Egypt welcomes more Chinese investment and is expecting China to be Egypt’s main investor, Egyptian Minister of Investment Mahmoud Mohieddin said on Monday evening.
During an interview with Xinhua and other Chinese media, Mohieddin said that Chinese investors are welcome in Egypt where its market welcomes competition and rejects monopoly.
“With growing interest, Egypt sees the rise of Chinese investment, which grows in various sectors, such as communication, technology, construction, manufacturing, agriculture, service as well as tourism, and currently financial service is the only sector still awaiting the Chinese investment,” said Mohieddin.
As for security measures to protect the Chinese investment in Egypt, Mohieddin explained that Egypt and China signed in 1994 an agreement to encourage and protect mutual investment, which means to treat mutual investment in each other’s country without discrimination.
“Egypt is a country of law and order, a country observes obligation and adopts international standards. Egypt has an arbitration mechanism, and plans to set up a specialized economic court to solve the potential disputes between companies, if there is any,” he added.
Egypt, the first Arab and African country to establish diplomatic relations with China in 1956, has a long history of friendly ties with China, which serves as an advantage to promote bilateral economic and trade cooperation and investment, said Mohieddin.
Egypt has good investment opportunities for China, whose investment reached 300 million U.S. dollars in Egypt in 2006, he said, noting that China has played an important role in the construction of Egypt’s northwest Suez special economic zone.
The foundation stone-laying ceremony for the construction of a none-stop investment service building in the zone, which was financed by China, was held in February, he noted.
As for Egypt’s domestic privatization process, Mohieddin said the program recently develops at a high speed, adding that the process needs the participation of other economies, especially the United States, European countries, India and China.
Egypt is improving its economic systems and has taken many reforming measures to streamline investment procedure, lower tax and tariff rates.
It axed its corporate tax down to 20 percent from 40 percent and customs to seven percent from an average of 15 percent two years ago, which heralds a sharp increase in foreign direct investments (FDI).
Egypt’s FDI is projected at 8 billion dollars in 2006/2007 financial year, up from 6.1 billion dollars in 2005/2006 financial year (as from June 30, 2005), according to Mohieddin.
Reform measures undertaken by the Egyptian government have not only played a key role in terms of attracting foreign investment, invigorating and sustaining high levels of growth and employment, but also been recognized by international institutions as well.
Earlier this month, Egypt, along with six other countries, was named as the top reformer of investment and business climate by the World Bank’s forum for economic reform in Washington.
Egypt is the only country in the Middle East and North Africa region to appear on the list, which also includes Mexico, Tanzania, Guatemala, Rwanda, Belgium and Georgia.