Kamel Saleh, CEO of SBA - Grant Thornton, a member firm of Grant Thornton International Ltd (GTIL) and a leading independent professional service firm in Egypt, shared invaluable expertise at the Enterprise Finance Forum this week.
In a compelling panel discussion moderated by Bahaa Alieldean, senior and managing partner at Alieldean Weshahi & Partners, Saleh, together with Lamyaa Gadelhak of Baker McKenzie and Said Hanafi of MHR & Partners in association with White & Case, imparted strategic insights into how professional services help investors navigate a turbulent market.
Egypt has continued to face numerous challenges, from foreign currency crunches to global market volatility, a climate that local professional service businesses such as SBA – Grant Thornton, which has been in the market for over 70 years, is adept at navigating.
“When clients come to us, they are more concerned about the uncertainty than we are. We’ve seen the ups and downs, and we know how the recovery can happen and how things can turn around,” Saleh said. “The fundamentals are there for the economy, so our role as advisors in general is to give a calming message that this volatility or this uncertainty is not the end of the world.”
Professional service professionals are often the gateway through which local and international investors explore the market, providing assurance and services for clients looking to navigate regulatory complexities and drive maximum value for their organizations. From mitigating risks to managing tax strategy, professional service firms can be the lynchpin of investment decisions for both new entrants to the market and legacy players looking to make bold moves.
With numerous regulatory and policy reforms in the works to improve the ease of doing business, attract investment and position Egypt as a regional trade hub, there remains significant upside in the market. The government recently rolled out tax reform amendments designed to keep pace with the consistent development of worldwide international tax changes. And while implementation has its challenges, new tax reforms aligned with global benchmarks open the door for Egypt to enhance its investment climate, bolster tax equity and drive overall economic growth.
“Investors have negative views about the Egyptian tax system and tax policy,” Saleh added, pointing to the need for tax reforms, namely ones “rooted in communication and addressing issues quickly which would reduce one of the biggest impediments to investors,” added Saleh.
SBA – Grant Thornton’s tax practice takes a holistic approach to tax advisory that goes beyond reporting, helping clients flesh out a comprehensive strategy and approach based on the firm’s deep knowledge of the local market combined with global access of the wider Grant Thornton network.
With over 2,000 active companies, the startup ecosystem in Egypt fosters a culture of innovation and competition, creating an encouraging environment for promising ventures. However, without principled advisory, not only is raising capital for these players an issue but navigating complex tax terrains and risks can be challenging, whether locally or when they consider growth abroad.
“We have the ideas, the talent pool, and the economy that supports and makes smaller companies and startups successful, but when it comes to raising capital, the venture capitalists and investors advise them to leave Egypt and start setting up outside Egypt. Startups should keep operations in Egypt but have their holding company outside Egypt, where funds are raised and where further investments happen,” said Saleh
SBA – Grant Thornton has long advised venture capital players, incubators, accelerators as well as governments and NGOs on promoting new startups. More recently, the firm developed a multidisciplinary approach designed to provide financial, risk and tax advisory and training services for local entrepreneurs, ensuring they have the tools they need to mitigate risks, grow sustainably and contribute to wider economic development.
Whether it’s startups or individual talents, talent migration has been a concern for much of Egypt’s modern history.
“Every time there’s devaluation, there’s a brain drain, and people leave the country,” Saleh said, explaining that professional service firms accept it’s part of the business. “We hire large numbers of people and invest in their training because we know that the turnover rate will be high, after which they will have the choice between working locally or exporting their professional services to a different market.”
In 2023, SBA – Grant Thornton invested heavily in training and development as part of its efforts to attract and retain top talent. From audit, tax, financial and risk advisory as well technology advisory, the firm has plans to expand its training programs for both new professionals and seasoned experts as it works to upskill not only its own employees but the local talent market.
At the same time, brain gain is often the other side of the coin, “Even if the employees eventually leave due to competitive compensation in the Gulf, it ultimately comes back full circle when they return as clients,” Saleh added.
