Arab Republic of Egypt Ministry of Investment and Foreign Trade General Organization for Export and Import Control

The Senate discussed, during the general session held today and headed by Counselor Abdel Wahab Abdel Razek, the request of Representative Hesham El-Hajj Ali and more than twenty members, to clarify the government's policy regarding promoting the exports and discuss a request regarding increasing the competitiveness of Egyptian exports. The senate also discussed the report of the joint committee of the Financial, Economic and Investment Affairs Committee and the Office of Industry, Trade, Medium, Small and Micro Enterprises Committee on the study submitted by a member of the Senate regarding export support programs and support for Egyptian exports.

A member of the Senate reviewed a study on export support programs and support for Egyptian exports, and the Egyptian state’s targets of reaching Egyptian commodity exports $100 billion annually can be achieved provided that promising sectors that enjoy the competitive advantages can be identified and assisted to increase the exported quantities and open new markets and to achieve the desired profits for the Egyptian exports, it is recommended to prepare a clear plan to support export support programs and support the Egyptian exports.

The senator recommended that the plan should take into consideration the stability of the policy so that the exporter be aware of the at least three-year plan, and that there is no direct change in the plan or a retroactive decision as happened in Resolution No.13 of 2024, so that the exporter can build his own marketing plan and investment plan. He called for the necessity of updating old production lines with low productivity, rationalizing the import bill and localizing the industry, increasing the export share and the external competition, providing job opportunities and absorbing highly technical labor, in addition to tax facilities and incentives for exporters, including tax incentives and exemptions, and a reduced profit tax for companies on export activities taking into account the differentiation between sectors, tax incentives to support technology and scientific research, and refund the value-added tax on exports according to the product.

A member of the senate requested before the Senate, and said that as a regard to what the global economy witnesses in recent year of successive global variables and crises such as (pandemic Corona - the Russian-Ukrainian crisis - and the Red Sea shipping crisis), and the subsequent disruptions in supply chains, which cast a shadow over the economies of the world's countries, that emerged in unprecedented increases in interest rates, inflation, rising costs, and declining growth rates.

He added that, consequently, the indicators of the Egyptian economy were negatively affected by regional and global developments, which revealed the need to prepare the economic and investment climate in Egypt and search for stable and sustainable foundations for the Egyptian economy, including supporting the industrial sector and paying attention to policies of localizing and deepening industry and preparing the climate for establishments to increase Egyptian exports as one of the important ways to maximize the dollar income. The senator continued: "In this regard, export incentives and export support programs are crucial to achieve export booms to be a major factor in reducing the trade balance deficit, with support directed to promising sectors that can achieve a boom in exports and that support be provided to specific goods and not under a single system for all sectors."

A member of the Senate called on the government to work on enhancing the competitiveness of Egyptian exports by developing the infrastructure, improving the efficiency of transportation and logistics to facilitate export operations, as well as working on enhancing the quality of products by applying international standards and environmental and health requirements, and providing financial incentives and support programs for exporters.

He added that this sector deserves support due to its advantages in quickly bringing in hard currencies to reduce the trade deficit in a short time, as Egypt enjoys a comparative advantage in its geographical location that facilitates the transfer of Egyptian exports to all parts of the world, and it also has a comparative advantage in the weather that allows this activity, and another comparative advantage in the workforce as a large part of the human force is of working age. 

Counselor Abdel Wahab Abdel Razek, the Senate President, stressed that the political leadership and the government pay attention to all recommendations issued by the Senate, noting that these recommendations are greatly appreciated, reviewed and implemented on the long term.

Abdel Razek added that the necessary directives are issued as soon as the proposals reach the concerned authorities, with a close follow-up to ensure their implementation, expressing his aspiration for more studies to enhance the positive impact of these recommendations, stressing the necessity to activate the role of commercial representation offices abroad, so that they have a positive role in the coming period in promoting Egyptian exports and competitive opportunities.

Counselor/ Mahmoud Fawzy, Minister of Parliamentary and Legal Affairs and Political Communication, stressed that increasing Egyptian exports is considered as a national security issue, and the political leadership pays great attention to it, noting that the government’s program includes an integrated vision to the export tax rebate.

