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Final Project Portfolio

Whether or Not to Start a Business in Egypt

Breanna Wilkinson
May 4, 2017
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Table of Contents

I. Introduction to State Page 3-4


a. Overview of current regime
b. Characteristics of modern state
II. Explanation of theme Page 4-5
a. Why Chose
b. Overview
III. State Demographics and Markets Page 5-7
a. Demographic Trends
b. Role of State in the market
c. Imports/Exports/Trading partners
IV. Globalization and Economic Development Page 7-11
a. Globalization
b. Economy/Financials
V. Business Regulations/Practices and Governing Institutions Page 11-13
a. Key Business Regulations/Procedures
b. Starting a Business Rankings
c. Holidays/Hours/Customs/Etiquette
d. Minimum Wage
e. Work Visas
VI. Final Recommendation Page 13-14
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Introduction to State:
Egypt is an Arab located in Africa with Libya, Chad, Sudan, Israel, and the Gaza Strip.
The country links northeast Africa with the Middle East. The official language is Arabic. The
predominate religion is mostly Sunni Muslim. Most people think of corruption, the Nile River,
and ancient Egypt such as the pyramids when they think of the state. Egypt has three branches of
government like the United States (Executive, Legislative-Parliament, and Judicial-Three tiered)
but they function differently. The state is in crisis, including travel warnings which has a strong
impact on tourism and the economy. Read below to find out more about the State.

Overview of current regime:

Egypt is currently an authoritarian regime. Egypt has a long authoritarian history. An


authoritarian regime is one where the state is ruled by a single leader or small group of leaders.
These regimes tend to arise in weak states with weak formal institutions, states at the end of
colonialism and the desire to develop, and from failed attempts of transitions to a democracy.
President Hosni Mubarak was president from 1981 to 2011. During his time in office he
established a strong authoritarian regime. The government suppressed the media, and opposition
parties to make his party (National Democratic Party) dominate. Part of suppressing the media
involved President Mubarak appointing the editors of the newspapers. The National Democratic
Party made sure to gain the majority of votes during election time. Firms were being privatized
as a way to help the economy but the state remained the largest stakeholder. Big things such as
the national oil company, and the general authority for supply remained state owned. The regime
appointed officials at the University. The control even went as far as the religious staff at
mosques being appointed by the government (Schulz). Next in line was President Mohammed
Morsi who was arrested and tried in court by the belief to be conspiring to commit terrorist acts
with foreign groups. He was the first president to be democratically elected into office. President
Abdel Fattah al-Sisi came into office after having a part of forcing the previous president out.
Even though he over threw the democratically elected president the people of Egypt followed
him because they were all sick of the political turmoil that was going on in years previous
(Goldschimidt, Hopwood and Jones). President Sisi has a military backed government regime
currently. Egypt is currently facing lots of political and economic turmoil, which is leading to
massive corruption breakout (Adly).

Characteristics of modern state: (Orvis and Drogus).


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Territory Legitimacy
Founded in 1953 The state legitimacy is ranked as an
Age old dispute with Sudan over some land 8.4 for 2017 on the Fragile State
that is geographically known to be theirs Index.
(Halayeb) This means that they have a poor
More than 90% of Egypt is dessert land legitimacy ranking.
which accounts for why other countries do Low legitimacy can result in riots
not want their land against the government trying to force
Egypt has kept its border since 1960. The change (Fund For Peace).
State then changed from the United Arab
Republic with Syria to just Egypt.
Through history Egypt has claimed territory,
not lost it (Egypt-1960AD).
External and Internal Sovereignty Bureaucracy
Egypt is a member of the United Nations The Egyptian bureaucratic system
as of October 24, 1945. goes back to ancient times in
This means that the state is recognized as Egypt.
a state by other UN members. It is a key factor in Egyptian
Used to be under British control, and civilization.
used to be United Arab Republic (with
Syria). Now it is Arab Republic of Egypt
Have their own authority of the state
(Goldschimidt, Hopwood and Jones).

