Egypt gold mining boom comes with risks for investors

Significance

The government is prioritising expansion of the mining sector, including attracting foreign investment, after many years of neglect. However, the military's increasing dominance of parts of the economy, including the mining sector, creates risks, especially for foreign investors.

Impacts

• The Egyptian bureaucracy and lack of specialist service providers will create obstacles for private sector investors.
• There is no immediate prospect of a legal framework to govern business relations between the military and international mining companies.
• Investors will not face the same credit risk in the mining sector as operators in the petroleum sector face.