The 25th January Revolution was a response to several grievances of the Egyptian people, one of which was the pervasive corruption. The full repercussions of the revolution are still to be felt, but as of February 2011, several former minister's from Mubarak's regime have been arrested. Prior to the revolution there was a key focus on market reforms and the establishment of free-trade and industrial zones, Egypt attracted an unprecedented amount of foreign direct investment and achieved high GDP growth in recent years. However, companies wishing to invest in the country should be aware that several sources identify pervasive corruption as a major obstacle to doing business. Observers agree that corruption in Egypt is pervasive and that the use of wasta ('mediation' or 'influence' in Arabic) is essential for doing business.

Positive developments in relation to corruption and investment:

• The corrupt regime of former President Hosni Mubarak has been toppled. Although, Egypt is currently ruled by the army, there is a very real prospect of free elections and a civilian government planned to start in November 2011 up until March 2012 where members of both houses of parliament and the President are to be elected.
• Egypt has dramatically improved its performance in a number of regulatory areas, including starting a company and trading across borders, areas in which Egypt performs impressively compared to regional averages.
• Although facilitation payments are often still required, Egypt has improved its performance in relation to issuing licences, permits and utility connections.

Risks of corruption:

• The revolution has created a power vacuum, and a future government will have to prevent this being filled with new corrupt individuals pursuing their own agenda.
• Companies are likely to encounter corruption in meetings with public officials. Officials in various government departments are known for bribery, embezzlement and tampering with official documents.
• Corruption and bribery are reportedly common when companies deal with public services, customs and taxes, public utilities and procurement.