1 ΓΡΑΦΕΙΟ Ο.Ε.Υ. ΚΑΪΡΟΥ Egypt The most promising market in the Middle East - North Africa Evangelos Dairetzis Counselor, Economic & Commercial Affairs.

1ΓΡΑΦΕΙΟ Ο.Ε.Υ. ΚΑΪΡΟΥ

Egypt

The most promising market in the

Middle East - North Africa

Evangelos DairetzisEvangelos Dairetzis

Counselor, Economic & Commercial AffairsCounselor, Economic & Commercial Affairs


Egypt: Gateway to Africa and the Middle East


Strategic position in the Mediterranean Strategic position in the Middle East and

Africa The largest market in the Arab world The most stable country in a volatile

region Gateway for the Greek products to the

region


Area: 1.001.450 sq. km. Population: 85.000.000 in. Density: 3 in. / Km²

Largest cities

Cairo: 14.000.000 Alexandria: 4.500.000 Port Said: 610.000 Suez: 550.000 Luxor: 490.000

Cairo: GMT + GMT +22


The Egyptian economy

GDP $ 262 billion Per capita GDP $ 6.600 GDP Growth 2.1% (2012/13), 3,5% 2013/14 (est.)

Inflation 11,4% (Αug. 2014) Unemployment 13,4% (Μarch. 2014) Public debt 83.4% (2012/13) GDP Budget deficit: 13.8% (2012/13) GDP

Sharp decline of 5 years CDS of state bonds


GDP structureGDP structure


Egypt imports 2013 value share

Item $ 1000 %

PETROLEUM OILS 3.590.086 10.91

PETROLEUM CRUDE 2.024.648 6.15

YELLOW CORN, NOT FOR SHOWING 1.941.596 5.90

WHEAT 1.940.742 5.90

LIQUIFIED BUTANES 1.570.451 4.77

SEMI-FINISHED IRON PRODUCTS 1.518.479 4.62

MEDICINES 1,099,404 3.34

ARTICLES OF IRON & STEEL 1.095.947 3.33

FUEL OIL 955.313 2.90

MOTOR VEHICLES 926.570 2.82

GOLD 909.189 2.76

WOOD SAWN OR CHIPPED 839.167 2.55

IRON WASTE & SCRAP 836.806 2.54

95 OCTANE GASOLINE 830.101 2.52

BOVINE MEAT, BONELESS 826.892 2.51


Main suppliersMain suppliers 2012

$ mil. share

2013 $ mil.