Strong, Weak, Failed: Egypt is on alert with an overall score of 90.2. The higher the score the
more failed a state is. Overall Egypt is 38th from the bottom out of 178, meaning the state is 140
behind the strongest state. The state ranks the worst on group grievance receiving a score of a 9.
The state also ranks low on fractionalized elites with an 8.8. The best ranking category is in
human flight with a score of 4.4 (Fund For Peace).

Explanation of theme:
You are an entrepreneur evaluating whether or not to start a business in Egypt.

Why Chose:

I chose this theme so that I could think about the project from a business standpoint. I feel
that the best way to look at the topic in a way that matches my education is to look at Egypt from
an entrepreneurial standpoint. This allows me to analyze the country from a political standpoint
and from a business stand point. This can help to learn all that is involved in deciding to open a
business internationally, even if the real thing is more complex than the facts Ill be covering. I
am not big on traveling the world, so looking at it from a tourist/relocation position would not
make sense for me. I also feel as though every country has its problems, and every country could
potentially have a rebellion if someone feels strongly enough to start it. Entrepreneurship makes
more sense for my overall education.

Overview:
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Included on page two is an outline of the topics that I will be using to evaluate whether or
not Egypt would be a good place to start a business. I will be addressing the topic by looking at
the market to analyze the kinds of goods and services the state provides, how their economy is,
and looking at who they import and export good with to better understand what I as a business
owner would need to produce/provide to have positive profits. I will also be looking at the effects
of globalization on the state and looking deeper into their economy by reviewing the type of
economy, their reform efforts, and if the authoritarian regime has had an impact on the economy.
The last piece I will be looking at the business aspect of the country including key business
regulations and procedures, customs, etiquette, and how employees are paid. In this section I will
also be looking at how the governing institutions of the state have an impact on business. By
looking at these factors I can then decide on whether it is a good idea or not to start a business in
Egypt. I have no specific business in mind. I am looking at the overall situation in Egypt and am
making a generalization based on that.

State Demographics and Markets:

It is important to look at the state demographics and markets to get an understanding


about the people of Egypt, and what the market is looking like to see if it is worth investment
into. For this I will be looking into the population, life expectancy, and about the layout of the
land to get a good sense of demographic trends to get a better grasp on target markets. I will also
be looking at the countries imports, exports, and trading partners to help determine what markets
are available, and where an entrepreneur would fit in with that. The role of the state in the
market can have a major impact depending on how regulations on made and enforced. To
determine the impact, I will be looking at economic policies and regulations that the country has
in place. Lastly I will be looking at the GDP, consumer spending, and the economic model to
look for growth, stabilization, or decline in the market. As an entrepreneur I would want to see
growth in the market and/or good trends to determine if starting a business in Egypt would even
be worth it. It can also be worthwhile to look at currency exchange rates to understand costs
associated with purchasing products from other countries, and selling products to other countries.
It can also serve as a basis to understand the value of money to countries Egypt imports and
exports from, and compared to bordering countries to see where the state ranks compared to
others.

