Egypt has expanded the range of industrial activities eligible for investment incentives, offering tax deductions of up to 50% of investment costs to boost local manufacturing and deepen supply chains, the investment minister said on Wednesday.
Prime Minister Mostafa Madbouly issued Decree No. 503 of 2026, which broadens the scope of Article 11 of the Investment Law to include new strategic sectors and link them to specific geographic zones. Under the decree, projects in designated “Sector A” regions will receive a 50% deduction of investment costs from net taxable profits, while “Sector B” projects will receive a 30% deduction.
Investment and Foreign Trade Minister Mohamed Farid Saleh said the deductions would be applied over a seven-year period and are capped at 80% of the paid-in capital.
“The decision represents a qualitative step toward the broader activation of the Investment Law to support the localisation of industry,” Saleh said. He added that the move responds to investor needs and state priorities to increase value-added production and reduce reliance on imports.
The expanded incentives specifically target the automotive industry, covering both traditional and electric vehicles, as well as the manufacturing of electric motors, refrigerator components such as evaporators and compressors, and sheet metal for electrical and electronic appliances. Other added activities include the production of pipes, fruit and vegetable concentrates, and concentrated sulphuric acid.
Farid noted that the geographic distribution of incentives is designed to achieve balanced regional development. Sector A includes the most-needed areas, such as Upper Egypt, the New Administrative Capital, and the Suez Canal Economic Zone. Sector B encompasses the remainder of the republic.
The minister stated that the decree was the result of coordination between the ministries of investment, finance, and industry to ensure the integration of economic policies. He further noted that the government is currently studying the addition of more industrial activities targeted for local manufacture.
The new regulations also encompass activities in engineering, minerals, chemicals, and food industries, aimed at enhancing the competitiveness of national industry and increasing exports, Saleh said.
