The Ministry of the Public Business Sector, responsible for managing state-owned assets and companies slated to be privatised, was abolished with the announcement of the cabinet reshuffle last week.
Prime Minister Mustafa Madbouli said the decision “was part of a vision drafted several years ago based on the understanding that the ministry’s role was transitional rather than permanent.”
He added that when appointing the minister of the public business sector, he had made clear that it might be in its final phase, given that its objective had been to reorganise the sector in preparation for a new stage.
Following the reshuffle, Madbouli convened with Hashem Al-Sayed, assistant to the prime minister and chief executive of the State-Owned Enterprises Unit, who stated that preparations were underway for 40 companies to be transferred to the Sovereign Fund of Egypt, while 20 are to be listed on the stock exchange.
The ministry had earlier overseen six holding companies encompassing around 60 subsidiaries.
Economic expert Mustafa Badra said that establishing a specialised unit to manage state-owned companies under the cabinet’s direction had signalled the beginning of the ministry’s dissolution.
It had been preparing to sell stakes in some of these companies via offerings on the stock exchange and strategic partnerships with investors. It was also planning to rehabilitate certain firms through fresh capital injections, as occurred for some spinning and weaving companies, and then to divest them afterwards.
Badra added that new government decisions would clarify how assets are to be handled, a process that may require parliamentary approval to amend the legal framework governing these companies.
Since the abolition of the ministry was announced, press reports citing government sources have sought to outline the fate of the companies previously affiliated with it.
According to the Enterprise newsletter, prominent historic hotels and tourism assets affiliated with the Holding Company for Tourism and the Ministry of the Public Business Sector are to be transferred to the Sovereign Fund of Egypt.
A government source told Al-Shorouk newspaper that the State-Owned Enterprises Unit would assume responsibility for managing companies affiliated with the Holding Company for Construction and Development following the presidential decree abolishing the ministry.
The unit reportedly plans to offer an additional stake in Heliopolis Housing and Development, which is listed on the stock exchange, in order to reduce the state’s shareholding in the company.
The Holding Company for Construction and Development owns 72.25 per cent of Heliopolis Housing and Development, whose capital stands at LE334 million.
Mohamed Fouad, an economic expert and member of the House of Representatives, said the Ministry of the Public Business Sector has been “amputated”. He believes the only available course of action should have been to transfer the sounder assets to the Sovereign Fund of Egypt and the less robust ones to the stock exchange.
He stressed that a persistent challenge remains in the shape of the accumulated debts owed by these companies to the National Investment Bank.
Alia Al-Mahdi, a professor of economics at Cairo University, rejected the decision to abolish the ministry. She argued that as long as the companies are not put on the block a dedicated ministry should remain in place to manage them.
Al-Mahdi questioned what would render the Sovereign Fund of Egypt successful in administering these enterprises, noting that its core mandate is to manage the proceeds of divested companies rather than to operate companies directly.
She added that disposing of the companies without a clear supervisory umbrella would weaken accountability and complicate the evaluation of their assets.
The enterprises, she argued, should be managed efficiently in preparation for sale. Even if only partial stakes are to be floated on the stock exchange, a central authority, formerly the ministry, should determine the proportions of them to be offered.
Fouad added that prior to the departure of planning minister Rania Al-Mashat in the last cabinet reshuffle, there had been a plan to address corporate indebtedness. He pointed out that some companies, including subsidiaries of the Holding Company for Chemicals and the Holding Company for Metallurgical Industries, possess strong asset bases and solid performance records.
He criticised the cabinet statement for merely citing figures regarding the number of companies to be transferred to the Sovereign Fund of Egypt and those to be listed on the stock exchange, arguing that these provide little clarity. What is required, he said, is a clear plan based on each company’s performance.
Badra suggested that the companies could be distributed according to their sectoral specialisation among relevant ministries, some to the Ministry of Industry or the Ministry of Housing, for example, while others would be transferred to the Sovereign Fund of Egypt.
He noted that such measures would require parliamentary approval in addition to amendments to the laws governing these companies.
Fouad, however, regarded this proposal as a reversion to the 1960s model of the public sector in its traditional form.
Beyond the accumulated debts owed to the National Investment Bank or to the Ministry of Electricity by certain companies, Fouad questioned who would manage the enterprises and who would preside over the general assemblies of the holding companies.
These were critical issues left unanswered by the cabinet’s statement, he said.
In statements made in December, former minister of the public business sector Essmat Shimi said that the ministry had adopted a self-financing model, avoiding any additional burden on the state’s general budget.
He pointed to the ministry’s success in resolving a number of longstanding financial entanglements, including the settlement of LE620 million in debt owed by the Holding Company for Pharmaceuticals to the Egyptian Drug Authority.
This was achieved through an asset-swap mechanism, he explained, utilising Aga Khan land by converting it into a housing project in coordination with the Ministry of Housing in a step intended to strengthen the companies’ financial positions without recourse to public funds.
He also noted that the Holding Company for Spinning and Weaving remains committed to servicing annual instalments of €80 million, equivalent to LE4 billion, on loans taken out to modernise spinning and weaving machinery and financed from its own resources.
The government is seeking to raise approximately $10.3 billion, Madbouli said at the end of 2024, through divesting public enterprises. It plans to offer at least 10 companies initially targeted for 2025, including four military-owned firms —Wataniya, Safi, ChillOut and Silo — for listing on the stock exchange.
In addition, it intends to offer stakes in the Gabal Al-Zeit wind farm, Al-Amal Al-Sharif Plastics, Misr Pharmaceutical Industries, and SID Pharmaceuticals during the 2026-2027 fiscal year.
Fouad believes that these plans will remain unaffected, as they now fall under the supervision of Hashem Al-Sayed, assistant to the prime minister and chief executive of the Central Unit for State-Owned Enterprises, who will proceed with their implementation.
* A version of this article appears in print in the 19 February, 2026 edition of Al-Ahram Weekly
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