Prime Minister Mostafa Madbouly recently reviewed a report submitted by Mohamed Farid, Chairperson of the Financial Regulatory Authority (FRA), regarding the latest developments in gold investment funds. These funds offer non-traditional investment opportunities for Egyptian citizens, allowing them to preserve the value of their savings while transforming gold from a mere commodity into a viable investment tool.

Key points from the report:

  • Fund Launches:
    • The first Egyptian gold investment fund, “EZ Gold,” was launched by Azimut Company in May 2023.
    • A second fund, the Beltone Evolve Gold Investment Fund (Sabayek), followed in January 2024.
    • The National Bank of Egypt is currently exploring the possibility of launching a third fund.
  • Investment Approach:
    • These funds directly invest in physical gold bars.
    • They track the document value and gold price/index announced by the Egyptian Exchange.
  • Investor Participation:
    • As of April 2024, a total of 108,808 customers have joined the two gold investment funds.
    • The “EZ Gold” fund, managed by Azimut Egypt for Fund and Portfolio Management, allows a minimum initial subscription of 100 documents at EGP 10. Investors can redeem their investments in the form of gold or cash.
  • Subscription Process:
    • Contracts for purchasing documents are made through designated bodies, including 10 specialized companies in securities trading, portfolio management, and fund management.
    • Recently, two additional entities were added to receive subscriptions, bringing the total number of companies to 12.
  • Expanding Investor Base:
    • The Beltone Evolve Gold Investment Fund (Sabayek) began its subscription process on 14 January 2024.
    • Work is underway to add three more entities to receive subscriptions, further expanding the investor base.

The government’s commitment to the success of these gold investment funds underscores their importance in Egypt’s financial landscape. By providing transparency, ease of access, and regulatory oversight, these funds empower citizens to participate in the gold market effectively.

Concerning the legal framework for minerals funds, Farid affirmed the keenness of the Financial Regulatory Authority to tighten the supervisory process on minerals funds, within the framework of its role in protecting dealers and market stability, reviewing the most important laws and decisions in this regard, including the Capital Market Law No. 95 of 1992, and several decisions issued by the Board of Directors of the Authority, including decision No. 71 of 2021 regarding the controls for dealing with investment funds in minerals as one of the transferable financial values, decision No. 50 of 2023 regarding the establishment of a register to register specialized service providers in minerals, decision No. 51 of 2023 regarding the controls for registration and cancellation of a service provider for custody of minerals, and decision No. 52 of 2023 regarding the controls for registration and cancellation of entities dealing with minerals in buying and selling.

Farid explained that these decisions include the conditions and experiences that must be met by the entities to be accepted for registration in the register of service providers, which enables the Authority to carry out its supervisory role over these entities regarding the services they provide to these funds.

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