Demographic Trends:
The population of Egypt as of July 2016 is 94,666,993. 25.2% of the population lives
below the poverty line. The labor force consists of 31.96 million people as of 2016, but yet
unemployment remains high. The current literacy rate in Egypt is 73.8%, with the expected
school life expectancy of thirteen years (Central Intelligence Agency). The life expectancy of the
people in Egypt is around 70 years old. Egypt has a primarily young population. One third of the
population is under age 15 in Egypt. Three fifths of the population are under age 30. Two fifths
of the population live in Urban areas. Most of the population lives among the banks of the Nile
River because it is where the most resources are. There are about 5000 Egyptian people per
square mile around the Nile River (Goldschimidt, Hopwood and Jones).
There is currently a travel warning for anyone wanting to go to Egypt that came into
effect December 23, 2016. There are several restricted areas in the country. Basically any
travelers/tourist are in the Cairo/Alexandria areas of Egypt. The borders are under military
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control. Because of all the crime and corruption there is heavy government presence at the major
tourist destinations and archaeological sites. Travel by vehicle is unsafe because Egypt has a high
rate of roadway fatalities. It is also unsafe to use public transportation and the metro (Passports
& International Travel- Egypt).
According to Freedom House scores on freedom in the world for 207, Egypt ranks as
being not free. Their net freedom status is also not free. For this scale a 100 is the most-free, and
0 is the least free. Egypt ranks 26/100 for their freedom score. The score can be broken down
into three categories: Freedom rating, political rights, and civil liberties. Egypt ranked a 5.5 out
of 7 for freedom ranking, 6/7 for political rights, and 6/7 for civil liberties. For the break down 7
is the least free, and 1 is the most-free. Political and Civil liberties can be broken down even
further.
Political Rights 9/40
Electoral Process 3/12
Political Pluralism and Participation 4/16
Functioning of Government 2/12
Civil Liberties 17/60
Freedom of Expression and Belief 5/16
Associational and Organizational Rights
Rule of Law 2/16
Personal Autonomy and Individual Rights 6/16
(Freedom in the World).
Role of State in the market:
The Egyptian government started implementing reform programs aimed at spurring the
economy in 2014. The first set of reforms had a focus of rebalancing the macroeconomic aspects
of the economy. Included in the reforms was the VAT law that reduced energy subsidies, the
liberation of the Egyptian pound from its dollar shortage, and containing the high growth of the
minimum wage bill. The second set of reforms aimed at improving governance and the
investment climate. Included in this is the Civil Service Reform Law passed in 2016 which aims
to organize the work, hiring, and salaries of the workers in the states administrative bodies. This
reform law hopefully can be better than the corrupt system that came before it. The government
also worked on reforms that would remove investment barriers to better attract local and foreign
investments. Examples of these are:
Investment Law- Providing more incentives for investors and having a better system
regarding any disputes.
Industrial Licensing Law- Simplifying the industrial licensing system by limiting the
scope down to five categories (health, safety, security, environment, land use). Aimed
to attract new investments
The reform programs are endorsed by the World Banks programmatic DPF series, the IMF
Extended Fund Facility (EFF) and the African Development Bank parallel financing. Some
Social policies are also being developed (Ease of Doing Business in Egypt, Arab Rep).

Imports/Exports/Trading partners:
Exports in Egypt in 2016 were worth $14.73 billion. That makes up one tenth of the
states GDP. Exports in Egypt in 2015 was higher than 2016 at $19.03 billion. Key partners for
exports are Saudi Arabia, Italy, Turkey, United States, United Kingdom, India, and the United
Arab Emirates (Central Intelligence Agency). of Exports from Egypt are petroleum, and
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petroleum products. Other major exports also include raw cotton, cotton yarn, and fabrics. Raw
materials, minerals, chemical products, and capital goods are also exported out of Egypt. There
are also some agricultural exports consisting of rice, onions, garlic, and citrus fruit
(Goldschimidt, Hopwood and Jones).
Imports in Egypt in 2016 were $50.07 billion. That makes up one third of the states GDP.
Imports in 2015 were higher than 2016 at $57.17 billion. Key partners for imports include China,
Germany, United States, Turkey, Russia, Italy, and Saudi Arabia (Central Intelligence Agency).
Two fifths of imports consist of raw materials, mineral and chemical products, and capital goods
such as machinery, electrical apparatuses, and transport equipment. One fifth of imports are food
products. The last two fifths of imports are other consumer goods (Goldschimidt, Hopwood and
Jones).

