CAIRO: Egypt will allow new companies to register online starting next month, Assem Ragab, chairman of General Authority for Investment and Free Zones (GAFI), told a conference Tuesday.
Ragab and other senior officials from GAFI outlined the steps taken so far to facilitate and improve the investment climate in Egypt.
One main complaint from foreign investors about doing business in Egypt is the red-tape and mounds of paperwork involved in opening offices locally, a process which takes anywhere between two to six months.
“[We are] working on moving some of the paperwork that used to be completed at the Commercial Registration Authority to GAFI, said Hassan Fahmy Mohamed, head of the authority’s investment sector.
GAFI has also designed a database of financial statements from registered companies, which will be used to provide more comprehensive periodic reports on Egypt’s economy.
“The report will include information about seven sectors: industry, agriculture, finance, services, constructions, tourism and telecommunication, Ahmed Haseeb, GAFI’s first under secretary, said.
According to one such report, GAFI found that the “net profits [of select companies] rose to LE 47.7 billion in 2007 from LE 33.5 billion in 2006. However, return on investment declined to 12 percent in 2007, from 14.6 percent in 2006; return on equity declined to 16 percent, from 19 percent in 2006; and return on assets declined to 24 percent, from 31 percent in 2006.
The report also shows that while 42.8 percent of the projects established in 2007 were set up in Cairo while around 2 percent were set up in Upper Egypt.
GAFI hopes that the newly created database will generate more statistics like these, which will help provide potential investors with detailed and comparative information on the Egyptian market.
The conference was attended by investors, executives from investments association and lawyers.
Several concerns were raised during the conference. Mohamed W. El-Khalafawy, partner at Saleh, Barsoum & Abdel Aziz, said applications and forms should be available in several language besides Arabic, to avoid the hassle of translation.
Amr Abdel Rehim, senior attorney at law El-Oteifi and Afifi Law Office, suggested the establishment of a data room where lawyers could bring potential investors to access available information on the Egyptian market.
Ragab, who has headed GAFI for almost two years, said these concerns and recommendations will be taken into consideration.
“We are paying full attention not only to new investors, but also to investors who have been doing business in the Egyptian market for years, Ragab said.
GAFI will establish a specific unit for investors looking into small- and medium-sized enterprises.
Egypt’s rank in the Doing Business Report rose from 165 in 2006 to rank 114 in 2008.