Egypt is embarking on a significant economic reform by offering stakes in military-owned companies through its sovereign wealth fund, a move designed to bolster private sector involvement and attract foreign investment. This initiative comes as part of Egypt’s commitment to fulfilling requirements set by the International Monetary Fund (IMF) for an expanded $8 billion loan agreement.
The decision to divest state assets, including stakes in companies like Safi, Wataniya Petroleum, Chillout, Silo Foods, and the National Company for Roads Building, marks a pivotal shift in Egypt’s economic strategy. The sovereign wealth fund, valued at $12 billion, was established in 2018 with the mission of fostering partnerships with the private sector and streamlining foreign investment into state-owned enterprises.
This move signifies a major policy shift for Egypt, which has traditionally been cautious about reducing state control over strategic assets.
Economic analyst Dr. Layla Amin commented, “This initiative is a positive step towards increasing transparency and competitiveness within Egypt’s economy. By involving the private sector more robustly, Egypt could enhance its attractiveness to foreign investors and stimulate economic growth.”
The Egyptian government aims to expedite the privatization process, planning to sell stakes in at least ten companies, including two military-owned ones, by 2025. This effort is expected to be completed by 2026, potentially reshaping the landscape of Egypt’s state-run enterprises.
The sovereign wealth fund’s involvement in restructuring these companies is a strategic move to ensure a smooth transition, providing a framework for efficient operations and governance that aligns with international standards.