Analysis of Data:
From an entrepreneurial standpoint I can pinpoint what my target market would be if I
was to start a business in Egypt. My target market would be individuals between the ages of 15-
30 that live along the banks of the Nile River. This can also be the age group that I employ for
the business since a large number of this group are unemployed, which could help lower the
unemployment rate a little. I would probably revolve my business around raw cotton, cotton
yarn, and fabrics. This would best allow me to utilize one of Egypts exports, and create products
for both internal and international customers.
From this data I see some concerns, and some possibilities. My concerns for starting a
business in Egypt start with the percent of the population that lives below the poverty line. This
limits the ability that consumers have to pay for goods. One thing to consider when starting a
business in Egypt is are people in Egypt going to be able to help keep the business profitable. It
is not reasonable to rely solely on the international/global world to purchase my products to keep
the company going. Otherwise I could just start a business in the United States. I am also
concerned about the travel warning advisory and the impact that can have on business.
The other concern is that Egypt is ranked as not free. It is bad when the score for civil
liberties is so bad because it is important as an entrepreneur to have rights and to have a voice.
The rule of law is weak, there is a low freedom of expression and belief, and a low personal
autonomy and individual rights. As a person coming from the United States this could be a
challenging adjustment, and could make it hard to conduct business. My fear is that the state
would take over if I became profitable so that they could join in the glory. To give a little bit of
perspective from the same source, The United States rates a 1/7 for political rights and civil
liberties which is the best score to get. Overall they rank 89/100 compared to Egypt who is
26/100. This means that the two have a difference in rank by 63 points. That is a large stretch. I
would not want potential riots that break out from having no rights and such corruption to hurt
my business.
Egyptian officials have tried to make reforms to help the market but it seems more like an
attempt than anything. While some of the laws mentioned may make it easier to start a business,
it doesnt necessarily make it better for businesses to last or to be profitable. It is concerning that
Egypt is importing more than they are exporting. That gives them with a trade deficit, which can
have a negative impact on the economy. The imports account for a lot more of the states GDP
than the exports do. Overall the concerns are outweighing the entrepreneurial possibilities.

Globalization and Economic Development:


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Globalization can have a negative impact on a state, so it is important for me to look at


the impact that globalization has on Egypt. There are several debates towards the positives and
negatives of globalization. Too much of a negative impact from globalization on the state can be
harmful to business, especially to an entrepreneur who wants to start a business from Egypt but
is not from Egypt him/herself. It is also crucial to look at the economy. Failing economies are not
good for business. For my analysis of the economy in Egypt I will be looking at the type of
economy, any development outcomes, responses to recession, if there are any reform efforts, if
there are any continuing economic issues, and if there are any regime impacts on the economy.
This can be helpful to look for economic trends to see if a business could make it off the ground,
and if it could survive in the long run. Looking at the economics allows me to determine what
the quality of life for the community is like, what incomes for those community members is like
because of the economy, and if there is a trend of job creation, or job loss in the state.

Globalization
Globalization can create new opportunities, and allows countries to enter new markets
that they could not have access to in their home country. Globalization can be measured in a few
different ways: economic globalization, social globalization, and political globalization. The
KOF Globalization Index is a way to view the rankings of countries by these factors.

Economic Globalization Social Globalization Political Globalization


is based on: is based on : is based on:
Trade (% GDP) Telephone Traffic Embassies in
Foreign Direct Transfers (% GDP) Country
Investment (% GDP) International Tourism Membership in
Portfolio Investment Foreign Population (% International
(% GDP) Total Population) Organizations
Income Payments to International letters (per Participation in
Foreign Nationals (% capita) U.N. Security
GDP) Internet Users (per 100 Council Missions
Hidden Import Barriers people) International
Mean Tariff Rate Television (per 100 Treaties
Taxes on International people)
Trade (% Current Trade in newspapers (%
Revenue) GDP)
Capital Account Number of McDonalds
Restrictions Restaurants (per
100,000 people)
Number of IKEA (per
100,000 people)
Trade in books (%
GDP)
KOF. KOF Globalization Index. 2017. 2 May 2017. <http://globalization.kof.ethz.ch/>.

Index Type (2016) Ranking out of 207 Score


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Globalization Index: 66 62.71


Economic Globalization: 135 45.69
Social Globalization: 76 56.69
Political Globalization: 12 93.01
KOF. KOF Globalization Index. 2017. 2 May 2017. <http://globalization.kof.ethz.ch/>.

