The Federation of Egyptian Industries (FEI) has put in place urgent economic measures to protect Egyptian industry in the face of the coronavirus outbreak. The steps follow suit of other countries’ measures to support their own national industries.
The FEI will postpone tax filing for a period of three months, until 30 June. All companies nationwide will also be exempted, for a period of three months, from corporate tax, social insurance, and fixed installments of electricity and gas fines. The steps are to ensure factories have the required liquidity to fulfill their due obligations, including labour wages.
The FEI has also highlighted the compensation fund to support industries affected by the coronavirus and which had to close as a result. The fund provides 50% of workers’ wages not exceeding the minimum EGP 2,000, during the period of suspension, for a maximum of three months.
The federation has also pushed through the speedier disbursement of export subsidy arrears due to exporters from the fiscal year 2017 /18 until 30 June 2019. This is to pay company dues for national projects and companies’ entitlements with the Ministry of Finance, represented in value-added tax.
“[We are] accelerating [the] process of issuing permits and allocating lands for industrial entities to fast-track the addition of new investments in the national economy. In addition to this, we are taking all possible measures to take advantage of available and untapped production potentials to meet some urgent needs at the present time, for example, allowing cosmetic companies to obtain a share of alcohol in order to enable them to produce necessary disinfectants, whether in hospitals or facilities in general,” the FEI said.
The FEI has also outlined the procedures for increasing the percentage in inland exports in free zones to 50%, instead of the current 20%. Furthermore, the federation also considers replacing current export subsidy programme with direct cash assistance, especially as external exhibitions were significantly affected by the crisis.
Measures will be taken to ensure the restarting of all factories that have stopped production due to obstacles such as electricity contracting or other, the FEI noted.
It added,”[We are] considering mobile payment instead of cash that necessitates the movement of individuals between payment agencies and intermediary banking institutions, in light of the current preventive instructions set by the Egyptian state.”