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Unlocking Growth: Egypt’s Privatization Plan Reaches a Key Stage
Egypt’s long-awaited plan to privatize state-owned companies is now entering an important stage. The government is speeding up the sale of public assets as part of its reform program linked to the International Monetary Fund (IMF).
Latest Privatization Push
Egypt plans to sell stakes in about 60 companies. This move is important for bringing in foreign investment, reducing pressure on government finances, and changing the role of the state in the economy. While the economy is starting to stabilize, deeper reforms are still needed. Selling state-owned companies is now a major test of Egypt’s plan to shift toward a private sector-led economy.
There are several key questions. Which companies are ready to be sold? Should the government sell shares through the stock market or directly to investors? And how will rules about ownership—especially for foreign investors—affect the results?
On April 14, Prime Minister Moustafa Madbouly said the government is preparing to list 10 petroleum companies on the Egyptian Stock Exchange (EGX). This will be done on a temporary basis. He explained that the goal is to improve competition, attract investment, and increase the role of the private sector.
Petroleum Minister Karim Badawi added that the plan focuses on strong companies that can attract foreign investors. Listing these companies on the stock exchange will improve management, offer new ways to raise money, and help them grow without depending on government funding.
Experts believe the energy sector will continue to attract investors. Pieter du Preez, a senior economist at Oxford Economics, said that energy has recently been one of the most profitable sectors and is likely to remain strong in the coming years. He also noted that real estate, especially large coastal projects, has performed well, although many of these projects have mainly targeted investors from Gulf countries.
Earlier, Finance Minister Ahmed Kouchouk said the government aims to complete three new offerings before the end of June. This shows that Egypt is serious about moving forward with its privatization program and boosting investment in the market.
Egypt’s Divestment Strategy
At the center of Egypt’s plan is a broad program to reduce its ownership in around 60 state-owned companies. These companies operate in different sectors such as banking, energy, logistics, and manufacturing.
Out of these, about 40 companies are being prepared for transfer to the Sovereign Fund of Egypt (TSFE). The remaining 20 companies are expected to be listed on the Egyptian stock exchange. This plan was outlined by Deputy Prime Minister for Economic Affairs Hussein Eissa earlier this year.
This approach shows that Egypt is using two methods at the same time. It will sell shares through public offerings and also sell directly to strategic investors. This strategy matches Egypt’s State Ownership Policy introduced in 2022, which aims to reduce the government’s role in non-essential sectors and encourage more private sector participation.
According to reports, Egypt hopes to raise around $10.3 billion from privatization by the end of the 2026–27 fiscal year. This money will help improve public finances and support economic growth.
However, the IMF has pointed out that progress has been slower than expected. Although inflation has decreased and pressure on foreign currency has eased, privatization efforts have not moved as quickly as planned. The IMF also said Egypt still needs large amounts of external financing—about $13 billion for the 2025–26 fiscal year and $4 billion for the following year.
Listings or Direct Sales?
One major decision Egypt faces is how to sell its assets.
Listing companies on the stock exchange allows both large and small investors to participate. It also helps develop the local financial market, which is important for long-term growth. However, this process can take time and depends on market conditions.
On the other hand, direct sales to investors can be completed more quickly and bring in foreign currency faster. This is especially important when the country is facing a shortage of foreign exchange.
The government is currently using both methods. As part of its IMF program, Egypt has promised to sell stakes in at least 10 companies in 2025 through both public listings and direct sales. Finding the right balance between these two approaches will be important for building investor confidence.
Role of the Sovereign Fund of Egypt
The Sovereign Fund of Egypt (TSFE) plays a key role in the privatization process. It was created in 2018 to manage and make better use of state assets.
By placing assets under the fund, the government hopes to improve efficiency, increase their value, and attract international investors. The fund works like a commercial entity, which helps reduce delays caused by bureaucracy.
TSFE has already created systems to prepare companies for stock market listings. It can bring in large investors before companies go public, making the process smoother.
Transferring companies to the fund also helps solve legal and administrative issues. It allows the government to improve management standards before selling the assets. In some cases, smaller companies can be grouped together to make them more attractive to investors.
In January, Minister of Investment and Foreign Trade Hassan El-Khatib said the fund’s assets had grown by more than 90% between 2023 and 2025. He added that the fund will focus on key sectors such as agriculture, food security, industry, education, and tourism.
As of the 2023–24 fiscal year, TSFE managed assets worth about $12 billion.
In another major step, Egypt decided to close the Ministry of Public Business Sector in February 2026. This decision shows a big change in how the country manages its economy. The government plans to restructure state-owned companies and increase their value.
Some companies will be transferred to TSFE for improvement, while others may be placed under different ministries. A few may remain under direct government supervision for now.
Foreign Ownership and Investment
Egypt has relatively open rules for foreign investors. In most sectors, foreign companies can fully own businesses. They can also buy land for business purposes, although there are some limits, especially on agricultural land.
However, selling important assets like ports, logistics systems, and energy facilities can be more complicated. While foreign investors may be allowed to own part of these assets, full ownership might not always be accepted.
Egypt has also introduced several laws to attract investors. The Investment Law of 2017 offers benefits such as tax reductions, a unified customs rate, and free land for certain projects.
In addition, the Green Hydrogen Incentives Law, introduced in 2024, provides strong support for projects related to green energy. This includes both tax and non-tax benefits.
In 2023, Egypt made another important change. It allowed companies with full or majority foreign ownership to register in the Importers’ Register. Previously, foreign investors needed at least 51% local ownership. Removing this rule makes it easier for international companies to operate and expand in Egypt.
What’s Next?
Egypt’s privatization program is an important part of its economic strategy. It aims to bring in foreign investment, reduce financial pressure on the government, and create a stronger role for the private sector.
The plan is already in motion. The companies have been selected, and there is interest from investors. The next few months will be very important.
If the government meets its target of completing new offerings by June, it will send a strong message to global investors. It will show that Egypt is moving beyond economic stabilization and entering a new phase focused on growth led by the private sector.
Overall, Egypt’s success will depend on how well it manages the sale process, builds trust with investors, and continues to carry out reforms. If done correctly, privatization could play a major role in shaping the country’s economic future.
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