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Tuesday, 11 February 2020

Egypt’s to settle export subsidy overdues with 15 companies soon- Kouchouk

The government will sign 15 agreements with exporters in the coming weeks to settle outstanding export subsidies, Vice Minister of Finance Ahmed Kouchouk told the press. According to Kouchouk, agreements with 77 companies have so far been signed to settle EGP 6.5 bn-worth of overdues in exchange for expansions and investments. Up to 115 other companies that are owed EGP 1 bn will also be receiving their arrears in the form of tax breaks.

Background: Exporters are owed bns of overdue subsidies under an old subsidies framework, payments for which have been moving forward since last September with the launch of a new EGP 6 bn framework. They received 10% of their arrears immediately at launch, and an additional 10% last month. They have the option of either writing off taxes or customs, investing in domestic manufacturing, and / or receiving industrial land at a discount to get the remainder.

The latest: We reported earlier this week that the government will settle overdue subsidies owed to 32 foreign and local companies over five years, provided the companies commit to new investments. Despite those ongoing settlements, companies are still finding it hard to claim their arrears due to bureaucratic hurdles, according to statements from Edita Chairman and Food Export Council head Hani Berzi and Chairman of the Export Council for Engineering Industries Amr Abu Farikha.

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