Egypt’s Ministry of Finance has announced the disbursement of $104 million in export subsidy dues to 360 companies. This financial support is part of the Export Development Fund’s initiative to enhance liquidity for exporting companies, helping them to overcome challenges and boost their production and export activities.
Since the inception of the lump-sum export subsidy dues payment initiative in October 2019, the Egyptian government has provided approximately $1.15 billion in support to exporters. With the completion of the seventh phase of this initiative, the total support is expected to reach $2.27 billion (EGP 70 billion).
Starting Thursday, 360 eligible exporting companies will receive EGP 5 billion, with additional installments scheduled for June 27 and August 8, bringing the total disbursement for this phase to EGP 10 billion.
To ensure transparency, the government will adjust financial obligations between exporters’ support dues and state authorities’ receivables, such as taxes, customs duties, electricity, and natural gas fees. This measure highlights the government’s commitment to stimulating economic activity, particularly in the industrial and export sectors. The budget for the next fiscal year allocates EGP 40.5 billion for these initiatives, with EGP 23 billion dedicated to the rapid recovery of export burdens.
Nevine Mansour, Advisor to the Deputy Minister of Finance for Financial Policies and Institutional Development, noted the successful cooperation with the banking sector, the Ministry of Trade and Industry, and the Export Development Fund during the previous six stages of the immediate cash payment initiative. The seventh phase has received strong participation from exporting companies.
Mansour also explained that the terms for the seventh phase remain consistent with previous phases. Discounts on accelerated payment rates include 15% for shipments until June 30, 2021, and 8% for shipments from July 1, 2021, to June 30, 2022. No discounts will apply to shipments from July 1, 2022, onward.
The export support payments are facilitated through the National Bank of Egypt (NBE), Banque Misr, Banque du Caire, and the Egyptian Export Development Bank. This initiative reflects Egypt’s strategic focus on strengthening its export sector and supporting companies in navigating the global market.
photo source: Google
By: Montel Kamau
Serrari Financial Analyst
6th June, 2024
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