Economy
Egypt has an unstable and uncertain economy, although it is the second largest economy
in the Arab world after Saudi Arabia. A lot of that has to do with political turmoil, and the
struggle to support the growing population. The economy in Egypt relies on agriculture, and
tourism. With all the corruption and instability, tourism has been on a decline (Goldschimidt,
Hopwood and Jones).
During the Great Depression Egypt suffered greatly. In 2013 Egypt was going through
their hardest economic time since the Great Depression back in the 1930s. A lot had to do with
the fall of President Mubarak as mentioned earlier. This led to a devaluation of the Egyptian
pound, increasing unemployment, and a great fall in tourism revenues. Overall there was a 3%
drop in growth, and a 60% drop in their foreign exchange reserves (Kingsley).The crisis hit in
country hard, but hit the poorer people of the country even more. I mentioned earlier that 25% of
the population is living below the poverty line. Egypt seems to be counting more on a bailout
from other countries (Kingsley). In 2016 the inflation rate was 12.6%, which is 1.7% higher than
the previous year. That makes Egypt rank 209 out of 227 countries. (Central Intelligence
Agency).

GDP:
Egypt has a GDP official exchange rate in 2015 was $342.8 billion. The state has a GDP
per capita of $12,100 as of 2016. GDP per capita measures the total output of a country in
account of the GDP and dividing it by the number of people in the country. Looking at the per
capita GDP can be helpful in comparing Egypt to other countries. This makes them 125th out of
230 in the world. Their GDP purchasing power parity in 2016 was 1.105 trillion. This makes
them 23rd out of 230 in the world. This calculation is Egypts GDP at purchasing power parity is
the sum value of all goods and services produced in Egypt valued at prices prevailing in the
United States. Egypts GDP real growth rate was at 3.8% in 2016. This places them 65th in the
world out of 225. GDP real growth rate measures economic growth in relation to the GDP from
one period to another that is adjusted for inflation (Central Intelligence Agency).

Consumer Confidence:
Egypt has a consumer confidence index that is part of the Nielsen Global Survey of
Consumer Confidence and Spending Intentions. Consumer Confidence in Egypt has averaged
around 84.29 from 2007 until 2016. In the fourth quarter of 2016 consumer confidence decreased
by 6 from 70 to 64. Consumer spending was 722 in 2016. The bank lending rate in 2016 was at
16.50%. For this survey values above 100 indicate optimism and values below 100 indicate
pessimism. Consumer confidence is on the decline, and has been since 2012 (Egypt | Economic
Indicators).

Economic Model:
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Egypt had a neoliberalist economic model, however there is a fight back against it. It is believed
that neoliberalism is the cause of hunger, poverty, and inequality in Egypt. A lot of the rise
against neoliberalism in the state came at the end of Mubarak presidency. The state implemented
a series of neoliberal reforms that led by corruption (Military and police general run) ended up
hurting the state instead of helping the state. Privatization, market reforms for investment, and
increasing and diversifying exports caused an increase in poverty and unemployment.
Neoliberalism is now not working under Sisi Presidency, and the state is facing a continuance of
corruption, and negative economic effects (Naguib).

Currency Exchange Rates:


The strength or weakness of Egypts economy compared to other countries can be looked
at by looking at currency exchange rates. Currency can be affected by a variety of factors. Some
of those factors can include inflation, interest rates, and confidence in the government. Below is
a chart of exchange rates from some of the important countries, trading partners, and bordering
countries in comparison to the Egyptian exchange rate.
Currency Exchange Rates
Egyptian Pound (EGP) For Every 100 Other Country Value
Dollars
1 EGP= .0550055 US Dollars 100 EGP= $5.50 USD 1 USD= 18.1800 EGP
1 EGP= .0506611 Euros 100 EGP= $5.06 EUR I EUR= 19.7390 EGP
1 EGP= .0430130 British Pounds 100 EGP= $4.30 GBP 1 GBP= 23.2488 EGP
1 EGP= 3.54636 Indian Rupees 100 EGP= $354.63 INR 1 INR= .28197 EGP
1 EGP= .0727510 Australian Dollars 100 EGP= $7.27 AUD 1 AUD= 13.7455 EGP
1 EGP= .0727510 Canadian Dollars 100 EGP= $7.27 CAD 1 CAD= 13.4564 EGP
1 EGP= .361426 Sudanese Pounds 100 EGP= $36.14 SDG 1 SDG= 2.76682 EGP
1 EGP= .0753673 Libyan Dinars 100 EGP= $7.53 LYD 1 LYD= 13.2684 EGP
1 EGP= 33. 2134 Central African Francs 100 EGP= $3321.34 XOF 1 XOF= .0301083 EGP
1 EGP= .206303 Saudi Arabian Riyals 100 EGP= $20.63 SAR 1 SAR= 4.84723 EGP
1 EGP= .202021 Emirati Dirhams 100 EGP= $20.20 AED 1 AED= 4.94999 EGP
1 EGP= .197134 Turkish Liras 100 EGP= $19.71 TRY 1 TRY= 5.07268 EGP
1 EGP= .378913 Chinese Yuan Renminbis 100 EGP= $37.89 CNY 1 CNY= 2.63913 EGP
XE Currency Converter. 5 March 2017. 24 April 2017. <http://www.xe.com/currencyconverter/>.

