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Industry Committee

Committee Objectives

1. Help members in lobbying with governmental authorities to resolve major obstacles and enhance the climate for economic progress and investment.

2. Work on the advancement and facilitation of industrial development and competitiveness at the fastest possible pace through: Removing the most critical impediments, introducing new ideas, and communicating opinions to decision makers.

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Committee Work Plan

Key Projects / Progress/ Next Steps

1. Sales Tax With the support of the Customs and Taxation Committee, positive relations with the Sales Tax Authorities were established which allowed members to solve certain problems and communicate their issues directly to officials who have shown a remarkable spirit of cooperation. The Sales Tax on Capital goods was thoroughly discussed with Officials who are now in the process of defining the type of equipment that could be exempted from sales tax, and attempting to identify a substitute for the 1.6 billion Egyptian Pounds generated from this tax. Follow up continues.

2. Registration at Ministry of Health Registration of non-pharmaceutical products by the Ministry of Health, which takes a long time and hinders local and export business, was reviewed with officials. Joint solutions were made to catch up with the rapidly changing technology and increase export opportunities. Those proposals are currently under final evaluation by Ministry officials. Meeting will be resumed with the new management at the Ministry for follow up.

3. Egyptian Organization of Standards (EOS) An equally constructive channel was established with the EOS (Egyptian Organization for Standards) to eliminate current obstacles. Products specifications are often outdated, too rigid, vague, etc, which result in wasted resources, inefficiencies, loss of export opportunities, etc. Through various positive meetings, the Industry Committee has capitalized on the new forward-looking approach by the EOS, which aims at simplification and eliminating bureaucratic steps while protecting consumers and ensuring safety of products. Several options were presented to officials and are currently under review. A new committee comprising EOS and private sector representatives was established, including a member from Nestle, to review current standards. The Commercial Fraud Law, is detrimental to existing companies and new ones, and is largely based on EOS regulations. Meetings with Ministry of Supply officials are planned to clarify current problems.

4. Custom Authorities Issues with Custom Authorities, including over-riding and the long import cycle, which increases the cost to Egyptian consumers and make Egyptian exports uncompetitive, are entrenched in the current management of the Custom Authorities. Meetings were made with senior officials and a position paper was presented to the Prime Minister's office but efforts to solve these issues will continue next year. One positive initiative is the new Ministry of Finance's pilot project, starting Dec 2002, which consolidates Sales Tax, Customs, other taxes, in one building in Nasr City to reduce wasted time, avoid duplication and expedite custom clearance as suggested by the Industry Committee. A second positive initiative is the appointment of Mr. Hassan HegazyChairman of the AmCham Customs & Taxation Committee as member of the Custom Development Committee by the Minister of Finance. Meetings are planned with new custom officials for follow up.

5. Export Promotion To help promote exports, meetings are planned with the Minister of Foreign Trade and other officials to open direct channels for members.

6. Anti Monopoly Draft Law The current draft is very alarming to many manufacturing companies and could discourage new investment. The Committee will join the AmCham Legal Affairs Committee, plus other forums, to address key problems with current draft.

7. Industry Modernizations and Upgrade As a service to the manufacturing community at large, the Committee will arrange an educational presentation on "Supply Chain Management", perhaps jointly with the AmCham Human Resources Committee. Furthermore, members have expressed to the Minister of Industry their intention to help in the Industry Modernization Program.

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Contacts

Chair: Mr. Mostafa El Halwagy, Heinz Egypt
Co-Chair: Mr. Hubert George, Colgate-Palmolive Egypt
Committee Liaison: Shahira Rifaat, (Tel: 3338-1050, E-mail: srifaat@amcham.org.eg)

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