Egypt to sell state assets as it seeks $40bn in investment

Egypt outlined on Sunday a wide array of state assets that it will offer to private investors, part of a government plan to fully withdraw from certain sectors of the economy as it seeks to attract $40 billion in investment over the next four years.

Egyptian Prime Minister Moustafa Madbouly said he wanted private investment to rise to 65 per cent of the country's total within three years, up from about 30 per cent at present.

"We will offer projects to the private sector in electric vehicles, data centres, networks for oil and gas and expansion of gas liquefaction plants, communication towers, and wind power," Mr Madbouly said at a news conference.

It will also eventually open up renewable energy projects, desalination plants, education and banking assets to private investment.

The government has been talking about selling state assets for years, announcing in 2018 that it would offer minority stakes in 23 state-owned companies. The programme has been repeatedly delayed due to weak markets, legal hurdles and the readiness of the companies' financial documentation.

It faces a rising budget deficit, increased borrowing costs and a depreciating currency, all compounded by a higher wheat import bill and declining tourism revenue following Russia's invasion of Ukraine.

The government will publish a document by the end of the month outlining the sectors from which it would withdraw completely or partially or where it would remain as owners, Mr Madbouly said. It would leave some sectors within three years.

Egyptian President Abdel Fattah El Sisi last month ordered the government to draw up a programme to attract $10bn in "private participation" over each of the next four years.

Mr Madbouly said the government had already identified $9 billion in assets that would be monetised and another $15bn that it would quickly begin preparing to offer.

"Those combined are more than the target for the first two years," he said. Among the assets that would be sold on the stock exchange by the end of 2022 were shares in 10 state companies and two military companies.

Egypt's seven biggest ports will be put under the umbrella of one company and a number of its most prominent hotels merged with another, with shares in both to be sold on the stock market to "widen their ownership and the governance of their management".

Also up for partial sale or private management contracts are transport projects the government is now implementing, including a monorail system, a high-speed and an electric train.

Mr Madbouly also told reporters the government aimed to decrease total debt to 75% of gross domestic product in the next four years from 86 per cent currently, and its budget deficit to 5 per cent from 6.2 per cent.