Analysis of Data:
Overall it seems as though Egypt is globalized, but just a little. Overall the states
globalization rank is not bad, but it could be better. What strikes me the most is that the
economic globalization is a lot weaker than other areas of globalization. This leads me to believe
that my company would be stuck internally, and would not be a great international presence. In
the long run this means that my company could only grow so much. Egypt has a lot of desert
space that does not have a lot of infrastructure, meaning there are so many places in Egypt that
my company could expand to. With Egypt only being minimally globalized on the economic
spectrum, the reduces my changes to them turn the company international and extend my market
for which I sell goods.
Egypt cannot seem to get out of Economic hard times. Their economy is not good on
their own, let alone if there is a global recession. In order to start a business in a country, I would
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be looking for trends to see that the economy is on the rise if it was weak, and that they can work
through it in times of recession because recession is inevitable. I see a lot of decline in Egypt,
and I anticipate that it will only get worse from here. When looking at consumer confidence there
is a pessimistic view. If consumers are confident they wont spend as much, and if they dont
spend money it cannot go back into the economy to help boost the economy. I would want to see
optimism in consumer spending to ensure that I have customer ready, willing, and able to
purchase my products once my business got up and running. If consumers dont purchase goods
then I cannot maintain my business, and with not much going on internationally it is asking for
failure. Economic policies and reforms that are being put in place are hurting the state more than
helping it. I am not seeing any light at the end of the tunnel with that. When the economy is low,
the value of the currency is also low. $100 EGP will barely buy anything in another country,
especially in the United States. This could get tricky with importing and exporting. With travel
restrictions people cant leave the state with more than $10,000. This could be a challenge if I
wanted to leave the state and move my business, or to sell the business and move back to the US.

Business Regulations/Practices and Governing Institutions:

Exploring business regulations, practices, and governing institutions is an important part


in deciding on whether or not to start a business in a country other than in your home country.
The way business is conducted and the institutions ruling over businesses can vary country to
country. An entrepreneur must be aware of this, or there is a strong likelihood that the business
will not be successful or even fail. A level of comfort and with change, and personal beliefs can
also come into play for this. Entrepreneurs in this situation must be comfortable with how
business in conducted in Egypt, to ensure that he/she can comply. One would have to be willing
to conform with Egyptian business ways. To analyze this topic, I will be looking at Egyptian
holidays that impact business, the standard hours of business, customs and etiquette of business,
minimum wage laws, and the process of attaining work visas.

Key Business Regulations/Procedures:


There are some regulations/procedures that must be followed when it comes to business
needs. If a company wants a woman to work for the company, they must obtain her husbands
permission to leave the home. Working for a woman is a right and in most cases it is unlawful for
a woman to leave the house to keep her right to alimony. In order to reserve the company name a
business owner must obtain a certificate of non-confusion from the General Authority for Free
Zones and Investment. This includes the incorporation department checking the legality of the
company name. If passed, then the owner will go to the Commercial Registry Office to obtain
the certificate bearing the official government stamp. This process costs about $25 EGP. A
company must obtain a blank certificate from an authorized bank. A bank account must be
opened in order to get the certificate. The cost of this can range from $300-500 EGP. Official
documents must be submitted to the General Authority for Free Zones and Investment. These
documents include:
Original certificate of non-confusion
Original bank certificate of opening a bank with an authorized bank
Copy of the powers of attorney from the founders to their representative
Copy of the founders I.D. cards or passports
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Original certificate indicating that the companys auditor is listed at the registry of
accountants and auditors
The application provided by GAFI
Stamped articles of association (Central Intelligence Agency).
A company must also obtain a certificate of incorporation.

