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“Political and International Environment in Egypt'' Submitted To A GLOBAL COUNTRY STUDY REPORT ON “Political and International Environment in Egypt’’ Submitted to K.P.PATEL SCHOOL OF MANAGEMENT AND COMPUTER STUDIES, KAPDWANJ IN PARTTICAL FULFILLMENT OF THE REQUIREMENT OF THE AWARD FOR THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION IN Gujarat Technological University Submitted by Faculty Guide Mistry Mahammadirfan. A. 117240592008 Mr. Jignesh Gondaliya Patel Tejaskumar. N. 117240592013 Assistant Professor Patel Dhariniben. K. 117240592009 Patel Namrataben. D. 117240592016 Patel Pinkalkumar. D. 117240592021 Patel Bhavikaben .P 117240592022 MBA SEMESTER III K.P.PATEL SCHOOL OF MANAGEMENT AND COMPUTER STUDIES, KAPDWANJ Affiliated Gujarat Technological University Ahmedabad 2012 - 2013 STUDENT’S DECLARATION We Irfan, Tejas, Namrata, Dharini, Pinkal, Bhavika, hereby declare that the report for Global / Country report entitled “ political & international environment in Egypt ’’ is a result of our own work and our indebtedness to other work publications references if any have been duly acknowledged. Place: KAPADWANJ (signature) Date: Mistry Mahammadirfan Patel Tejas Patel Namrata Patel Dharini Patel Pinkal Patel Bhavika I. PREFACE Being an M.B.A student, it is necessary to prepare a global country report. Their object of practical training & knowledge is to develop atmosphere and all other business practices. The preparation of the whole report was a great opportunity for us to explore ourselves to the practical field. All analysis done by us regarding the EGYPT country could make us all confident enough & prove ourselves. We could come out of the bookish knowledge. Preparation of such type of report calls intellectual nourishment professional help and encouragement. Due to report, we are exposed to the method and practices being use in the field of applications. II. ACKNOWLEDGEMENT Every student owes a great deal to others and we are no exception because learning is a process which entails give and take, exchange of ideas and value addition through discussions. So it gives us immense pleasure to be able to express our gratitude to one and all who have contributed to the successful completion of our project with a great learning. First and foremost we would like to thank our project guide Mr. Jignesh Gondaliya. He gave us an in-depth knowledge of the working of the GCSR report and enhanced our understanding on its various aspects. His invaluable and significant guidelines improved our outlook and contributed in making our project a real learning experience. He also encouraged us to put in our best efforts and bring out the beat of our abilities. III. EXECUTIVE SUMMARY Egypt was the home of one of the most significant civilizations of the early Middle East and was of one of the earliest urban and educated societies. However, he is also severely criticize by others who point to his dogmatic style of law and the damage that the collective system cause to Egypt’s long-term development forecast. Many Egyptians hope to see a more self-governing political agreement emerge but severe economic difficulty mean that a more self-governing future any time quickly is not very likely. Islam is the officer religion of Egypt. About 88% of Egyptians are Muslims and in general Egyptians are quite secular. Despite unrest in recent years, Egypt's political state today is stable and a completely self-governing state is likely within the near future. Egypt was ruled by many countries before establish self-government and today it is run by a multi- party semi-presidential system where the executive power is divided between the leader and the prime minister, although in practice the president tends to hold a greater share of the power. Egypt was the first Arab state to establish political relations with the state of Israel, after the sign of the Egypt-Israel Peace Treaty. Egypt is a major power between other Arab states and has always played a significant role as a mediator in resolve disputes between various Arab nations as well as in the Israeli-Palestinian dispute. Egypt’s government, under President Umbrae, has work hard over the last three years to pick up the pace with regard to reform which aim to boost higher financial growth and reduce being without a job. The Egyptian Constitution provides for a strong executive. Authority is vested in an elected president who can appoint one or more vice presidents a prime minister and a cabinet. The president's term runs for 6 years. Egypt's legislative body the People's Assembly has 454 members--444 popularly elected and 10 appointed by the president. The constitution reserves 50% of the assembly seats for "workers and peasants." In March 2007 Umbra introduced several constitutional amendments that would increase presidential powers and more significantly ban any political parties based on religion race or ethnicity. The amendments