The diversity of the AAAID’s investments and its geographical spread across 12 Arab countries place the Authority in a position of strength. Moreover, the AAAID has enriched its experience through diversified investments in various economic and agricultural climates. It also continuously monitors and evaluates the performance of its existing and under-establishment companies in order to examine their operations and activities and to provide them with the support they require to achieve their investment plans and improve their performance. In addressing any challenges, the AAAID engages with its companies to exchange views and provide support in developing effective strategies within a framework of professionalism, good governance and transparency. Therefore, partnerships with the AAAID offer astute and promising commercial opportunities that aim to optimize returns.
The Arab member states encourage the development of the agricultural sector by offering investment incentives, granting advantages and concessions, supporting infrastructure development in project areas and creating a generally conducive investment climate. AAAID constitutive and investment agreements are signed by the 21 Arab member states and grant any company, established or co-established by the AAAID with at least 25% ownership of its capital, the right to the concessions laid out in such agreements. Some of these concessions are listed below:
Exempting the operations of AAAID affiliate companies from all custom duties and similar tariffs on all its imports and exports
Providing support for all administrative procedures required for the proper discharge of the work of the AAAID and its affiliate companies
Consulting with member states regarding the legislations, systems and administrative directives necessary for the work of the Authority and its companies
Providing administrative support to activate the investment plans of the AAAID and member states to ensure project implementation
Taking the steps necessary to enable the acquisition and utilization of lands, the rights thereof and any other rights by AAAID affiliate companies
Exempting the capital and profits generated by the investments of AAAID companies from any current or future taxes and fees
Exempting AAAID affiliate companies from international monetary constraints and transfer regulations, including the transfer of funds and shareholder's profits
Exempting the AAAID from all forms of current or future taxes and fees that are normally required in the member states
Granting employees of the AAAID and AAAID affiliate companies the necessary residence permits and work licenses, in accordance with the laws of the member states
The Arab world has immense agricultural potential, however, agriculture only represents 6.24% of the total GDP of all the Arab countries combined. Although their arable lands are spread over an area of 1345.28 million hectares, only 5.38% of this land is actually utilized. The agricultural labor force is estimated at 29.76 million people.
The high domestic demand on basic food products is satisfied with imported products, with a growing food gap estimated at USD 33.58 billion of which grains represent 54.5%, meat 19.4%, vegetable oils 9.3%, dairy products 10.1% and sugar 7.9%. These figures are indicative of the existence of promising investment opportunities in the Arab countries.
Criteria for project selection have been defined by the AAAID’s strategy as follows:
Project should be in line with the AAAID’s objective of producing basic food products
Project should utilize integrated technologies and broaden agriculture experiences
A comprehensive technical, financial and economic feasibility study should be available for the project
Investment cost of the project should be no less than USD 20 million
The project’s internal rate of return (IRR) should be no less than 12.5%, considering the levels of risk and return
Project should integrate agricultural production and processing in one or more member states
Serious shareholders with sound solvency positions should be available
Feasibility study should include disassociation procedures
AAAID’s contribution must be between 25-49% of the total equity capital of the project
Equity should be between 40-60% of total investment cost
Project should be in line with the AAAID’s objective of producing basic food products
Project should integrate agricultural production and processing in one member state or among various member states
Project should utilize integrated technologies and broaden agriculture experiences
Serious shareholders with sound solvency positions should be available
A comprehensive technical, financial and economic feasibility study should be available for the project
Feasibility study should include disassociation procedures
Investment cost of the project should be no less than USD 20 million
AAAID’s contribution must be between 25% - 49% of the total equity capital of the project
The project’s internal rate of return (IRR) should be no less than 12.5%, taking into consideration the levels of risk and return in the relevant country
Equity should be between 40-60% of total investment cost
Opportunities offered by the AAAID range from investments in existing companies to investments in those still under establishment, so investment funds may be used for either the expansion, development, rehabilitation or restart of current AAAID companies, or as capital for the AAAID’s under-establishment companies. Investment opportunities at the AAAID are categorized as follows:
Investment opportunities in AAAID existing companies, aimed at increasing production capacity
Investment opportunities in AAAID existing companies, aiming at expanding activities
Investment opportunities aimed at full utilization of companies’ available production capacities
Investment opportunities aimed at adding new production lines to diversify or increase production
Investment opportunities aimed at rehabilitating struggling or failed companies
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