Starting a Business Rankings: According to the World Bank data

Topic 2017 Rank 2017 Points (%)


Overall 122 out of 190 56.64% out of 100%
Starting a Business 39 out of 190 92.43% out of 100%
Dealing with construction permits 64 out of 190 72.46% out of 100%
Getting electricity 88 out of 190 70.33% out of 100%
Registering Property 109 out of 190 58.30% out of 100%
Getting Credit 82 out of 190 50.00% out of 100%
Protecting Minority Investors 114 out of 190 48.33% out of 100%
Paying Taxes 162 out of 190 51.96% out of 100%
Trading Across Borders 168 out of 190 42.23% out of 100%
Enforcing Contracts 162 out of 190 40.90% out of 100%
Resolving Insolvency 109 out of 190 39.51% out of 100%
Ease of Doing Business in Egypt, Arab Rep. 2017. 24 April 2017. <http://www.doingbusiness.org/data/exploreeconomies/egypt>.

The rankings for each topic are out of 190 countries. The 2017 points (%) is the distance to
frontier score. It measures the distance of Egypts economy to the frontier, which represents
the best performance observed on each of the indicators across all economies. 100% is the
frontier and 0% is lowest performing. The orange indicates a strong score. For the ranking,
starting a business is in the top 20%. For the points ranking, starting a business is in the top 10%.
The yellow indicates weakness. For the 2017 rankings, the rankings are in the lower 57%-88% of
other countries. For the points ranking, those topics are in the lower 51%-60% of countries.

Holidays/Hours/Customs/Etiquette:
The regular work hours in Egypt are Sunday through Thursday 8:30am-3:00pm, although
some businesses are open until 4-4:30pm. Friday is the Muslim holy day. Egypt has eleven
public holidays that impact the work schedule, however there is no holiday compensation for
workers during these holidays. When setting meetings, it is important to keep track of Ramadan,
because the hours of operation are shortened slightly during that time (Santander).
The dress code is a modest one. Even in the hot desert temperatures, one must have their
body remain covered. Women are to make sure that they are dressed very modest and are not
showing off any parts of their body, including the heels on their shoes. This can entail dressing
more western (suit and tie) because dressing in traditional Egyptian clothing can be seen as
offensive to native Egyptians. If a man stares at a woman too much it means that she is not
dressed modest enough (Santander).
Business cards from companies in Egypt are expected to have one side written in Arabic
and one side written in English. For an outside company it is acceptable to have it written just in
English, although it would look better if the company went the extra side to add proper Arabic to
it (Santander).
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Minimum Wage:
Egypt increased its minimum wages in February of 2014 to 1200 EGP a month ($66.23
U.S. Dollars). Minimum wage in Egypt works differently than minimum wage in the United
States. Egypt is currently considering raising the minimum wage to 1500 EGP. Minimum wages
are determined by the National Council for Wages (Egypt | Economic Indicators).

Work Visas:
It can be important for a company to host business meetings and it can be necessary for
those individuals traveling to obtain visas. Also as an entrepreneur not from Egypt, this would
apply to that person as well. In order for someone to get a work visa, the employer must apply
for a work permit for that person. That visa must be obtained prior to travel. Egypt has
regulations on the company must prove and explain why they need someone from the outside to
work for them and not an Egyptian worker. People who come in with just tourist visas are not
allowed to work in a country. This can be okay if it is just a business meeting, but if the
entrepreneur plans on bringing some people from their home country to work it can get tricky.
Passports for those coming into the country must have an expiration date of at least six months
after the end date of the trip. There must also be a good number of pages in the passport for entry
stamps. Those that are staying in the country longer than thirty days need proof of a recent
negative aids test. This is a measure to try and prevent the spread of it in the country (Acevedo).