Fawzy stressed upon the necessity to adjust some legal terms, explaining that the matter is not related to supporting exports, but rather the rebate for exports, according to the legal principles of international trade, as there is no direct support for exports, but rather export rebate programs are implemented, explaining that the Egyptian program is based on four main axes represented in providing incentives, reducing land and air freight costs, supporting external marketing, either locally or internationally through the Exhibitions Authority, and providing concessional financing (soft loans), and that these pillars are an essential part of the government program.

Mahmoud Fawzy pointed out that the excess of imports over exports leads to a trade deficit, which makes exports a national security issue, as the economy is closely linked to national security, stressing upon the necessity of the self-reliance, noting that increasing exports can only be achieved by enhancing production, as the higher the production volume, the better the export situation and this is reflected positively on the trade balance.

 Fawzy also expressed his happiness with the increased awareness of economic problems, attributing the credit for this to the political leadership that always reiterates the importance of this file.

Major General Engineer Essam Mahmoud Ali El-Naggar, Chairman of the General Organization for Export and Import Control (GOEIC), said that the export file has witnessed a boom during the recent period, as the exports reached $41 billion. El-Naggar continued: "The volume of trade reached $119 billion this year, while the trade deficit reached minus $37 billion for the first time.

Chairman of the GOEIC confirmed that there is a periodic follow-up all the time to reduce the customs release period, within the framework of the package of facilitating customs procedures, facilities and simplifications, and since last December the entire customs system has been operating at full capacity without obtaining a single day off, referring to the facilitations in the visual inspection system as well, and working to speed up the release of production requirements, which in turn contributes to reducing the cost for exporters, and work is underway to facilitate procedures to support exporters in the entire system.

Essam Ahmed El-Naggar, Chairman of Egypt Expo & Convention Authority (EECA), said that the ministry is keen to expand in the African market, through a vision based on many ambitious ideas of the Minister of Investment in this file in particular, and this will be through establishing logistics centers.

El-Naggar continued, "Exporting to Africa faces some obstacles, including transportation and insurance. There is a working group based on the minister's directives to increase Egyptian exports to Africa, through a draft law to ensure such achievement. There is a daily communication with the 14 export councils."

Dr. Amani Al-Wasal, Head of the Trade Agreements Sector at the Ministry of Investment and Foreign Trade, said that to achieve the goal of reaching $145 billion, an annual growth rate of exports of 15 to 20% is needed. She said that the program does not support all exports, but rather supports a select group of exports that face competitive challenges and have a competitive advantage. The export rebate program is limited with duration, the budget is limited in nature, and support is limited for a period and for a specific product. She continued: “What happened between 2002 and 2010 was the development of the program and the basic support rates are based on the percentage of the local component, and there is no equality between the products, each factory is according to the percentage of the local component, a percentage of 10% local component is less than 30% local component.”

She added: There are priorities in the sectors that benefit from the export rebate program, the higher the percentage of the local component, the higher the percentage of support and rebate, and vice versa. She pointed out the interest in the technological component in the program, and that there is a directive to support electronic design services, and therefore it is included in the agenda. There is a vision for the program for a period of 3 years that takes "how much support", which is presented to all business communities. She continued: "There was a basic condition for the program to transfer the proceeds to Egyptian banks, and in this year we resorted to alleviate the restrictions. As for digitization, we started in the fund and digitization will be in two stages."

Counselor Abdel Wahab Abdel Razek, President of the Senate, declared the referral of the report of the joint committee of the Financial, Economic and Investment Affairs Committee and the Office of the Industry, Trade, Medium, Small and Micro Enterprises Committee on the study submitted by Representative Yasser Zaki regarding "Export Support Programs and Support for Egyptian Exports", and the recommendations and proposals contained therein to the government to take the necessary steps to implement them. The President of the Senate also referred a discussion request submitted by a member of the Senate to clarify the government's policy regarding "promoting Egyptian exports abroad and ways to open new markets", and a discussion request also submitted to clarify the government's policy regarding "increasing the competitiveness of Egyptian exports", and the discussions that took place around them and the comments of government representatives to the Industry Committee to prepare a report on them.