share % 13/12

China 6.732 9,8% 6.961 10,9% 3,4%

Germany 4.749 6,9% 5.200 8,1% 9,5%

USA 5.372 7,9% 5.174 8,1% -3,7%

Italy 3.511 5,1% 3.535 5,5% 0,7%

Ukraine 3.941 5,8% 3.143 4,9% -20,2%

S. Arabia 2.739 4% 3.033 4,7% 10,7%

Turkey 3.511 5,1% 2.618 4,1% -25,4%

Kuwait 2.679 3,9% 2.598 4,1% -3,0%

Brazil 2.922 4,3% 2.273 3,6% -22,2%

India 2.293 3,35% 2.259 3,5% -1,5%


Greek – Egyptian TradeGreek – Egyptian Trade2012 - 20132012 - 2013

€ mil. 2012 2013 % 12/13

Exports 345.386.332 593.468.273 72%

Imports 444.391.206 576.500.234 29,7%

Trade volume 789.777.538 1.169.968.507 48,1%

Trade Balance -99.004.874 16.968.039 117,1%


Greek – Egyptian Trade 2010-2013


GREEK EXPORTS TO EGYPT 2013 2013 % SHARE 2013

TOTAL 593.468.273

'27' MINERAL FUELS & OILS 406.931.716 68,6%'52' COTTON 63.621.851 10,7%'25' SALT, SULPHUR, EARTH & STONES 28.961.999 4,9%'08' EDIBLE FRUITS & NUTS 18.163.855 3,1%'24' TOBACCO & MANUFACTURED SUBSTITUTES 11.348.257 1,9%'84' NUCLER REACTORS, BOILERS, MACHINERY 8.377.403 1,4%'73' ARTICLES OF IRON & STEEL 7.112.353 1,2%'39' PLASTICS & ARTICLES THEREOF 5.899.786 1%'48' PAPER, PAPERBOARD, ARTICLES OF PAPERPULP 5.164.955 0,9%'20' PREPARATIONS OF VEGETABLES, FRUIT, NUTS 4.950.467 0,8%'72' IRON AND STEEL 4.296.783 0,7%'38' MISCELLANEOUS CHEMICAL PRODUCTS 2.954.339 0,5%'87' VEHICLES, PARTS & ACCESSORIES THEREOF 2.804.324 0,5%'32' TANNING OR DYEING EXTRACTS, DYES, PIGMENTS 2.777.962 0,5%'85' ELECTRICAL MACHINERY, EQUIPMENT & PARTS 2.716.260 0,5%'31' FERTILISERS 1.988.008 0,3%'49' PRODUCTS OF THE PRINTING INDUSTRY 1.519.960 0,3%'04' DAIRY PRODUCE; BIRDS' EGGS; NATURAL HONEY 1.468.829 0,2%'11' PRODUCTS OF THE MILLING INDUSTRY 1.325.490 0,2%'23' RESIDUES FROM FOOD INDUSTRIES, ANIMAL FODDER 982.976 0,2%'15' ANIMAL OR VEGETABLE FATS AND OILS 706.944 0,1%'76' ALUMINIUM AND ARTICLES THEREOF 703.537 0,1%'34' SOAP, WASHING & LUBRICATING PREPARATIONS, WAXES 604.067 0,1%

Greek – Egyptian Trade, 1st Semester 2014

€ mil. Jan-Jun 2014 Jan-Jun 2013 %13/14

Exports 490.505.170 347.140.985 41,3%

Imports 464.552.957 185.825.308 150%

Trade volume 955.058.127 532.966.293 79,2%

Trade Balance 25.952.213 161.315.677 521,6%


Egypt Today

Turning points: the revolutions of January 25, 2011 and June 30, 2013

Government and a charismatic elected president with broad popular support

Parliamentary election expected by the end of the year Gradual return of the country to normality Security has

been restored to the greatest extent Powerful and capable economic team to manage and

restart economy Clear signs of recovery of the Egyptian economy


Government Priorities

Restarting the economy, attracting foreign investment

Ongoing investment program:15 mega projects of $ 100 billion to boost economy (Canal Suez Corridor, new land for agricultural use, road, railway network)

Infrastructure, security, education, housing, health, energy, agriculture, renewable energy resources

Continued financial support by Arab States – Egypt’s stability crucial, not only for the region

The negative image of Egypt projected by Western media

(mainly via Al Jazeera) is not realistic


Energy (renewable)

Infrastructure

Telecommunications - new technologies

Transportation

Health

Education

Agriculture

Sectors with high growth rates


Investment required in time and effort to establish oneself in the market

Reliable local partner in problem solving Detailed knowledge of legislation

procedures prior to any agreement. Use of lawyer recommended Ensure of exporter by letter of credit

Market characteristics


Overregulation, delays at customs Cumbersome commercial justice system Price is the dominant factor, followed by

quality Consumption peak period: two months

before and during Ramadan Emerging market with considerable yields


Gateway for re-exporting to countries in the wider region

Preferential agreements with Arab, Nile basin countries, African countries (COMESA)

Positive image of Greece in Egypt but incomplete. Most known for its food products

Greek traditional products are popular, though not successfully enough due to lack of a comprehensive strategy on behalf of the Greek exporters


Greek products, due to price, are addressed to middle class consumers

Satisfactory performance but not as successful as of Italian and Spanish competitors

Labeling in Arabic offers clear advantage to the product (successful cypriot example)


Egyptian legislation one of the most favorable regarding commercial representation

Non Egyptian national is not allowed to set up commercial importing company


EnergyEnergy

RENEWABLE ENERGY SOURCES State target: Cover 20% of energy needs by

2020 Significant solar and wind resources Funding: State budget, international

organizations and developmental tools of western countries

Prospects for Greek enterprises: using solar energy for solar farms and household, industrial and tourist use

Government has adopted new law Government has adopted new law establishing new feeding tariffs for solar establishing new feeding tariffs for solar and wind energy (at 0.8 and 1.05 piasters and wind energy (at 0.8 and 1.05 piasters per kW respectively). This might stimulate per kW respectively). This might stimulate alternative energy investmentsalternative energy investments



HEALTH SECTORHEALTH SECTOR

Drugs - medical equipment: 10% increase in demand per year

The vast majority of medical equipment is imported

Upgrading the health system creates business opportunities (hospital supply)

Private medical centers


FranchisingFranchising

460 companies (65 American) 24% foreign names $ 7 billion investment mainly in the food

sector Prospects: food, clothing, foreign

languages teaching , furniture, accessories-gifts, hotels, electronics

Significant opportunities for Greek products also because of : Upgraded political relations with Greece Crisis with Turkey is shrinking its market

share Civil War in Syria (affected mainly the fruit

market) and Libya (trade through Egypt) Prospects of increased maritime and port

cooperation


ConstructionConstruction

Μακέτα του νέου Διοικητικού Κέντρου


INFRASTRUCTUREINFRASTRUCTURE Highways Railway network Airports Inland road network Hospitals, schools Power stations, RES Housing units Tourist complexes Water - drainage Desalination plant