Analysis of Data:
The biggest worry about starting a business is the process that it takes. With all the
corruption going on in the state, it is more than likely to be asked to pay a bribe for something
that I shouldnt have to pay extra for, or pay for at all. It can serve as a bigger challenge to even
be granted the ability to start a business in Egypt with a skilled worker visa, and without being a
citizen. Overall the ranking for starting a business is good. That score would make me think that
hey, I can do this. Looking at the bigger picture of the rankings overall with starting a business,
it becomes more concerning. Trading across borders has a band ranking, which relates back to
weak globalization, and more imports than exports. I do have a problem with only mainly selling
my products to those in Egypt. It is also concerning that contracts are not enforced higher. This
could lead to a series of problems, and the potential to lose out on money, clients, suppliers, and
maybe even the business as a whole. I see a lot of corruption and uncertainty in this area.
In regards to time differences in some instances there would only be a short window of
time to conduct business internationally (if the business developed that far). I would have to
work even longer days to accommodate those in time zones behind Egypts such as the United
States. In order to conduct business before leaving I would have to contact professionals in the
United States as soon as they open. This would leave an estimated window of about 8am-9am
United States time to be done working for the day at 3pm. It would be a battle to be able to make
all the contacts that I need to during the proper hours that best suits the companies that I would
be working with from around the world.
Overall I think that the customers and etiquette are fair. The biggest concern is that I am a
woman and would be strictly and heavily scrutinized in Egypt for how I dress. Also how women
in Egypt need their husbands permission to work. I understand professionalism, but it is possible
to be professional and have parts of your arms showing (short sleeve shirt, or parts of your leg
(knee length skirt). Also if I was running a business there I would be living there. I think I would
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have a hard time fitting into overall culture there with how woman are treated. I do not think the
men would take me seriously, which would cause problems and would probably be one of the
quickest ways that the company would collapse (if it could even get started).

Final Recommendation:
My final recommendation is that as a female entrepreneur, I would not start a business in
Egypt. The biggest factors that I have mentioned earlier that are impacting this are 1. The view of
women in Egyptian society, 2. The economy and 3. The political instability and corruption. I am
a female in the 15-24 age group. That is the age group that has an unemployment rate of 34.3%
(Central Intelligence Agency). If it was so easy to start a business, I am sure someone in that
group would have done so. Then again those are probably the same group of people that
contribute to the 25.2% of the population living below the poverty line (Central Intelligence
Agency). Those make the odds stand against me from the start. I would struggle in this
environment because my goal in life is to thrive and be self-sufficient. I am also one that believes
that I do not need a man to be successful in life, even though someday Im sure I will marry. I
would have a hard time being a woman and an entrepreneur in Egypt, especially where the
ratings for civil liberties for people in Egypt are already unfree. Egypt ranks 26 out of 100 (100
best score) for freedom, making it an unfree state (Freedom in the World).
The economic side of the country is doing so poorly right now that it does not condone a
new business. Egypt is also considered an on alert state, being only thirty-eight spots from the
bottom compared to other countries. This makes the state a weak state. It is hard to get a new
business up and running. Egypt faces a constant economic struggle. In Egypt it would be a
challenge to get/keep a business on its feet when the economy is bad at the start. The fact that
there is such a low consumer confidence (rating of 64), is also a bad sign (Egypt | Economic
Indicators). As an entrepreneur I need people to want to buy my products, and be ready, willing,
and able to do so. With declines in the economy, and low consumer confidence in spending it is a
bad idea to start a business, or to even invest in business.
With the currency exchange rate being the way it is, and with the minimum wage is only
$66.23 United States dollars a month (Egypt | Economic Indicators). I do not imagine that it gets
people far financially. That makes labor cheaper than labor in the United States, but it raises an
ethical dilemma for me. The fact that the state is in a trade deficit (50.07 billion in imports and
14.73 billion in exports) means more money is being spent, than is earned (Goldschimidt,
Hopwood and Jones). This can just keep creating further issues for the state as time goes on.
With all factors considered, there will be no entrepreneurship in Egypt from myself.
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