Years of political unrest have roiled Egypt’s economy and caused instability that resulted in foreign investors pulling out, which worsened the problem, and over time, the situation snowballed. Today, in order to rise out of the morass, the country’s economy needs an influx of some $200 to $300 billion in foreign investment.
So, in an effort to make Egypt more attractive to investors, President Abdel Fattah Al Sisi launched significant reforms to kick-start the economy and improve the business climate. This includes cutting income tax rates, establishing new mechanisms to resolve commercial disputes, and passing a new law providing incentives and legal protections for investment.
“All of these things are key to attracting new investment,” said Secretary of State John Kerry at the Egypt Economic Development Conference, which took place in mid-March in the Egyptian Red Sea resort of Sharm el-Sheikh. “Everybody knows that money, capital, behaves in fairly predictable ways. And those who make decisions about investment look for certainty. They look for confidence. They look for the knowledge that, if they invest, what they’re investing in will be a transparent and accountable transaction.”
The United States believes that as the region’s most populous country, Egypt has a crucial impact on the entire region. So a stable, prosperous Egypt means a stable, prosperous region. That is why the U.S invests in Egypt-- about 2.2 billion dollars’ worth, or 20 percent of all direct foreign investment.
“We are providing economic assistance in the hundreds of millions of dollars that will be directed to small business enterprises and to new startups, because we want to see a sustainable economy grow in Egypt,” said Secretary of State Kerry.
“It is strategically important to this region and to all of us who are looking for stability and for a better standard of living and greater inclusivity and participation by citizens. It is important to make certain that Egypt can move along the road to development and to the full achievement of its democratic aspirations. And that’s something the United States will remain committed to.”
