(AFP Photo)
By Mostafa Fahmi, Ahmed Salama, Nahal Munir
The interim government is in the process of announcing a new incentives program to help attract new investment and stimulate the economy, according to Prime Minister Hazem El-Beblawi.
In a meeting held with members of the Board of Directors of the Federation of Egyptian Industries (FEI) and Chambers of Commerce, the prime minister said studies were currently being conducted to provide clear alternatives and solutions to the country’s energy problems.
State subsidies for exports would not last forever, El-Beblawi said, adding that such support would be a temporary means of encouraging new factories to increase their exports.
El-Beblawi added that challenges facing investors, which primarily included lapses in security, were being addressed and that huge improvements had so far been seen in the performance of security forces in recent months. These improvements would be made clear in the period following the end of the country’s state of emergency, he said, adding that the government has taken to easing the curfew whenever security improves.
The prime minister pointed to the need to put in place clear rules regarding the allotment and distribution of industrial land. Such land would need to be located near energy sources and be properly equipped to begin operations immediately.
Tariq Tawfiq, representative from the FEI, stated that the prime minister had expressed a clear desire to solve problems within the industrial sector, and give a positive impression that the state possessed a clear vision for economic reform, including incentives packages provided for investors. He added that the state sought to remove obstacles being faced by industrial investors, primarily energy related problems, the distribution of land, and security within industrial zones. The continuation of export subsidies would be contingent upon the state being able to put an end to obstacles and burdens faced by local investors, Tawfiq said, and its ability to implement economic reform. Export subsidies would be temporary, he said, however more time was needed before they could be removed entirely, due to the country’s current poor economic circumstances.
Mohamed Al-Bahi, member of the Board of Directors of the FEI stated that the prime minister had recently held an investor meeting, during which the he emphasised the need to improve security in industrial zones, a problem which has worsened considerably over the last three years.
Al-Bahi stated that factories would begin operating at full production capacity, with businessmen able to adhere to their export agreements, once security was improved within industrial zones. He emphasised the need to create new laws regulating the relationship between workers and employers, in order to cut back on sit-ins, strikes and the blocking off of roads leading into cities.
He emphasised the need to cooperate with the country’s banking sector in order to facilitate the opening up of additional lines of credit for investors, which would help increase local investment.
Hussein Mehana, member of the Board of Directors for the Federation of Egyptian Chambers of Commerce, recently discussed with the prime minister a number of problems which have impeded economic growth, including lapses in security, the distribution of commercial licenses and export subsidies.
The two also discussed issues having to do with the country’s various ministries, including delays witnessed in the Ministry of Supply’s distribution of subsidy funds to the country’s bakeries, which have negatively affected production rates of the former. Mohamed Abu Shadi, Minister of Supply and Internal Trade, was tasked during the meeting with addressing this issue, saying he would so as quickly as possible.
Meanwhile, Alaa Ezz, Secretary General of the FEI, stated that the Federation would present a detailed memorandum covering various demands made by the people to the prime minister. The prime minister would then in turn be responsible for reviewing the memorandum and delegating responsibility for addressing each issue to various ministers.
Translated from Al Borsa newspaper
