With an estimated population of 100 million people, Egypt is the most populous country the Middle East and the third-most populous in Africa. Egypt’s Gross Domestic Product was worth USD 235.37 billion in 2017 and the country had a growth rate of 4.2 percent the same year (World Bank 2018). Development challenges include generating sufficient labour market growth to meet the job needs of a large and growing population, high overall unemployment and sustained high inflation, which has significantly eroded household purchasing power.

The Government of Egypt has recognized these challenges and set ambitious development targets to reach through the reform programme Sustainable Development Strategy Egypt Vision 2030 with pillars on economic development, social justice, knowledge and innovation. In implementing the SDGs Government of Egypt has embarked on major economic reforms to restore macroeconomic stability and promote growth. Reforms aim to reduce unemployment and improve the business and investment climate. Signs are encouraging with a growth forecast of 5% in 2018, rising to 5.8% in 2020 (World Bank 2018) and a gradual lowering of the unemployment level.

In October 2018, Egypt was announced as a new PCP country, the second such programme in the Arab region after Morocco. The PCP will support Egypt in advancing inclusive and sustainable industrial development in line with its national policies and development strategies, building on UNIDO’s long-standing technical cooperation portfolio in the country.

The PCP will help the Government of Egypt to achieve the goals of its Vision 2030, which aims at developing a competitive, balanced and diversified economy, based on innovation and knowledge, inclusiveness, and a collaborative eco-system. The programme will support the implementation of the national Industry and Trade Development Strategy 2016-2020, which seeks to increase the share of manufacturing value added from 18% to 21% of the gross domestic product (GDP).

UNIDO and the Government initiated the programming phase in 2019. UNIDO conducted a country diagnostic to help identify the main opportunities and bottlenecks for advancing industrialization in the country, and support the design and development of the PCP.

The PCP was formulated and will be implemented as a multi-stakeholder partnership with development partners, UN agencies, financial institutions and the business sector, under the overall leadership of the Egyptian Government.

PCP Egypt will focus on several priority industrial sectors and areas, namely: (i) Industrial policy; (ii) Investment promotion; (iii) Green industry; (iv) Smart cities and sustainable industrial parks; (v) Value chains; and (vi) Mainstreaming industry 4.0.

The sectoral priorities of the PCP include food, textiles and leather, furniture and handicrafts, chemicals, and electronics.

The PCP will support the achievement of the national targets of “Vision 2030”, focusing in particular on the economic development pillar:

• Manufacturing growth rate (10% by 2030)
• Manufacturing value added as percentage of GDP (18% by 2030)
• High technology exports as percentage of Egyptian manufacturing exports (6% by 2030)
• High technology exports as percentage of manufacturing exports (6% by 2030)
• Balance of the current account as percentage of GDP (from -3.7% in 2015 to 1% in 2030)