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Wednesday, 4 September 2019

Increased freezone fees threaten Egypt’s investment climate: MP

Increased freezone fees threaten Egypt’s investment climate, says Faragalla Group chairman: The General Authority for Investment’s (GAFI) decision to increase utilization fees for investors in freezones could have negative consequences on the investment climate in Egypt, warns Faragalla Group Chairman Farag Amer, according to Ahram Online. GAFI last week agreed to increase fees on freezone investments starting from January 2020. Amer, who is also the head of the House of Representatives’ Industrial Committee, said that hiking fees threatens to undo the government’s efforts to attract investors. “This is a very negative decision which will be a setback for Egypt’s investment climate,” he said. “The government should give greater incentives to investors rather than force them to pay greater fees.”

Background: GAFI decided on 27 August to raise utilization fees paid by investors for land in freezones from January 2020. Under the new rates, investors will pay USD 5 per sqm for land used for industrial projects, USD 9 / sqm for storage facilities, USD 18 / sqm for second hand auto trading businesses, and USD 28 for prefabricated buildings. Vacant land plots that have been recently developed or upgraded will be charged for the same activities USD 7 / sqm, USD 11 / sqm, USD 20 / sqm, and USD 30 / sqm, respectively. The Qaft City freezone is exempt from the fee increases.

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