Egypt’s Stock Exchange is comprised of two exchanges, Cairo and Alexandria, both of which are governed by the same board of directors and share the same trading, clearing and settlement systems.
The Alexandria Stock Exchange was officially established in 1888, with Cairo following in 1903.
Both exchanges were very active in the 1940’s, and the combined Egyptian Stock Exchange ranked fifth in the world. The central planning and socialist policies adopted in the mid 1950’s led to the Stock Exchange’s dormancy between 1961 and 1992.
In the 1990’s, the Egyptian government’s restructuring and economic reform program resulted in the revival of the Egyptian stock market, and a major change in the organisation of the Cairo and Alexandria Stock Exchanges took place in January 1997 with the election of a new board of directors and the establishment of a number of board committees.
Under the chairman at that time, Sherif Raafat, the board of directors determined to modernise the Exchange. Steps taken since then have included
- creating a coherent organisation structure with clear division of authority and responsibilities
- deciding to install a new state-of-the-art trading, clearing and settling system conforming to international standards (In May 1998 a contract was signed with EFA Software Ltd., a Canadian company, to this end)
- developing new membership and trading rules, and arbitration and dispute resolution procedures
- Planning the improvement of the clearing, settlement and payment systems
By the end of November 1998, these efforts had started to bear fruit and there were 833 listed companies on the Egyptian Stock Exchange with a market capitalization of approximately L.E. 71.3 billion (up from 627 companies listed in 1991 with a market capitalization of L.E. 8.8 billion).
In the case of individuals, mutual funds and international funds, no taxes are levied on dividends, capital gain and interest on bonds. There is no stamp duty on securities. Profits of Egyptian corporations from investing in securities are subject to capital gains tax.