Setting the economy to rights

Gamal Essam El-Din , Friday 14 Oct 2022

“Amid the severe economic crisis that the world is facing, we should set out a roadmap for ourselves to forge ahead with economic development in the country at a higher pace and with greater participation from the private sector,” Prime Minister Mustafa Madbouli said during a meeting on Monday.

Mostafa Madbouly


This roadmap will be discussed in detail during the three-day economic conference that the government is organising on 23-25 October.

President Abdel-Fattah Al-Sisi recently called for the organisation of the conference to examine the challenges facing the private sector. The conference, which will gather the business community and government representatives, aims to help the economy through the currently harsh global economic conditions.

According to the conference agenda released on Monday, the participants will be discussing macroeconomic policy, main economic indicators, and the policies needed to achieve financial sustainability and raise the competitive edge of the Egyptian economy.

A host of prominent economists will offer their views on how to contain the fallout from the global economic crises triggered by the war in Ukraine. The conference will also focus on discussing the State Ownership Policy Document in detail. “We have finalised this document and it is now to be discussed by the economic conference before it is adopted formally,” Madbouli said.

This document sets out ways to restructure the economy in favour of the private sector. Unveiled in June, it sees the government aiming to attract $40 billion in fresh investments over the next four years by selling stakes in state-owned assets to local and international investors.

“We are aiming to raise $10 billion each year by offering a range of assets to the private sector,” Madbouli said.

The document seeks to double the private sector’s role in the economy in terms of increasing its contribution to economic investment to 65 per cent over the next three years, up from 30 per cent last year.

Madbouli said the three-month consultations over the State Ownership Policy Document will also be up for debate on the second day of the economic conference. “We will review the outcome of these consultations and see if it is possible to redraft the document in the light of them,” he said, adding that “once drafted in its final form, this document will act like a ‘constitution’ for the country’s economic activity until 2030.”

Madbouli indicated that the growing role of the Sovereign Fund of Egypt (SFE) in the national economy will also be on the table on the second day of the conference. “We will discuss how the SFE can double the state’s revenues from its assets and how it can maximise its partnership with the private sector, in addition to reinforcing the role of the non-banking sector, with a focus on the Egyptian Stock Exchange,” he said.

During the conference there will be debate on the future priorities of several sectors of the economy, notably energy, renewable energy, tourism and aviation, the petrochemical industries, communication and information technology, real estate development, green projects, transport, agriculture and land reclamation, and cattle and poultry production.

Madbouli said that between 400 and 500 figures hailing from 21 local and international institutions will participate in the event. The conference will be attended by representatives of various ministries and government authorities and bodies, including financial experts, heads of investment chambers and federations, the deans of various faculties of economics, several foreign ambassadors, representatives of the coalition of Egyptian political parties, and representatives of international companies.

The government launched a website and a mobile application to engage young people and experts not able to attend the conference on the issues on its agenda on 7 October.

While arranging for the conference, the government is also moving ahead with plans to speed up privatisations. Madbouli stressed that the privatisation programme is part of the roadmap for the country’s economy in the short and medium terms. During two meetings held this week he discussed the government’s preparations for speeding up the privatisation programme and reviewing the assets of companies and state-owned hotels that could be the target of initial public offerings (IPOs) on the Egyptian Stock Exchange.

In the first meeting on Monday, Finance Minister Mohamed Maait said that due to the war in Ukraine, which has triggered global financial headwinds, high inflation rates, and the tightening of fiscal and monetary policies, world stock markets are currently seeing the worst of times.

However, “the government is doing its best to make sure that its privatisation programme will not be hobbled by the global negative economic developments,” Maait said, stressing that the government is committed to speeding up the privatisation programme and boosting private investments.

According to Ayman Suleiman, executive director of the SFE, several financial institutions have shown an interest in Egypt’s privatisation programme. “The sovereign funds of the oil-rich Arab Gulf countries have already begun buying stakes in state-owned assets and are promising to invest more,” Suleiman said.

The economic conference will be a good opportunity to highlight Egypt’s privatisation programme, Madbouli said during a meeting a day earlier. He proposed that the first step should begin with listing shares in state-owned hotels, noting that several international investors and investment funds had submitted offers to acquire shares in them.

“The government is currently evaluating the hotels ahead of moving forward with the sales process itself,” he said.

The ministries of planning and economic development and of public enterprise are currently coordinating on listing shares in some five-star hotels owned by the state-owned Egyptian General Company for Tourism and Hotels (EGOTH), Cabinet Spokesman Nader Saad said.

“As several international investors and Arab sovereign funds have already submitted offers to acquire shares in these hotels, the two ministries are now under directives from the prime minister to finalise evaluating these hotels as soon as possible in order to begin turning the first step of the privatisation programme into facts on the ground,” Saad said.

This week’s two meetings also come after another meeting that Madbouli held last week to review the restructuring of Egypt’s National Company for Producing and Bottling Water (Safi) and Al-Wataniya Petroleum in preparation for listing some of their shares on the Stock Exchange before the end of 2022.

*A version of this article appears in print in the 13 October, 2022 edition of Al-Ahram Weekly.

Short link: