Monday 21 December 2020
Last update on Monday, December 21, 2020 At 3:59 PM
Since 2016, Egypt has embarked on major reforms to restore the image of its economy affected by several years of crisis. Thus, to strengthen the development of the private sector, the State has increased in recent years the announcements of partial or total privatization of public companies.
Egypt will sell three of its military-owned companies by 2021. That’s what Ayman Soliman, chief executive of the Egyptian sovereign wealth fund, announced this week.
This operation is part of the Egyptian government’s strategy to privatize many state-owned enterprises in order to attract more private investment.
In total, 10 of the 30 companies owned by the National Service Projects Organization (NSPO) affiliated with the Ministry of Defense will be sold to private investors, domestic and foreign, according to Director Soliman.
Since coming to power, President Abdel Fattah al-Sisi has undertaken to give a new direction to the national economy, not only by launching mega-infrastructure projects, but also by reducing the state monopoly in several key sectors.
Thus, after undertaking drastic reforms led by the International Monetary Fund (IMF), the government decided to reduce, or even eliminate its participation in several public companies, in favor of private investors whose activities were hitherto hampered by competition from state enterprises.
“This is a historic change in the structure of the Egyptian economy,” Planning Minister Hala El-Said said as quoted by Bloomberg. “All state institutions want the private sector to play a greater role in development projects,” she added, indicating that the offer of participation in army companies is “a signal very serious government ”.
As of yet, the names of the three new companies that will be privatized have not been released. A few days ago, two previous companies had been designated to undergo the same process, namely: the National Company for the Production and Bottling of Water (Safi) and Wataniya Petroleum.
Source Ecofin Agency
