Egypt’s Minister of Public Enterprise Sector Hesham Tawfik told MPs on Tuesday in a plenary session that the government has devised a plan for reforming public sector companies within two and a half years.
“We are currently aiming to reform 26 companies and aim to turn them into profitable businesses within 30 months, and we chose these companies because their promising production potential,” said Tawfik.
Answering a number of questions directed by MPs, Tawfik said the number of companies affiliated with the ministry stands at 121.
“Out of these, which are working under the purview of 16 holding companies, 48 have incurred EGP 7.5 billion in losses in 2017, while others generated EGP 7.5 billion in profits,” said Tawfik, adding that “the number of employees in the 121 companies stand at 214,000, with 54,000 being affiliated with the spinning and weaving companies.”
Tawfik said an amount between EGP 2 billion and EGP 3 billion will be allocated to upgrade the giant Helwan’s Iron and Steel company and the Delta Steel Company. “Foreign experts will come to prepare an investment study about the two companies, and we hope that at the end the two with all of their production lines working at full capacity.”
Tawfik said the giant Helwan Iron and Steel Company, established in 1964, is a source of pride for all Egyptians.
“With stiff competition from private sector companies in an open economy, the company began to stumble, but it still has promising potential, and we hope it will regain its foothold as Egypt’s major iron and steel company,” he said.
Parliament speaker Ali Abdel-Aal commented that “the restructuring of public sector companies has become a necessity.”
“The bankruptcy law was issued by parliament to tackle the problems of loss-making companies through restructuring, and if impossible, through liquidation,” said the speaker, adding that “we should no longer view public sector companies as a sacred cow, and all should be subject to different forms of reform in a competitive market economy.”