Italian Cooperation in Egypt

Development Cooperation Projects

Integrated support to the Egyptian Small and Medium Enterprises

Geographic Area: Entire Egypt

Area of Development: Support to the economic and productive system

Sector: Development of Small and Medium Enterprises (SMEs)

Executive body: United Nation Industrial Development Organization– Italian Investment Promotion Unit (UNIDO – IIPU)

Institutional counterpart: General Authority for Foreign Investments (GAFI)

Other Funding parties: -

Beneficiaries: Egyptian and Italian-Egyptian Small and Medium Enterprises (SMEs)

Period of implementation: 1998 - 2009

Amount and nature of the funds: Bilateral channel. 17,043,077 € [soft loan and grant]

Type of intervention: Technical and financial assistance

Objective: Strengthening SMEs through cooperation with Italian enterprises, increasing production and job opportunities

Description of the project:

The project aims at providing technical assistance to Small and Medium Enterprises through:

(I) The preparation of industrial Business Plan;

(II) The promotion of industrial projects and the identification of potential Italian partners;

(III) The assistance in the preparation, formulation and negotiation of Joint Ventures and other forms of industrial cooperation;

(IV) Analysis of technical-financial feasibility and the identification of resources for funding;

The financial assistance is provided through a Line of Credit made available by the Italian Government and managed by the Egyptian banking system for the purchase of Italian made machinary for the industrial production. Technical assistance and training courses are provided for obtaining industrial patents. A new line of credit of 45,000,000 € is in the phase of negotiations.

The programme of integrated Support to Egyptian SMEs is an initiative undertaken by the Italian Government and the General Authority for Free Zones and Investments (GAFI), in the aim of sustaining the development of local SMEs through the cooperation with Italian enterprises. The United Nations Industrial Development Organization (UNIDO) was in charge of operating the programme.

The IIPU is found in the GAFI, the counterpart office, Down Town, Sherif St. No. 30. The IIPU provides support to SMEs in terms of technical and financial assistance.

At the enterprise level, technical assistance will be provided through:

1. Preparation of industrial Business Plans,

2. Promotion of industrial projects and identification of possible Italian partners, Assistance in the preparation, formulation and negotiation of Join Ventures and other forms of industrial cooperation,

3. Analysis of technical-financial feasibility, identification of resources for the finance.

At the institutional level, a support to the GAFI initiative in the activities related to the development and support of SMEs will be provided. Moreover, some events for the promotion of industrial development will be organized in coordination with banks and industrial institutions and associations.

The financial assistance is provided through a Credit Line made available by the Italian Government and managed by the Egyptian banking system for obtaining machinery of Italian origin for industrial production, for technical assistance and training and for obtaining industrial patents.

The priorities of the programme revolve around the following points:

• Equity Joint Ventures
• Technology Upgrading
• Technology Innovation
• Employment Generation
• Clean Production

The conditions of finance are regulated according to the following terms:

Conditions:

• The maximum and minimum fundable amounts are 1.8 M€ and 155,000 € respectively.
• A maximum amount of 20% of the loan value can be used in local expenditure on products of Egyptian origin included in the contract.
• The proposals have to be presented to the Cairo IIPU office by an Egyptian enterprise, along with a preliminary study of the initiative.

Main activities:

• Identification of new industrial partners, both Italian and Egyptian and evaluation of the proposals through the IIPU staff in Cairo and the delegate of GAFI in the UNIDO offices in Bologna.
• Ad-hoc technical assistance to Italian and Egyptian enterprises provided by a pool of Italian technical and financial experts.
• Arranging bilateral meetings between Italian and Egyptian entrepreneurs for investment initiatives.
• Preparation of ad-hoc sectorial industrial studies for the identification of potential development areas.

References:

Dr. Marco Potecchi

Head of UNIDO IPU egypt

Tel.: +2.02.22633952

Fax.: +2.02.22633465

m.potecchi@unido.org

www.unido.org

http://mediterraneanexchange.unido.org

UNIDO IPU Egypt

c/o Ministry of Investment Building

Salah Salem Str.

Cairo - Egypt

***

Dr. Sara Berlese
Development Cooperation Office-Italian Embassy
Tel.: 002 02 27920873/4
Fax.: 002 02 27956904