Egypt’s Investor’s Union desperate about future
A recent report conducted by the Investors Union stated that approximately 1500 factories in Egypt have either closed or are operating at reduced capacity. Production has been falling since the economic crisis began and the number of factories to close will be increasing especially those importing raw materials to be used in local production.
The pound has been depreciating and the costs of materials have been rising while demand has been going down. Mohamed al-Murshedi, vice president of the Federation of Investors and president of the Textile Industry Division, said nearly 40% of Egyptian yarn and textile factories have shut since the beginning of the revolution. The industries are also facing stiff competition on the global market.
Osama al-Tabei, a member of the Board of Directors for the Federation of Investors and president of the Investors Organisation of New Domietta, said a total of 28 small and mid-sized factories had been shut down in the Domietta region, primarily in the furniture and building and printing materials sectors.
The central bank is urging other banks in the local market to prioritize the funding of closed factories. The National Bank of Egypt has already helped six industries to resume. Abu al-Alaa E al-Naga, secretary general of the Federation of Investors and vice president of the Investors Organisation for the 10th of Ramadan City, said over 200 factories in the region had shut down or were operating at reduced capacity. He added that a number of these factories had closed because of their inability to make repayments.
Some large factories such as Abu al-Sabaa and Fajar Al-Mahala are also affected and almost 100 small and mid-level factories had been shut down due to their inability to obtain adequate resources. These included textile, food and printing resource factories.