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2. Industry in Egypt
2.1. Introduction
Egypt was known for ages as an agricultural country and the governors never paid attention
to industry till the beginning of 19th Century. Egypt witnessed a huge industrial revival
when Muhammad Ali created a great industrial base including textile, sugar, cooking oil
squeezing, rice mills and the military industries flourished. A shipyard and factories for
preparation of chemical materials were established. The industrial revival declined during
the following periods till the end of World War I.
Misr Bank was founded in 1920 with Egyptian capital led a campaign to revive the Egyptian
industry. The bank succeeded in establishing an industrial base that included a chain of
great companies and factories which succeeded in establishing an advanced Egyptian
industry. The July 1952 Revolution launched a number of pioneering heavy industry
projects such as iron and steel, mining, petroleum, chemical, spinning and weaving and
food industries.
The period from 1967 to 1973 negatively affected the performance of the industrial sector
due to war and it was revived again after 1973 when the open-door economy policy was
actively embraced.
As peace prevailed, Egypt began a new stage of industrial development. By virtue of the
economic reform policy that started in 1990s of the past century, the role of the private
sector increased in achieving industrial development. The industrial sector enjoyed a wide
variety of privileges and incentives to investors.
At the early beginning of 21st century, Egypt has started a stage of reviving the Egyptian
industry and both industry and both foreign and internal Trade under one ministry in the
government . Modernization of Egyptian industry was essential for quality improvement of
products in order to provide a stronger competition within the World economy. Besides, an
atmosphere suitable for industrial and commercial activities was necessary to encourage
the private sector in assuming the main role in achieving economic development.
2.2. Industrial Investment
Egypt has recently witnessed a marked improvement in the atmosphere of investment due
to several elements topped by amending customs tariffs, issuing the new tax law, launching
the Great Free Arab Trade Zone beginning January 2005, issuing the law of Investment No.
13 of 2005 that aims to facilitate the procedures of investment through establishing the
unified service centers, establishing the public Association of Industrial Development that is
in charge of the industrial developing policies and responsible for developing the industrial
areas which is qualified to attract industrial investment.
More land was allocated to the Industrial Development Authority which reduced the price of
land and facilitated bank lending. Reduction of the price of land and energy combined with
a low labor cost help to attract foreign industrial investment into Egypt.
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THE RESEARCH AND INNOVATION SYSTEM IN EGYPT