The Ambitious “ Suez Canal Development ptoject”

Ports Industrial zones Tunnels Residential areas Tourist areas Fish farming Logistics centers



FOODSTUFFFOODSTUFF

Egypt imports basic foodstuff The world's largest importer of wheat Greek products: middle class (15 mil.) Significant perspectives for Greek fresh fruits Meat and poultry products: Helal certification Packaged agricultural products, juices, milk,

snacks, pre-prepared meals, pastries, frozen meats, seafood


TARIFFSTARIFFS

Association Agreement 2004: phasing out tariffs within 15 years

Tariff information (EU Market Access Database): http://madb.europa.eu/madb/indexPubli.htm


TARIFFS

Foodstuff: 0-32% Alcoholic Drinks 1200-3000% - 300% for "tourism purposes" 10% sales tax on commodities


Corporate tax

Corporate tax: 25% Companies in energy sector of 40%-55% Personal income tax up to 25%


Legal forms of companies

Ανώνυμη Εταιρεία (Joint Stock Company) Εταιρεία Περιορισμένης Ευθύνης (Limited

Liability Company Ομόρρυθμος Εταιρεία (General

Partnership) Υποκατάστημα (Branch) Γραφείο Αντιπροσώπευσης

(Representative or Liaison Office)


Investment Law 8/1997

Guarantee of capital repatriation, right to hold foreign currency accounts

Preferential treatment and incentives (manufacturing, infrastructure)

Information about the current status of investments: General Investment Authority (GAFI)www.gafinet.org


The most significant trade fairs

ΙΝTERBUILD (building materials) www.interbuildegypt.com

SAHARA (agriculture) www.saharaexpo.com

HACE (hotel equipment, restaurants etc.) www.hace.com.eg

AGROFOOD (foodstuff, agroindustry) www.agrofood.com.eg/

ΕGYMEDICA( medicines, medical equipment) www.egymedica.com


Direct sale: dealer - distributor Tenders Participation in exhibitions Trade mission organized by business

entities franchising

ENTRY TO THE MARKET - PROMOTION


TECHNIQUES

Egyptians entrepreneurs: cosmopolitan, international experience, very good negotiators

Cultural specificities: every price is negotiable,sluggish bureaucracy

Advertising in newspapers and magazines, growing role of TV, street posters, “junk mail advertisement”


Greek investment

Banking, constructions, shipping, energy (exploration and production), food industry, irrigation, clothing, packaging, etc.

$ 1,2 billion 50 Medium and large scale companies





Sectors of the Egyptian economy and prospects for Greek products

and services Energy: Renewable energy Environment – water treatment, recycling Transportation Shipping: construction - expansion ports, passenger transport Construction: undertake projects, construction materials Agriculture: agricultural machinery, irrigation equipment, construction

equipment and greenhouses, fertilizers, oil formulation, aquaculture, agribusiness

Health (hospitals, medical equipment, drugs) Education and training Manufacturing - industrial cooperation Foodstuff Transportation Telecommunications


New technologies Freight and passenger transport Shipbuilding Financial Sector Security systems for companies, individuals, government Franchising (foods. Wear, foreign languages , furniture,

accessories-gifts,

227 Greek companies export products and services in Egypt

INTERNATIONAL ECONOMIC FORUM

International economic summit scheduled for February of next year.

The summit will encourage international companies and organizations to invest in the country and contribute to its development.


EMBASSY OF GREECE – OFFICE FOR ECONOMIC &

COMMERCIAL AFFAIRS - COMPANIES

Greek Investors Club (Business Club) Egyptian – Greek Business Council (EBA - SEV)

Active support for Greek investors Assistance (advocacy) towards Authorities Promotion of Greek products and services

TRADITIONAL GREEK PRESENCE

Patriarchate of Alexandria Greek communities in Cairo and

Alexandria Greek schools Associations and Clubs of the Greek

community Greek Chambers of Cairo and Alexandria


OFFICE FOR ECONOMIC & COMMERCIAL AFFAIRS

EMBASSY OF GREECE IN CAIRO

ΤEL. +202-27948482

FAX +202-27940684

e-mail: [email protected]

Website: www.agora.mfa.gr

1 ΓΡΑΦΕΙΟ Ο.Ε.Υ. ΚΑΪΡΟΥ Egypt The most promising market in the Middle East - North Africa Evangelos Dairetzis Counselor, Economic & Commercial Affairs.

Documents