Egypt’s Minister of Finance Mohamed Maait has approved another tranche of export subsidies to be disbursed early next month, as part of the state programme to support exports.
The new funds will raise the amount of settled export subsidy arrears to 85%. The subsidies are provided from the Export Development Fund (EDF) and are in line with previous presidential mandates to ensure exporters have enough liquidity, especially during the novel coronavirus (COVID-19) crisis.
The decision was announced by Mohamed Khamis Shaaban, Secretary-General of the Egyptian Federation of Investors Associations (EFIA), following his meeting with Maait last Wednesday.
The meeting, which Shaaban described as very fruitful, included discussions of immediate and encouraging solutions for investors that are set to be implemented at the end of next month.
He further noted that this decision may eliminate over 80% of Egyptian exporter’s problems, and will increase the appetite of investors to surge exports during the coming period.
Egypt’s export subsidy is estimated at EGP 7bn of the state budget for fiscal year (FY) 2020/21, compared to approximately EGP 6bn in FY 2019/20 budget, reflecting an increase of 16.7%.
During the meeting, investment entity representatives obtained an immediate decision to withdraw authority to seize financiers from all departments of the Ministry of Finance.
This would include the Egyptian Tax Authority (EGA), in addition to those relating to Customs, Real Estate Tax and Value Added Tax (VAT), so that investors are not seized until after presentation to a committee formed by the Deputy Minister of Finance.
The meeting was attended by, among others, Magd El-Dine El-Manzalawi, a representative of the Egyptian Businessmen Association (EBA); and Mohamed Al-Bahi, a representative of the Federation of Egyptian Industries (FEI) and the EFIA’s Board of Directors.