CEC submits six proposals to Prime Minister for economic enhancement

Daily News Egypt
3 Min Read

The Chemical and Fertilizers Export Council (CEC) of Egypt has formally submitted six key proposals to Prime Minister Mostafa Madbouly. The proposals include critical measures such as ensuring a consistent gas supply for fertilizer and petrochemical plants and expediting the Value-Added Tax (VAT) refund process for exporters.

Khaled Abul Makarem, Chairperson of the CEC, highlighted these issues during a recent meeting with the Prime Minister. The council emphasized the urgent need for government action to address the challenges faced by the chemical industry, particularly those impacting manufacturing and export capabilities.

One of the primary concerns raised was the inadequate gas supply, which hampers the ability of factories to operate at full capacity. This shortfall leads to sporadic production and has a detrimental effect on both manufacturing and export activities, causing exporters to forfeit their market presence due to non-fulfilment of contractual commitments and delivery timelines.

The CEC also reiterated its call for the Ministry of Finance to honour its commitment to refund VAT on exported goods. Despite prolonged discussions, the Ministry’s reluctance to align with international VAT refund practices has placed Egyptian products and exporters at a competitive disadvantage.

Moreover, Abul Makarem urged the Prime Minister to ensure the reimbursement of export burdens within a 60-day timeframe from the submission date, leveraging the digitalization of the process. He stressed that the current refund delays, which can extend beyond a year, significantly impair the efficacy of the export-rebates programme.

Abul Makarem pointed out that the competitiveness of the export-rebates programme is lacklustre when compared to those of rival nations, which have been successful in bolstering their exports annually. He also underscored the necessity of the burden refund as a vital means for exporters to secure a minimal profit margin, given that many are compelled to sign export contracts at prices barely above cost.

Expanding on the council’s proposals, Abul Makarem advocated for the extension of shipping support to encompass global markets, not limited to Africa. He identified Europe and Latin America as key regions where enhanced shipping support could significantly reduce production and export costs. Additionally, the CEC proposed the initiation of a financing scheme for companies’ working capital at an interest rate capped at 8%.

 

 

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