In any economic revamp, attracting foreign direct investment (FDI) is believed to be the magic wand for lifting growth rates and ensuring sustainable development. For more FDI inflows, there needs to be a central investment entity.
To boost business climates, President Abdel Fattah El Sisi has constituted the Supreme Council for Investment. Among its members are the prime minister, the governor of the central bank, as well as cabinet ministers and authorities concerned with the economy.
The new central entity is designed to convene at the invitation of its chairman at least once every three months or whenever it is necessary. It will play a key role in dispute settlement and iron out any obstacles facing investors.
How and why?
FDI is typically invested in new long-term projects. The issue is global, not regional, given unabated efforts from advanced and developing economies around the world to grab a bigger share.
Workforce quality, innovation, investment, development and a business-friendly environment are key factors in enhancing competitiveness in the global FDI race.
Where do we stand?
Egypt, as an emerging market, stands out as a splendid destination for FDI flows on the back of its location and economic potential. To begin with, the most populous Arab country enjoys a relatively large market as well as a stable foreign exchange rate.
Foreign exchange liberalisation opens the door to other measures to boost the investment climate in Egypt. Moreover, Egypt’s efficient banking system, which is capable of adapting to external shocks is another key requirement.
Net foreign direct investment (FDI) in Egypt jumped by 183 per cent to $4.1 billion in the first quarter (Q1) 2022, according to data from the Central Bank of Egypt (CBE). FDI inflows into Egypt jumped by 53.5 per cent to $7.3 billion between July 2021 and March 2022, according to data from the Cabinet Information Centre.
Needless to say, FDI inflows are an essential driver of sustained economic growth. Huge opportunities exist in a wide range of sectors in Egypt such as oil, energy, steel, furniture, petrochemical, food processing, cement, agricultural production and textiles for investment promotion.
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