering land with utilities for industry in Upper Egypt for free as outlined by the IDA.

Other decisions included granting public-private partnership units in the government more leeway to operate; giving 35% discounts on settlements reached with the “committee to repossess illegally occupied land” (which we’re taking as meaning the Mahlab committee); and ensuring all ministries back government-brokered solutions on investment disputes.

Reuters has the story in English. The Supreme Investment Council is headed by El Sisi and includes the head of the General Intelligence Directorate, the ministers of finance, investment, trade, interior, justice and defense, as well as the governor of the central bank.

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