Egyptian delegation from the U.S-Egypt Council is scheduled to hold a visit Washington in April to discuss the ways to increase investments and trade exchange between the two countries.

The delegation will be comprised of representatives from a number of Egyptian companies and economic institutions. They will meet with American businessmen and officials of senior companies in addition a number of American official.

Omar Mehanna, chairperson of the US-Egypt Business Council, expects economic relations between Egypt and the US to recover under the new US administration led by president Donald Trump.

He added that total US investments in Egypt until March 2016 are estimated at about $21.4bn, and likely to increase in the next period. He added that the trade exchange between Egypt and US amounted to $3bn from January to June 2016, of which $2bn were imports, pointing out that the coming period will witness more trade cooperation between the two countries.

Mohanna said that US investments in Egypt and the volume of the trade exchange do not accurately reflect the real relationship between the two countries. He added that Egypt has witnessed significant economic changes in 2016, most notably the frequent hikes of the US dollar exchange rate and the Central Bank of Egypt’s (CBE) decision to float the Egyptian pound in November, as well as the partial liberalisation of fuel prices.

 

Mehanna called for the abolition of taxation at the Suez Canal Economic Zone to attract more foreign investments, similar to other world economic zones, such as Jebel Ali in the United Arab Emirates. He said that Egypt imposes an exaggerated tax of 22.5%, pointing out that the tax cuts would contribute to increase investment and production.

He pointed out that the CBE’s decision to liberalise the exchange rate was very important, as the existence of two prices of the dollar in the country represented an obstacle which prevented attracting foreign investment, as well as the scarcity of foreign currency at banks before the decision which had prevented corporations from transferring their profits abroad. He added that the flotation of the pound had significantly contributed to the improvement of the business environment, noting that the council has received positive reactions from US investors on the decision.

He considered the liberalization of the local currency as the most important decision taken by the government in recent years, even more so than the issuance of a new investment law. He added that the Egyptian government had promised foreign companies to allow the transfer of their profits in dollars and the recent decisions showed that Egypt is serious about providing a good investment climate.

The Egyptian official pointed out that the lack of dollar liquidity in the official market led to the decline of trade exchange between Egypt and the US in 2016.