General Information

Egypt, whose economy is open to foreign investors, is a leading member of the GCC (Gulf Cooperation Council).

In most areas of investment, there is no legal difference between foreign and domestic investors, and there are no restrictions on full foreign ownership of Egyptian companies.

With the new investment law of 2017, Egypt is showing its commitment to creating more favourable conditions for local and foreign investment, including the provision of guarantees and incentives.

There are no restrictions on the convertibility of Egyptian currency into another free currency, provided this is done through authorised legal entities, including banks.

Outgoing transfer of foreign currency is also permitted upon presentation of the required documents and through authorised legal entities. In addition, the Central Bank of Egypt has instructed licensed banks to facilitate the repatriation of dividends belonging to foreign shareholders.

To start up in Egypt, having an Egyptian partner (an agent, distributor or industrial partner in a joint venture) can be very useful thanks to their market knowledge and assistance in dealing with local administrations.

In addition, it is recommended to rely on a local firm to start up a company (advice, administrative procedures, taxation,...). The forms of companies commonly used are classic: Limited Liability Company (SARL), Joint Stock Company (SA), General Partnership (Société en Nom Collectif), Limited Partnership (Société en Commandite). The acquisition of a majority stake in the capital of a local company is in principle permitted (except in a few sectors of activity). 

It should be noted that the Real Estate Law No. 15 of 1963 explicitly prohibits the ownership of agricultural land by foreign individuals or corporations. The definition of "agricultural land" covers land in the Nile Valley, the delta and the oases. In view of the climate emergency and the tensions in the supply of raw materials, Egypt has opened up the acquisition of certain lands to foreign investors, notably Saudi.

In order to support businesses and stem the effects of the health crisis, the Egyptian government has launched an economic support plan described in a dedicated fact sheet.

Against the backdrop of the war in Ukraine, Egypt experienced a strong disinvestment in the country during the summer of 2022, amounting to 22 billion. However, Egypt has been able to count on the financial support of GCC members, notably Saudi Arabia, Qatar and the United Arab Emirates. IMF assistance is expected at the end of 2022. In fact, Egypt is currently experiencing difficulties in accessing foreign currency. It is therefore strongly recommended to use LCs in order to secure its payments.

Means of Payment & Banking Specificities

The country has adopted a series of reforms since 2016, including a floating exchange rate regime. The Egyptian pound depreciated sharply to stabilise around 16EGP/USD. Liquidity has since improved and the Central Bank (CBE) has been able to replenish foreign exchange reserves to nearly USD 44 billion, or about 8 months of imports at the end of June 2019 (source CBE). Since the Covid-19 crisis and its economic downturn, Egypt has called on the IMF and the GCC to support the country through this critical period. There is no doubt that international backers will support Egypt financially given the deep structural reforms already undertaken.

The payment methods usually used internationally are available.  When it comes to imports, however, the documentary constraints common in specific procedures must be taken into account (legalisation, rules of origin, certification, etc.) and the regulations that may restrict the import of certain products. 

A new regulation on imports has been put in place in February 2022 (information note distributed to the networks and available on request). It should be noted that SBLCs are only authorized for the import of products considered essential to the economy (ECB regulation).

Source: MOCI – Coface – Business France – CAE – CASA – FMI – CBE