The Ministry of Industry and Foreign Trade announced yesterday that it is working on new regulations for issuance of operating licenses for the steel and cement industries. According to Daily News Egypt the Minister Mounir Fakhry Abdel Nour, stated that he will discuss the issue with the cabinet later this week.
“The Ministry of Industry and Foreign Trade should have postponed studying issuing new licenses for steel and cement manufacturers until the energy issue has been solved,” head of the Chamber of Metallurgical Industries Mohamed Hanafy commented on the issue.
Most steel factories are operating almost 50 percent below their full capacity due to lack of energy supply, according to Hanafy. Foreign currency levels in Egypt is also an issue affecting manufacturers in Egypt.
“Currently, most of the development projects are in the study phase, therefore there is no need for new licenses,” Hanafy noted, stressing that the already-existing steel factories are covering the market needs; however, supply will need to increase to meet the demand boost that will happen once the New Capitol and other development projects.
The Egyptian government recently ceased all energy supply to manufacturers in Egypt, with the exception of six factories, in order to divert energy to electricity generation which requires 65 percent of Egypt’s natural gas production. A decision that was met with significant dismay.