Investment in Egypt’s Agricultural Sector: Opportunities and Challenges

 

Egypt has adopted policies that establish a friendly environment for investments in agriculture by providing the necessary infrastructure in the newly reclaimed lands, such as roads, services, lines of credit at a reasonable cost and tax exemption for several years. To encourage agricultural investment in Egypt, the government has drawn a map of agricultural areas, arable areas, natural reserves, as well as the location of conventional and unconventional water resources. In 2007, the first step to modernize agriculture was taken by converting it into a sector run according to the free market economy mechanism as part of the economic liberalization program.

Points of strength in the landscape of investment in Egypt’s agricultural sector are evident in the following:

  • Legislations were issued as part of implementing the economic reform program in Egypt to attract the private sector. To this end, the government drafted the following laws:
  • Law No. 230 of 1989, which covers all economic activities, including agriculture. The Egyptian General Authority for Investment and Free Zones supervises over the implementation of this law in coordination with other concerned parties,
  • Law No. 143 of 1981, which covers land reclamation, plant and animal production and agricultural product processing. The ministry of agriculture also supervises over the Principal Bank for Development and Agriculture, which carries out central planning for credit and agricultural cooperative financing at the national level. Local and foreign investors are treated on equal footing in terms of benefits stipulated in the investment law.
  • The Egyptian government has launched a project to reclaim 1 million acres in the Western Desert. Cairo will announce the full executive steps of the project after the ministry of agriculture locates the lands, offers 50% of the lands for graduates and small-scale farmers and the other 50% for large-scale investors and concludes the final plans for the proposed three cities, East Owainat, West Minia and al-Moghareh as part of the project, as well as a number of towns,

Work has started to establish national infrastructure, provide the necessary irrigation water for areas included in the project in coordination between the ministries of agriculture and irrigation. At the same time, the ministry of housing will provide sketches for models of towns and cities to be built.

 

Image Source: Reuters Pictures

 
 

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