Egypt’s Cabinet has approved a draft law aimed at establishing financial and business zones, following a decision by Prime Minister Mostafa Madbouly, according to an official statement on February 13.
New draft law
The draft law seeks to regulate operations within these zones, recognizing their critical role in boosting economic growth. It aims to create a balanced legislative framework for the establishment of these districts across Egypt, ensuring optimal outcomes for all stakeholders while adhering to relevant constitutional principles.
The law outlines a regulatory framework for central business and financial districts, defining key stakeholders and clarifying the distribution of powers. It provides general guidelines for the operation of projects within these areas and specifies the guarantees and incentives offered to businesses.
Furthermore, the law separates the functions of regulation and development. The “General Authority for Central Business and Financial Districts,” the regulatory body, is granted extensive authority to establish and approve most rules governing district operations, as well as to oversee the licensing and permitting of activities.
The law also introduces a system for projects focused exclusively on foreign markets. This is designed for businesses that do not intend to enter the Egyptian market but seek to establish branches to manage operations and provide services abroad.
“This is a positive step, as it will encourage new companies to enter Egypt, even if they are not looking to target the domestic market,” said Mohamed Abdel Fattah, Director of Market Access and Government Affairs at Moharram & Partners. He noted that the initiative will attract Foreign Direct Investment (FDI) and generate new job opportunities in the country.
The statement added that the law includes guarantees and incentives specifically aimed at projects dealing with foreign clients. This is part of Egypt’s strategy to attract such businesses and investments amid growing regional and global competition.
The Cabinet noted that these districts will include financial and non-financial services, creating a conducive environment for businesses to offer services, manage funds, and make investments. This initiative is expected to strengthen Egypt’s position on the global capital map, boost foreign capital inflows, and contribute to improvements in macroeconomic indicators, human development, and urban growth.
Abdel Fattah also pointed out that the project will help improve Egypt’s trade balance and balance of payments (BoP), as Egyptian companies will be able to export services internationally.
It is worth noting that Egypt recorded an overall BoP deficit of $991.2 million with the trade balance recording a deficit of $14.0604 billion in the period from July to September of 2024, according to data from the Central Bank of Egypt (CBE).
As Egypt advances with this legislative initiative, the development of these districts could become a significant driver of economic growth and global investment in the country.
Egypt’s Purchasing Manager’s Index (PMI) recorded 50 in January from 48.1 in December, indicating a revival in the health of Egypt’s non-oil economy at the start of the year.
According to the International Monetary Fund’s World Economic Outlook report published in January 2025, Egypt’s real gross domestic product (GDP) growth is expected to reach 3.6% in 2025 and 4.1% in 2026.
