Fitch Agency.. Egypt excels regionally in the growth of renewable energy and enhances foreign investment

Enhancingeconomic growthand attracting foreign direct investments is one of the most prominent priorities of countries seeking to achieve comprehensive sustainable development. Economic growth has become closely linked to the ability of countries to develop their infrastructure, improve the business environment, and adopt structural reforms that enhance their competitiveness on the international stage, such as enhancing reliance on renewable energy.

In this context, the Egyptian experience stands out as a model that reflects a strategic trend towards openness to foreign investments, through an integrated package of policies and legislative reforms, developing special economic zones, and expanding the scope of infrastructure, in line with the requirements of the modern global economy. This comes in parallel with the state’s efforts to diversify investment-attracting sectors and enhance its regional role in energy, trade and logistics, in a way that supports Sustainable Development Goals (SDGs) in the long term.

Expansion of foreign investment flows in Egypt

In this context, the global Fitch Ratings agency issued a report, entitled “Analysis of Egypt’s Openness to Investment,” which pointed to the great potential for foreign direct investment in Egypt, and the expansion of investment flows in many sectors, most notably: oil, gas, automobiles, information and communications technology, and food manufacturing, in addition to renewable energy, infrastructure, and financial services, stressing that Egypt ranks third out of 18 markets in the Middle East and North Africa, And ranked 27th globally out of 202 markets, in terms of investment openness.

The report pointed to several factors driving an increase in foreign direct investment flows in Egypt, including: the dynamic growth of the Egyptian economy, the strategic geographical location, the availability of a skilled workforce, its unique tourism potential, large energy reserves, a vast domestic market, and successful reforms, stressing the importance of the regional context as an important factor.

Egypt is an important investment destination in Africa

Egypt has set achievable goals for foreign direct investment until 2030, including attracting about $60 billion in inward investment during the period 2026-2030. For comparison, the entire African continent usually attracts less than $60 billion annually in foreign direct investment flows, and with the exception of exceptional mega projects, Egypt usually attracts between $9 and $11 billion annually in foreign investment, which makes the goal achievable. For investigation.

The report also highlighted Egypt’s position as an important investment destination in North Africa. It has attracted multinational companies in the automotive, pharmaceutical, and electronics sectors, and investment facilitation has been enhanced through the implementation of a single approval system for project licenses and permits in 2023, in addition to providing financial incentives to encourage green hydrogen. The rise in investments in manufacturing industries and major infrastructure projects through the development of special economic zones represents a promising area for Egypt. Infrastructure development also continues to gain momentum.

Chinese projects inside Egypt

The report noted that the Chinese government announced plans to invest in projects inside Egypt within the Belt and Road Initiative, with investments amounting to $400 billion in more than 600 projects within the initiative across 57 member states of the Organization of Islamic Cooperation until 2030, and Egypt is one of the most prominent participating economies. These projects include the establishment of an economic zone in the Suez Canal region, and investment in maritime and land transport facilities.

The report expects Egypt to excel regionally in the growth of renewable energy capabilities as a result of policy reforms since 2014, which opened the market to private sector investors, by offering large renewable energy auctions and reducing electricity subsidies, which led to rapid growth in solar and wind energy investments, with long-term benefits for local industries.

Green transition and sustainable development priorities

With awareness of the challenges associated with climate change, the report indicated that the country is moving towards increasing green investments, so that all new public investments will become green by 2030, reflecting a gradual transition towards a more sustainable development model.

Egypt is also working to accelerate the goal of raising the percentage of renewable energy to 42% of total electricity by 2030 instead of 2035, with a focus on solar energy, wind, green hydrogen, water desalination, sustainable transportation, and smart cities, in a way that enhances the balance between economic growth and preserving natural resources for future generations.

Comprehensive legislative reforms to enhance the investment climate

The report explained that Investment Law No. 72 of 2017 and its amendments provide an integrated framework to support investors, through multiple incentives that include tax exemptions, the “one-stop-shop” system, and facilitating land allocation, in addition to granting residence permits to investors throughout the project period.

The law also guarantees the freedom to transfer profits and access to international financing without restrictions, in addition to supporting technology zones targeting the software industries, data centers and outsourcing, in a way that enhances the building of a knowledge-based economy and serves Sustainable Development Goals (SDGs) by diversifying sources of growth.

In conclusion, in light of the positive indicators presented by the global “Fitch Ratings” agency report regarding the openness of the Egyptian economy to foreign direct investment, it is clear that Egypt is moving on an integrated reform path that adopts a reformulation of the investment environment through developing infrastructure, modernizing legislative frameworks, and expanding the scope of special economic zones, in a way that enhances its competitiveness regionally and internationally.

TheThe Earth Guards Foundation highlights the positive indicators revealed by reports issued by prestigious international institutions such as Fitch Ratings that reflect the growing performance of the Egyptian economy and its ability to achieve rising growth rates, thus enhancing the path of economic stability. These data confirm that this momentum constitutes a real foundation that supports efforts to achieve comprehensive sustainable development in its three social, economic and environmental dimensions, by directing this growth towards more balanced and sustainable paths.