were put to a popular referendum and despite low voter turnout and boycotts by opposition groups passed with 75.9% approval. Political factors data such as tax policy, labor law, environmental law, trade restrictions, and tariffs. A country’s tax system has a significant impact on business activities conducted in the country. These tax incentives in the form of a special tax treatment otherwise included in domestic tax law or purpose designed law (e.g. investment laws).Since 1971, Egypt has been providing investors, with many tax incentives regardless of the legal form of their business activities (i.e. corporate or unincorporated). In this structure of Egyptian tax system is direct versus indirect taxes, and investments tax incentives, particularly corporate tax incentives. Main changes to corporate income tax for Egypt: The corporate tax base by eliminating provisions for special tax treatment and introducing world wide income tax for residents; Specific rules incorporated of calculation asset depreciation for new law, over allowable depreciation claims there by increasing transparency and reducing the discretionary powers of tax officials; Establishment introduced to improve the certainty of tax rules governing foreign companies market ; Main changes in personal income tax for Egypt: The top marginal tax rate reduced from 32% to 20% of egypt; A personal annual allowance independent of social status and The personal tax base for broadened by introducing residence-based on foreign tax credits. In Egypt, Tax revenue collected by central government and tax payable by businesses structure. In this data for last years can be given that, in this data is different country for the India and Egypt. Egypt country camper on % of GDP in two years for the same and camper on India is lower GDP. Taxes payable by businesses in total tax rate is Egypt 43.6 and India 61.8.In this condition for this two country in more tax payable on India and Egypt is lower tax payable of central government. The Egypt labor law no. 12 from 2003 is the one who regulate the labor market of Egypt. This new labor law has 257 articles regarding the legal aspects that regular the Egypt’s labor market condition. The contracts of employment must be in on paper in the Arab language and in 3 copies. Each of the copies must be kept by the employee, the social insurance and the employer. The Egypt labor law obliges the employers from the private sector to employ 5% from the total number of people with disabilities at the Manpower Offices` offer. A fixed contract has a period of maximum 5 years; in case that the owner and the worker want a longer period of service, the worker has the right of terminate the contract later then the 5 years but with no getting return. But the owner must be notified with the most 3 months before. The labor contract must specify the trial period; no employee must be kept in the try-out period more than maximum 3 months. In this charts data can be a Egypt labor force. Egypt labor force data years to years change their. Labor force in Egypt country can be in increase firm of their. Environmental issues in Egypt are governed by Law No. 4 of 1994. This law provide for the formation of an agency for the security and help of the environment, the Environment Affairs Agency (EEAA). Ships of any people off shore platform and any other company or agencies official to look at or use natural marine resources are permissible to discharge into the protective sea of Egypt any polluting substance resulting in harm to the water environment. The Egyptian government has developed a five-year environmental action plan (1997/98-2001/02) for violent the country's solid waste, air and water pollution problems. The stock of U.S. strange direct investment (FDI) in Egypt at the end of 1999 was $2.2 billion, an increase of 8.7 percent from 1998. U.S. FDI in Egypt is strong largely in the oil, developed, and banking sectors. Egypt has margins for most services sectors in which it has made General Agreement on Trade in Services. These margins place a 49 percent limit on foreign equity in structure and transport services. Foreign firms may own up to 100 percent of Egypt private insurance firms. Investors acquire more than a 10 percent stake in an insurance company require support from the Egyptian Insurance managerial Authority (EISA). A 2008 change to the insurance law made EISA more self-governing and strengthen its role from organizational regulator to a risk-based and market-sensitive controller. No foreign bank seeking to set up a new bank in Egypt has been able to get a license in the past 20 years, and in November 2009, the Central Bank Governor reaffirmed that no new banks would be given license. However, efforts to reform the long-term three state-owned banks have been mixed, and the Central Bank rejected privatization for the three banks in 2009 on the grounds that market situation were not right.
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