A three-day economic conference that opened in Cairo on Sunday signalled a firm state commitment to live up to a promise it had made earlier in the year to better engage the private sector as a key player in the economy.

President Abdel-Fattah Al-Sisi, who made a lengthy statement at the inaugural and closing sessions of the conference, said that the role of the private sector will also be included in the policy-making phase. Al-Sisi said he had directed the government to hold this week’s economic conference to lay out a road map for a more competitive and resilient economy.

Attended by representatives of the government, the private sector and a wide range of economists, the conference kicked off under the theme “A roadmap for a more competitive economy”. Participants agreed that a key challenge to any future economic roadmap was to deal with the tough impact of the Russian war on Ukraine and the parallel loss of $25 billion of indirect foreign investment in local debt instruments that exited the country with the increase of interest rates by the Federal Reserve. They also agreed on the need to address the drop in tourism revenues and those of many industries. Accelerated inflation and increasing prices of oil and gas also topped the agenda.

Addressing the conference, Prime Minister Mustafa Madbouli said the state was determined to create an attractive environment for both local and foreign investors in line with the State Ownership Policy Document (SOPD), focusing on raising the private sector’s contribution to the economy. In June, the government tasked the SOPD with the objective of increasing real GDP growth to between seven per cent and nine per cent through increasing public investments by between 25 per cent and 30 per cent and the creation of more job opportunities. The basic plan of the SOPD is to raise the input of the private sector from the current 30 per cent to 65 per cent over the next three years.

According to top officials at the Finance Ministry, under the SOPD the state intends to fully exit from 79 schemes in its current economic activities and to lower its investments in another 45 schemes to allow more room for the private sector.

Meanwhile, government officials told the conference that they are hoping to take tourism revenues up to $30 billon to grant more smart incentives for investors and to raise the capacity of companies operating in the Egyptian market to increase their competitive edge.

Madbouli said the government was committed to “work harder” to reach out to the business community and that of investors and to extend more incentives to entice more input from both communities. He added that the private sector supervised around 90 per cent of national mega projects completed over the past few years with a budget of LE7 trillion. He added that the private sector has 74 per cent of the country’s overall workforce.

Minister of Planning and Economic Development Hala Al-Said argued that The Sovereign Fund of Egypt (TSFE) is also working to foster chances for more investments, both foreign and local. “TSFE has its own law that grants it the flexibility of investment without being restricted by formal rules and systems,” Al-Said stated. She added that “as a developmental fund, it aims at making returns over the long term and achieving a positive socio-economic impact as well”. According to Al-Said, the TSFE has allowed for investing in state-owned assets.

Al-Said explained that as the state’s investment arm, TSFE has five sub investment funds: one for tourism, real estate investment and antiquities development, a second for health services and pharmaceutical industries, a third for utilities and infrastructure, a fourth for financial services and digital transformation, and a fifth for the management of state-owned assets refactoring.

The minister added that the TSFE has an extra arm that works with companies that are due to be listed in the Egyptian Exchange under the government initial public offering (IPO) programme in line with the SOPD plan.

According to Al-Said, TSFE’s investments currently focus on four main sectors: education, industry, telecom, and agriculture and food industries.

She added that TSFE had managed to execute 10 projects in 2021 in five sectors with total investments worth LE25.5 billion. “For every LE100 billion that the TSFE invests, it attracts LE5.4 billion in new investments to the Egyptian market.”

She also noted that TSFE’s authorised capital had doubled to LE400 billion. According to Al-Said, the TSFE is targeting LE1 trillion of investments over the next five years.

Participants in the conference discussed the education sector in Egypt as a possible attraction for foreign and local investors. The conference decided to set up joint mechanisms of the government and investors to formulate policies and guidelines to develop the education sector and make it more appealing for potential investments.

In this respect, the conference endorsed the need to licence more private and international schools in Egypt.

The conference also addressed potential investments in the transport industry. “Egypt’s transport sector has a bunch of investment opportunities, especially in creating dry ports, improving railways, and constructing logistic zones,” Minister of Transport Kamel Al-Wazir told investors.

Al-Wazir noted that there are ongoing contracts with foreign investors regarding the number of investment opportunities in the sector, including Abu Dhabi Ports Group, which is planning to manage and operate one of the Safaga Port stations, and the Qatari Maha Capital Partners, which is set to participate in the management and operation of container terminals in Port Said, Damietta and Hurghada ports.

Al-Wazir noted that the ministry welcomes new, serious investments in the logistic zone of the Alexandria and Ein Al-Sokhna ports, as well as investing in establishing grain and cereal silos over 270,000 square metres. He added that his ministry has a holistic plan to set up 14 land ports and logistics zones in the country. These, Al-Wazir argued, are unique investment opportunities for foreign and local investors.

*A version of this article appears in print in the 27 October, 2022 edition of Al-Ahram Weekly.