Egypt is stepping up efforts to support its homegrown startups, in line with Vision 2030’s focus on innovation and export-led growth as pillars of long-term economic development.

In recent years, a series of initiatives, policy reforms, and support programs have been launched to strengthen its startup landscape and create a solid launchpad for emerging companies. 

The General Authority for Investment and Free Zones (GAFI) is developing a new initiative to help Egyptian startups enter foreign markets and secure better financing. Hossam Heiba, CEO of GAFI, said that the initiative will coordinate among key stakeholders, study international best practices for adoption locally, and work with regional partners to open doors for Egyptian companies abroad. 

This year, authorities rolled out fiscal incentives, including tax breaks for businesses earning under $423,000 (EGP 20 million), alongside a stimulus package designed to improve financing conditions and overall competitiveness for startups and small enterprises.

In 2024, the government launched the EME Incubation Program, focused on developing innovation hubs in second-tier cities through grants, loans, and investment to build tech parks and nurture entrepreneurship ecosystems.

In 2023, Egypt established the Egypt Entrepreneurship and Innovation Center (EEIC) to support startup growth and help local entrepreneurs integrate into global value chains by providing a more robust and innovation-driven business environment.

Despite ongoing initiatives to strengthen the country’s startup sector, many still struggle to scale internationally — constrained by economic volatility, regulatory hurdles, and trade-related challenges at home.

IMPACT IS LIMITED

Amr Kawashti, Co-Founder and Managing Partner of In Your Shoe, says some of the country’s programs are helping startups gain exposure and access, especially those that offer networking or soft-landing support in other markets. “But the impact is still limited unless founders have their own drive and networks.”

“These initiatives still need to be more dynamic and better calibrated to fit different business sizes because what works for a tech startup might not work for a fashion brand.”

He explains that the support frameworks often take a one-size-fits-all approach. Tailored pathways, whether in financing, export facilitation, logistics support, or regulatory flexibility, are essential to ensure that different sectors can scale effectively. 

Farah El Nahlawi, Research Manager at MAGNiTT, notes that while Egypt’s newly launched initiatives may help startups expand internationally, their impact will take time to materialize — and will likely vary across companies.

“Some initiatives supporting the process are market-access programs, trade missions, and incubator partnerships, which create concrete introductions to partners, pilot customers, and follow-on investors abroad, something that matters a lot for first export deals and proof-of-concept outside Egypt.”

She adds that government-backed programs are also helping boost visibility, raising the profile of Egyptian startups and attracting interest from regional corporates and venture investors.

“On the other hand, many programs are at an intermediate stage in the scale-up process and don’t yet provide sustained capital or operational support for full international expansion (sales teams, local incorporation, compliance).”

The lack of tailored support remains challenging, as startups across different industries have varying needs.

“The initiatives are necessary and helpful, especially for market entry and visibility, but they are not yet sufficient to drive large numbers of startups to scale internationally without complementary reforms,” says El Nahlawi.

STRUCTURAL HURDLES

Egyptian startups continue to grapple with significant hurdles, led by prolonged economic instability following the shocks of 2022–2024, which reshaped the country’s business landscape.

The Egyptian pound dropped from roughly 15 EGP/USD in March 2022 to 48–50 EGP/USD by March 2024, before stabilizing near 47.22 as of October 30. The steep depreciation halved consumer purchasing power and slashed dollar-denominated startup valuations. 

Inflation surged in parallel, peaking at 37.3% between July and September 2023, with food inflation reaching 68.2%. Although inflation eased to 11.7% by September 2025, businesses endured more than 18 months of extreme volatility. For companies reliant on imported inputs, costs doubled, prompting some startups to shift headquarters to the GCC or pursue foreign revenue streams out of necessity.

Bureaucracy remains a serious obstacle. Regulatory barriers compound these pressures. Egypt has accelerated reforms — cutting business registration time from 42 days to 11 and reducing industrial licensing from 320 days to 28 — yet startups still face extensive bureaucratic friction.

“It slows down everything, from registering a company to moving money around,” says Kawashti. “Customs bureaucracy, in particular, is a huge issue for businesses that rely on importing raw materials or components. It delays production and kills efficiency. Currency issues and funding are critical too.”

Import-export rules add further burden. Under Decree 43/2016, foreign manufacturers in more than ten sectors, including textiles, electronics, and building materials, must pre-register products before shipping to Egypt. Customs clearance typically takes 8–9 days, but can exceed 20 days when GOEIC approval is required. 

Documents must be legalized through multiple agencies, from chambers of commerce to the Egyptian Embassy, then translated into Arabic, adding thousands of dollars per shipment.

EGYPT’S POSITION IN THE REGION

As new initiatives aim to support the expansion of Egypt-based startups, questions remain over whether these businesses can compete regionally against peers in more mature markets like the UAE and Saudi Arabia.

“We’re definitely competing, Egyptian startups have the skillset, creativity, and talent to stand next to players from the UAE or Saudi Arabia,” Kawashti says. “But if we want to lead, we must calibrate some outdated rules. If the government listened to founders from across different sectors and built policies based on their realities, Egypt could take over the region in many sectors.”

El Nahlawi notes it is difficult to make a “clear-cut assessment,” as Egypt-based startups operate within a different context. She points out that the UAE has built its venture ecosystem over the past decade. Saudi Arabia has accelerated over the past eight years through sovereign initiatives and strategic investment vehicles. 

Both markets have benefited from strong government support, corporate venture activity, and advanced regulatory frameworks, helping attract later-stage investors and global capital.

By contrast, Egypt’s ecosystem is younger, with peak activity between 2018 and 2022, when funding reached $812 million across 168 deals. Since then, macroeconomic pressures have slowed momentum, with total funding falling below $500 million between 2023 and 2025 YTD and annual deal counts dropping under 100, even as GCC activity remained more resilient.

“That said, Egypt remains one of the most dynamic early-stage markets in MENA,” she says, citing strong talent, a large consumer base, and a vibrant accelerator landscape. 

“Ultimately, Egypt-based startups can compete regionally when they leverage their cost efficiency, technical talent, and local market-testing advantage, but sustained competitiveness will depend on strengthening growth-stage capital access, streamlining regulations, and building cross-border investor connectivity,” she adds.

THE WAY FORWARD

Multiple factors are needed to drive the growth of the Egyptian ecosystem and help transform local success stories into global players. 

“These include, but are not constrained to, capital and liquidity, whereby the ecosystem grows a continuum of funding, including more mid-stage funds, anchor institutional LPs, and the attraction of international capital,” says El Nahlawi. 

“The country needs to ensure implementation of startup-friendly regulations (sandbox, clearer tax/tariff rules) and improve exit avenues, among other actions,” she adds.

Kawashti says it’s a mix of mindset and support. “Founders need to stop building for ‘Egypt only’ and think regionally or globally from day one. But we also need better access to strong networks, real connections, and mentors who’ve done it before and less fear of failure.”