The government has issued the second edition of the State Ownership Policy Document which sets out the state’s vision for reducing its footprint in economic activities and encouraging private investment. The document, in its two editions, aims to raise private sector contribution to GDP, stimulate growth, and improve competitiveness.
The second edition was launched earlier this month under the theme “Deepening Reform and Maximising Impact”. It incorporates lessons learned, recommendations from Egypt’s national dialogue, and international best practices. It will cover 2026 to 2030.
The second edition signals a philosophical and structural transformation from “complete sectoral withdrawal from the economy” to “selective ownership”, a change that will shape the contours of Egypt’s national economy through 2030.
Issued on 17 June, the edition introduces 12 substantive changes that redraw the boundaries of the state’s economic role through stricter governance and expanded coverage of all public assets in their various legal forms, according to statements by Prime Minister Mustafa Madbouli and Osama AlGohari, head of the cabinet’s Information and Decision Support Centre.
“What philosophically distinguishes the second edition from its predecessor is the transition from a logic of quantity to a logic of impact,” said Islam Abdel-Bari, a professor of economics at the Arab Academy for Science, Technology, and Maritime Transport.
“The first edition measured success by the sheer volume of divestment. How many dollars did we raise? In contrast, the second edition explicitly links divestment proceeds to reducing public debt, financing productive investments, and boosting the private sector’s contribution to GDP. This represents a commendable maturity in policymaking.
“Furthermore, for the first time, the document specifies the targeted sectors by name: airports, banking, telecommunications, tourism, petrochemicals, electricity, cement, mining, pharmaceuticals, and transportation. This precise identification removes execution ambiguity and sends clear signals to both local and foreign investors,” Abdel-Bari added.
Although the first phase of the document (2022-2025) delivered undeniable results — 19 transactions worth $5.86 billion and more than 1,000 reform measures — Abdel-Bari said he considered the most significant achievement to be institutional. For the first time, Egypt introduced a binding legal framework through Law 170/2025, regulating state ownership in companies, and establishing the Central Unit for StateOwned Enterprises under the prime minister’s office, replacing the abolished Ministry of Public Business Sector.
He stressed that this was no marginal achievement, noting that enshrining state ownership rules in law is politically far more difficult than issuing guidance papers, and Egypt succeeded in doing so.
Yet fundamental reservations remain. The document’s new edition sets out the ambition of raising private sector participation in GDP by 2030 but fails to specify measurable targets. By contrast, Saudi Arabia’s privatisation programme, for example, set a clear benchmark, aiming to lift private sector contribution from 40 to 65 per cent by 2030. The absence of such figures in Egypt’s plan makes accountability difficult.
Abdel-Bari stressed that the document remains essentially a framework of policy guidelines, with the operational programme yet to be announced. For investors, this leaves critical questions unanswered — timing, pricing, and mechanisms.
Without an executive programme, he argues, the document resembles a map without a scale; it points in the right direction but does not show the distance.
Abdel-Bari also raised the issue of how major deals are classified. The government counted $30 billion in proceeds from the first phase by including “large developmentimpact deals”, implicitly referring to Ras Al-Hekma and Alam Al-Roum. Yet these are in fact longterm development concession agreements, not equity divestitures in the strict sense. Mixing the two inflates the figures, distorts international comparisons, and undermines credibility with rating institutions that distinguish between the models.
He further highlighted a deferred challenge: how to deal with economic authorities. Although the document devotes an entire section to restructuring, specific timelines remain postponed. This is a pressing issue, as lossmaking represents a chronic fiscal burden on the state budget.
He argued that issuing a welldrafted document is not enough; the gap between a strategic framework and actual implementation must be closed through urgent steps. These include publishing a detailed executive programme before the end of 2026 with sectoral timelines and quantitative targets, adopting a transparent dual classification that separates equity divestitures from PPP or concession agreements with clear performance indicators, and immediately announcing the schedule for bank offerings. The planned floatation of Banque du Caire in the first half of 2026 will be the first real test of the second edition. Its success would restore confidence in the privatisation programme, while any delay would hand fresh arguments to sceptics.
Mustafa Badra, an economy expert and professor of finance and investment, states that the difference between the first and second policy versions focus on improving review mechanisms and expanding the private sector’s role across more diverse activities. However, the real benchmark for evaluating the document lies not in the textual differences between the two versions, but in its practical implementation on the ground.
For instance, while the target might be to IPO a specific number of companies, actual market listings might see weak demand, with investors only acquiring a fraction of them. This represents a shortfall in achieving the document’s objectives. Therefore, despite the announced intention to yield more room for the private sector in economic activity, it still lacks the necessary diversity required to achieve a breakthrough in economic growth.
Also, Badra argues that the document is out of step with global economic debates on artificial intelligence in management, manufacturing and governance. While many countries are pouring huge budgets into AI to boost GDP, Egypt’s policy shows little connection to this trend, despite evidence that AI integration can significantly raise productivity. He added that flexibility in setting strategies is crucial, since global conditions often block execution. Investor appetite is shaped by geopolitical tensions and risk perception which can dampen enthusiasm for foreign direct investment, particularly in emerging markets.
The executive programme of the document is scheduled for release before the end of September, and is expected to set measurable quantitative targets, specifying divestment ratios for each sector, and introducing monitoring mechanisms based on clear performance indicators. These measures aim to strengthen investor confidence and provide markets with a clearer outlook on the future role of the state in the economy.
The last couple of months witnessed a number of long-awaited privatization deals which included TAQA Energy buying a stake in the military affiliated Wataniya fuel stations and the UAE Al Cazar Group taking over the management of Egypt’sl second largest wind Farm, Gabal El-Zeit.
* A version of this article appears in print in the 25 June, 2026 edition of Al-Ahram Weekly.
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