Wednesday 3rd December 2025
by inAfrika Newsroom
Egypt pharmaceutical manufacturing now sits at the centre of the country’s health, FX and industrial policy debates. The pharmaceutical market is worth around US$5 billion, with local manufacturers meeting roughly 90–91 percent of demand by volume through more than 120 plants. Yet Egypt still imports about US$3.5 billion in pharmaceutical products annually, including finished medicines and active ingredients, leaving the sector exposed to currency swings and global supply shocks. For bank CEOs and policymakers, the question is how to shift Egypt pharmaceutical manufacturing from import pressure to a true export engine.
The first reason is macro stability. Medicine imports worth US$3.52 billion in 2024 put continuous pressure on foreign exchange reserves. While local firms supply most of the units sold, they rely on imported raw materials for about 90 percent of their inputs. Any currency shock therefore feeds directly into production costs, retail prices and access to essential drugs.
The second reason is domestic capacity. Egypt’s pharmaceutical industry grew revenue by about 42 percent in 2024 compared to 2023, with locally made products covering 91 percent of local demand, according to recent government and IQVIA data. The sector is largely private, with local companies producing roughly three-quarters of output and multinationals the balance. That mix creates a base of experienced manufacturers that can move into higher-value segments if incentives, regulation and infrastructure align.
The third reason is regional opportunity. The Middle East and Africa pharmaceutical market could reach about US$75 billion by 2024 and almost double by 2034. Egypt’s population of over 100 million, central location and existing plants make it a natural candidate to become a regional hub for generics, vaccines and specialised medicines, especially into Africa and the Gulf.
Inside Egypt pharmaceutical manufacturing, three opportunity clusters stand out.
The first is localisation of inputs. Today, Egypt imports around US$1.8 billion in active ingredients and about US$600 million in finished medicines each year. Substituting even a fraction of those inputs with locally produced APIs and intermediates would save FX and create upstream industrial jobs. Specialised industrial parks near Cairo, Alexandria and the Suez Canal Economic Zone can host API plants, excipient producers and packaging manufacturers, supported by reliable power, water and effluent treatment.
The second is capacity expansion in high-demand therapeutic areas. Chronic diseases, oncology and biologics are driving prescription growth. Market research suggests the pharmaceutical manufacturing segment alone is valued at about US$1.5 billion in 2024, with a projected CAGR above 6 percent to 2030. Egyptian companies plan to invest around EGP 4 billion (about US$80 million) in new production lines this year, adding some 20 lines focused on advanced formulations. For banks and investors, these are tangible projects with clear demand signals.
The third is export-oriented industrial real estate and logistics. As firms scale, they will need GMP-compliant facilities, cold-chain warehouses and efficient links to ports. Alexandria and Port Said already handle significant pharma traffic; Ain Sokhna and SCZone sites are emerging as new logistics and manufacturing nodes. Well-structured pharma parks with shared utilities can reduce unit costs and make Egypt more competitive as a contract manufacturer for regional and global brands.
For banks, Egypt pharmaceutical manufacturing should move from generic corporate lending to tailored sector finance. Plants and parks are capital-intensive but generate predictable cashflows once contracts and registrations are in place. Seven- to ten-year loans, equipment leasing and working-capital lines tied to export contracts can match sector realities better than short-term overdrafts.
Credit committees need sector-specific risk lenses. Regulatory approvals, patent cliffs, quality standards and export-market access matter as much as collateral. Moreover, banks can support suppliers—packaging firms, logistics providers, cold-chain operators—whose fortunes track the sector but whose financing needs are smaller and more flexible.
Policymakers, meanwhile, should lock in a coherent localisation and export strategy. Current plans to reduce imports and boost local value are clear in principle but need stable execution. That includes transparent pricing rules, timely foreign-currency access for critical imports, and targeted incentives for API and high-tech facilities. Regulatory agencies can further support the shift by speeding up approvals for plants that meet international standards and by strengthening pharmacovigilance to protect market reputation.
Development partners and DFIs can catalyse the transition by backing shared infrastructure and first-mover projects. Blended finance for API parks, green manufacturing upgrades and quality-lab capacity would crowd in private capital. Technical assistance can focus on GMP standards, export registration in target markets and regional regulatory harmonisation, especially within the African Continental Free Trade Area.
Egypt pharmaceutical manufacturing will not eliminate a US$3.5 billion import bill overnight. Yet a sector already worth billions, with 90 percent local production by volume, has the ingredients to become a genuine export pillar. For decision-makers, the opportunity lies in treating pharma not just as a health cost, but as a strategic industry that can stabilise FX, create skilled jobs and anchor Egypt more firmly in the region’s industrial map.
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