Egypt signed a partnership agreement with the International Finance Cooperation (IFC) to support entrepreneurs, start-ups in Africa, boost innovation and drive economic growth.
The agreement was signed by Minister of Investment Sahar Nasr and IFC's head of the Middle East and North Africa region Mouayed Makhlouf.
Upon this agreement, the Minister of Investment and IFC will select 100 promising entrepreneurs from all over Africa to connect them with international businessmen, investors, financial institutions and decision-makers at the 2018 Africa Conference during December in Sharm el-Sheikh, under the patronage of President Abdel Fatah al-Sisi.
Nasr said that this agreement will enhance Egypt’s position as a regional hub to attract entrepreneurs and emerging innovative companies and create a favorable enabling environment for these companies across Africa, which will help them grow, raise capital and maximize global reach.
IFC clarified that during the last two years, it provided around $65 million to technology companies and startups in the Middle East and North Africa, along with leading companies in business accelerators and funds such as Wamda and Flat 6 Labs and Algebra Fentures.
IFC Vice President for the Middle East and Africa Sergio Pimenta said that entrepreneurship is essential to create jobs, drive growth and foster innovation, adding that “overcoming the obstacles facing emerging companies will enable us to help Africa unleash its economic potential."
For his part, Makhlouf stated that small businesses, including emerging ones, are the cornerstone of most economies in Africa and the Middle East.
"Governments across the continent can help create jobs and opportunities for their people by providing them with access to capital and guidance," he added.
IFC invested in Egypt during current year $1.2 billion, which is the highest investment rate in the Middle East, especially after taking a lot of measures to improve the investment environment, according to Makhlouf.
He said that today's agreement is the best opportunity to create jobs and remove obstacles that may face entrepreneurs and young people.
He explained that the growth rate in Egypt has become 5.8 percent, and the removal of obstacles facing small investors and increasing employment opportunities would lead to an increase in growth rate.
Egypt embarked on a bold economic reform program that included the introduction of taxes, such as the value-added tax (VAT), and cutting energy subsidies, with the aim of trimming the budget deficit.
Egypt also provides facilities in its economic climate and legislative reforms to encourage investors to invest in Egypt.
The legislative and regulatory aspects include the issuance of several laws and regulations, namely the new investment law and its executive regulations, the law of restructuring and reconciliation, bankruptcy and postponement of financing and privatization, and the amendments of the law of companies and the capital market and their executive regulations.
The new investment law includes a number of clear incentives and full guarantees for investors, providing them with several incentives and treats men, women, Egyptian and foreign investors equally.
The law also stipulates that foreign employees should not exceed 20 percent of the total number of workers in the projects established by non-Egyptian investors.
Moreover, the bankruptcy law regulates the financial and administrative restructuring for failed projects and companies, eliminating prison sentences in bankruptcy cases and limits punishments to a monetary fine.
It also aims to minimize the need for companies or individuals to resort to the courts and to simplify post-bankruptcy procedures.
The state also established the investors’ service center that provides services to aid in the procedures of establishing a firm, its contract, documentation, licensing and commercial registration.
On Wednesday, the IFC announced that it supported the Middle East and North Africa’s private sector, boost innovation, drive economic growth, and create jobs with $2 billion in 2017/2018.
IFC, a member of the World Bank Group, provided over $1 billion in financing for its own account and mobilized another $1 billion from other investors in the region in fiscal year 2017/2018.
It referred a statement to its support which enabled businesses in the region to provide more than 119,000 jobs, distribute power to about 500,000 people, and deliver health care to more than 2.9 million people.