Under the proposed law, which should be approved by parliament in the next month, foreign food companies could claim up to 40% tax rebates. If passed, businesses involved in education, electricity, manufacturing and pharmaceuticals would also benefit.
The move is to help right Egypt’s economy, which has slumped since the Arab Spring uprising in 2011, which has since been seen to have deterred new investments and cut hard currency reserves in the import-dependent nation.
The proposal also includes streamlining measures to reduce the time it should take to secure business operating licences from some three years to around 60 days. It will also set out to measure the performance of government investment authorities.
"We have designed a temporary incentive programme that attracts certain industries in certain areas," Mohamed Khodeir, chief executive of GAFI, which administers investment licences, told the Zawya news service.
"We are targeting needy areas and sectors that we need to lower their importation and increase their exportation.”
The draft continues government efforts to revitalise Egypts troubled economy, and come in the wake of a US$12bn loan from the IMF last year and approval in January of the country’s first bankruptcy law, which it hopes will also spur investment.
Meanwhile, authorities are continuing a process to reduce the number of beneficiaries of state subsidies by 10%.
Currently, 71m of Egypt’s 92m population have access to subsidised food from a national rationing system, according to the Ministry of Supply, though it estimates that 40% of Egyptians live below the poverty line.
Ration cardholders were given a two-month deadline last week to update their details at registration offices.
Protests are expected as the deadline approaches for the biggest overhaul of a subsidy system that dates back to the Second World War. According to government figures, the supply ministry has set aside EGP86bn (US$4.75bn) to subsidise bread and other staples in its budget for the next financial year.
In recent months, Egypt has suffered from shortage of basic commodities, which the government blamed on what it called “greedy merchants”.