Egypt’s Minister of Finance Ahmed Kouchouk and Minister of Investments and Foreign Trade Hassan El-Khatib unveiled a new mechanism to settle exporters’ outstanding dues from the Export Development Fund, totaling EGP 60 billion for shipments made up until June 30, 2024, a statement showed on January 8.
Disbursement plan
Under the new mechanism, 50% of the outstanding dues for exporting companies will be paid in cash over the next four years, starting this year, totaling EGP 8 billion annually.
El-Khatib and Kouchouk explained that the government intends to pay the first installment of these dues by January 2025. The remaining 50% will be settled through a set-off system, offsetting exporters’ outstanding and future liabilities with tax authorities, customs, and utility companies such as electricity and gas.
The ministers also announced that, for the first time, exporters’ dues for the fiscal year 2024/2025 will be settled within the same year, with the first installment expected later this month.
However, Sherif El-Sayad, chairman of the Engineering Export Council of Egypt (EECE), expressed concerns to Business Monthly about the new program, noting that exporters may not be satisfied with receiving only 50% of their dues over the next four years. He also highlighted the uncertainty surrounding when the remaining 50% will be paid.
New export program
According to Alarabiya, Egypt decided in November to decrease support for exports from 10% to 2.4%-3% depending on the type of exports, adding that Egypt directed EGP 23 billion to the new export support program.
“All export councils have agreed that it is not feasible to implement the decision to reduce export support rates retroactively starting from last March. In the memorandum, they requested that the new program be applied starting with exports from November of this year, allowing them time to adjust their operations” Vice Chairman of the Agricultural Export Council Mohamed Khalil told Alarabiya.
In this regard, El-Sayad noted that the current 3% export support rate is a significant drop from the previous 10%.
He argued that the new mechanism is insufficient to boost exports and suggested that the budget should instead be directed toward strengthening the new program. El-Sayad advocated for restoring the 10% rate, believing it would provide better support for exporters and drive growth in the export sector.
The statement clarified that between 2019 and 2024, some EGP 70 billion in overdue payments were settled for 2,800 exporting companies.
New milestone
Egypt’s exports reached a historic $40 billion in 2024, El-Khatib announced during a meeting with export council leaders on January 6.
In September alone, exports hit EGP 169,178 million, up from EGP 91,013 million a year earlier, marking an 85.8% year-on-year increase, according to official statistics agency CAPMAS.
Egypt is currently drafting a new program to support exporters starting in FY 2025-2026, with measures being developed to help raise export revenues, increase export volumes, and boost the value-added content of Egyptian products to strengthen their competitiveness abroad.
