The Egyptian Exchange (EGX) and the General Authority For Investment (GAFI) sign MoU
The Egyptian Exchange (EGX) and the General Authority For Investment (GAFI) sign a Memorandum Of Understanding (MOU)
The Egyptian Exchange (EGX) and The General Authority for Investment (GAFI) signed a Memorandum of Understanding (MOU) for mutual cooperation aiming to attract new companies to list in the Egyptian stock market for small and medium enterprises, Nile Stock Exchange (NILEX).
During the press conference following signing of MOU, Dr. Mohamed Omran, Chairman of EGX, emphasized the mutual cooperation between EGX and GAFI to launch the initiative supporting small and medium enterprises that have a proper financial standing in order to diversify their access to funding. He noted that GAFI has provided EGX with ample database for potential companies to NILEX.
Dr. Omran revealed that GAFI provided EGX with the data of more than 8500 of their registered companies of which their capital of ranges between LE 5 million to LE 100 million. This will enable NILEX management to address these companies trying to attract them to list in the market which will initiate new investments and contribute in revitalization of the labor markets to achieve high economic growth in Egypt.
Moreover, EGX Chairman asserted that the MOU signed between GAFI and EGX includes establishing a fund to support small and medium enterprises. This fund is established by GAFI to support NILEX with a capital of LE 1 billion, which will facilitate listing new companies and will contribute in supporting the growth of these companies and increasing their investments. The Chairman also added that the most important success indicator of the fund is its ability to attract new companies to list on NILEX as an arm of financing companies to grow.
Additionally, EGX Chairman stated that the future of the Egyptian economy is significantly associated with the growth of small and medium enterprises as they represent about 90% of the total companies in Egypt. He also asserted that the growth opportunities of the small entities exceed by far those opportunities available to their major counterparts. On the other hand, Dr. Omran pointed out that the recent decline in Egypt's credit rating is due to the unstable political future expectations of Egypt; where he highlighted that these ratings were not of a significant negative impact on the performance of the Egyptian capital market because the financial aspect as well as the fundamental analysis of the companies concerns the investors more when the take their investment decisions.
On the other hand, Dr. Osama Saleh pointed that due to the political circumstances Egypt is going through now which is affecting SMEs, GAFI was keen to have this kind of cooperation with EGX. This agreement will provide support to small and medium enterprises with solid solutions for their stability during the current period. The MOU also aspires to developing domestic investments and support the concept of entrepreneurship in Egypt and accordingly helping in finding practical solutions to unemployment, especially among young people.
GAFI chairman noted that such protocols and bilateral agreements between various institutions demonstrate the interest of the Egyptian Government in investment field. It also reflects government attention to small and medium investor as the cornerstones inthe investment process and the growth of national economy in General.
Dr. Saleh concluded by stating that GAFI will be launching a new program forentrepreneurship "Ryada" during the coming month aiming to build a culture of entrepreneurship among young people. It also aims at transforming ideas and interests than just looking for post to job makers, through successful projects contribute to supporting the economic development of society. He referred to an investment by providing a number of facilities and mechanisms to support small and medium‐sized enterprises, in particular to allocate a separate window for easy construction of small and medium‐sized enterprises within the investment services complexes in Cairo and the provinces.