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Egypt to Privatize Government-Owned Businesses as Country Experiences Economic Crisis

With the Egyptian economy suffering greatly as inflation reached almost 15% in April; the prime minister, Mostafa Madbouli, revealed a state plan to reduce the pressure of economic sustenance on the nation.

The prime minister claimed that the country will now begin a plan to privatize a series of state-owned companies in this interesting attempt to get the country back on its feet.

The Egyptian government revealed plans to privatize at least 10 public companies; two of those companies belong to the Egyptian army.

However, in response to the seven which would seemingly be left; the strategy would be to create two listed companies. One of these companies would absorb seven of these public companies which operate as “the seven main Egyptian ports;” while the other would function as “the country’s best hotels.

Egypt to Privatize Government-Owned Businesses

Of course, there are no reliable estimates of the military’s economic impact.

The army claimed in 2019 to “supervise” over 2,300 projects involving five million people. Non-oil private sector activity has remained flat since 2017, and again in April; indicating a distinct lack of vitality.

Plans For Revitalization

These statements had been expected since President Abdel Fattah al-Sissi called on his cabinet to develop a privatization policy; aimed at delivering “ten billion euros per year over a period of four years” into the national coffers in early May.

The prime minister explained on Sunday, that; “full empowerment of the private sector” by 2025 is part of Cairo’s economic crisis solution. He advocated for a 65 percent increase in private sector participation in total investments, up from the present 30 percent.

Though some believe that the Egyptian government stands a chance in competing fairly with the Private sector. As noted in the words of Naguib Sawiris; one of the country’s wealthiest billionaires, who told AFP in 2021; “The state should have a regulatory function and not be a stakeholder.”

Egypt recently depreciated its currency by 17% due to the economic consequences of the Ukraine war; soaring inflation, and massive public infrastructure investment.

These statements had been expected since President Abdel Fattah al-Sissi called on his cabinet; to develop a privatization policy aimed at delivering; “ten billion euros per year over four years” into the Egyptian national treasury in early May.

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