CAIRO: The Egyptian cabinet passed a new law that would allow the construction of investment zones in accordance with the regulations applied to the construction of free zones.
Essentially, this entails simplifying the licensing process through the General Authority for Investment and Free Zones (GAFI).
The new law aims to facilitate the licensing process, making it faster and more transparent, said GAFI Chairman Ziad Ahmed Bahaa El Din at a July 30 press conference.
The new law states that investment zones will follow the same licensing procedures as free zones; however, investment zones will not be exempt from taxes.
Moreover, investment zones will no longer be limited to a single economic sector, but may include any investment activity such as industrial, touristic or agricultural. The new law also allows private sectors to establish, manage and promote these investment zones. This will relieve the burden of financing the zones from the government, who will continue to monitor the standards and regulations applied in these areas through an assigned board of directors.
According to Bahaa El Din, there are three main points to remember about investment zones: the zones do not have any tax privileges; they are not restricted to the industrial sector; and private companies can construct these zones following the same regulatory procedure as industrial zones.
Licenses for the investment zones cover two sections: the first is related to the particular zone while the second has to do with the sector in general, he added. GAFI will have already acquired the licenses pertaining to the general sector – such as licenses from the Supreme Council of Antiquities or the Egyptian Environmental Affairs Agency – so that the investor only has to acquire licenses that are specific to their project.
Bahaa El Din hopes that with the implementation of the new law, Egypt might also be able to go into the specialized investment zones, such as the already established Smart Village.
The old procedures will still be valid for a while to facilitate the transitional period from the old system to the new one, he added.
