On August 20, Egyptian President Abdel Fattah al-Sisi ratified new legislative amendments aimed at accelerating the sale of state-owned assets under what is known as the “State Ownership Policy Document.” These amendments grant Egypt’s Sovereign Wealth Fund broader powers to directly sell publicly owned assets, streamlining procedures that previously took months or even years before any deal could be finalized.
The law regulates companies in which the state owns all or part of the capital, including those affiliated with ministries, public authorities, and government agencies, while exempting certain companies of strategic nature or those established under international agreements. It also introduces multiple mechanisms for managing state assets, including sales, market offerings, mergers, and divisions, in order to promote transparency and economic governance.
Observers view this step as a response to conditions set by the International Monetary Fund and other financial partners to provide urgent liquidity that supports Egypt’s struggling economy amid the currency crisis and mounting debt. The government is betting on generating billions of dollars through offering stakes in strategic companies, some of which operate in infrastructure, energy, and financial services sectors. However, experts fear that accelerating the sale process may lead to unfair asset valuations or transfer control over vital sectors to foreign investors under terms that may not serve the national interest.
The new law establishes a new entity under the name “State-Owned Companies Unit” within the Cabinet as a central arm responsible for managing state ownership in companies. According to the Official Gazette (Issue No. 33 bis C of 2025), this unit will have broad powers ranging from reviewing restructuring and divestment plans to exploring opportunities for expanding partnerships with the private sector. Its responsibilities also include assessing the fair value of assets and issuing opinions on sales, mergers, or share offerings, effectively turning it into an economic operations room that directs the future of public assets.
The unit’s role is not limited to technical assessments; it also involves setting policies and submitting recommendations. The law stipulates that all its decisions must first pass through the Economic Ministerial Committee for review before being submitted to the Cabinet for final approval.
According to the government, this institutional hierarchy is meant to impose an organized and transparent framework for the process of divestment or restructuring, after years of controversy over the management of privatization and asset sales. However, observers argue that the unit’s success will depend on its actual independence and its ability to strike a balance between attracting foreign investment and safeguarding national economic interests.
Why Is the State Selling Its Assets?
Egypt’s severe financial crisis is pushing the government to rely on selling public assets as a means of securing urgent liquidity in foreign currency, amid the ballooning external debt and unprecedentedly high debt-service costs. The state can no longer borrow from international markets at the same pace as before, and the conditions set by international financial institutions have become far stricter, making privatization one of the few rapid options available to generate fiscal resources.
At the same time, the government promotes the idea that selling its stakes in companies is intended to attract foreign direct investment, ease the burden on the public budget, and reduce the state’s role in the economy, in line with the International Monetary Fund’s recommendations. Yet these justifications face widespread criticism, as experts argue that selling assets does not address the root causes of the economic crisis but instead sacrifices strategic possessions in exchange for temporary returns.
Mahmoud Mohieldin, the United Nations Envoy on Financing for Development, stated that the Egyptian economy has remained almost stagnant since 2015, with a constant GDP of about $480 billion, showing little change despite population growth and deep structural challenges. He explained that the real economy has revolved around what he described as “crisis management” rather than sustainable development. This, he said, necessitates an urgent national economic program independent of the IMF’s framework—one that focuses on exports, investment growth, productive efficiency, strengthening the middle class, combating extreme poverty, and addressing income inequality.
Over the past decade, Egypt’s external debt has risen sharply. In June 2015, it stood at $48 billion, rising to about $55.8 billion by the end of 2016. Following the launch of the IMF-backed economic reform program and the subsequent currency flotation that same year, the debt jumped to $82.8 billion in 2017. The upward trajectory continued, reaching $96.6 billion in 2018, $106.2 billion in 2019, and surpassing $123.5 billion in 2020.
Amid the repercussions of the COVID-19 pandemic, external debt climbed further to $137.8 billion by the end of 2021, then to $162.9 billion at the end of 2022. In 2023, it reached about $168 billion before declining slightly to $155 billion in January 2025, according to the latest data from the Central Bank of Egypt.
In this context, the Central Bank’s Economic Bulletin (April 2025) shows that total external debt stood at $155 billion last January. Of this amount, $124 billion represents long-term debt, while $30.9 billion is short-term.
International financial institutions—led by the World Bank and the International Monetary Fund—top Egypt’s list of foreign creditors, with a combined total of $46.1 billion. They are followed by Egypt’s international bonds issued on global markets worth around $27.2 billion. Other components of the debt include foreign deposits of $16.5 billion, bilateral loans amounting to $15.8 billion, and obligations to the Paris Club totaling $10.5 billion.
By country, the External Position of the Egyptian Economy report (covering July–December 2024) issued by the Central Bank reveals that Saudi Arabia is Egypt’s largest creditor with $13.9 billion, followed by the United Arab Emirates with $11.3 billion, China with $8.6 billion, and Kuwait with $6 billion. The list also includes Russia ($4.2 billion), the United States ($3.3 billion), Japan ($2.6 billion), France ($2.4 billion), Germany ($2.1 billion), and the United Kingdom ($1.2 billion).
Egypt’s financial landscape is not limited to external debt alone but also includes significant domestic liabilities, notably those tied to foreign holdings in government debt instruments. Recent estimates indicate that foreign investments in Egyptian treasury bills amount to around $40 billion. Although these are classified as part of the domestic debt, they are repaid in foreign currency rather than in Egyptian pounds, adding pressure on Egypt’s foreign-exchange reserves and increasing the economy’s vulnerability to sudden capital outflows during crises.
Key Sectors Up for Sale
In an interview with Zawia3, Mohamed Ramadan, an economic researcher at the Egyptian Initiative for Personal Rights, stated that the recent decisions aimed at accelerating the state asset sale plan “primarily serve as a reaffirmation of the government’s commitment to the International Monetary Fund program, particularly within the framework of the fourth review, during which the Fund emphasized the need to hasten the government’s withdrawal from various sectors of the economy.”
Ramadan explained that the current measures represent a continuation of a trajectory that began in 2022 but now come under more direct pressure from the IMF. He pointed out that the key sectors expected to be offered in the coming period are those listed in the “State Ownership Policy Document,” led by the construction and building sector, in addition to others the IMF explicitly mentioned in its latest review—such as cement, iron and steel, and marble—sectors where the state controls shares that reach up to one-third of the market or more.
The researcher told Zawia3 that the issue lies not only in the sectors being offered but also in the nature of the divestment process itself. “Selling assets is a complex process that takes much longer than the IMF anticipates, given the need for precise valuations, offering procedures, and favorable market conditions to complete the sale,” he said. “The Fund’s insistence on speeding up the process may not be realistic given market considerations. Even if sales take place in the coming months, their impact on the overall economy will be limited, as the expected financial returns are not large enough to change the picture.”
Regarding claims that the accelerated sale is linked to the decision to raise the external debt ceiling, Ramadan said, “All these issues are interconnected in the broader picture, but there is no evidence of a direct relationship between the two decisions.” He added that the government itself had previously presented the IMF with a divestment timeline in its “Letter of Intent,” yet internal dynamics such as inflation, price volatility, and market factors continue to influence the pace of implementation.
IMF vs. Egypt’s Military Economic Empire: IMF’s View and Egypt’s Response
Ongoing IMF Pressure
The International Monetary Fund places privatization at the core of its program with Egypt, viewing it as the fastest route to reducing the state’s economic footprint and attracting foreign currency through foreign investment. In its latest review, the Fund reiterated the need to expedite the withdrawal from public-sector companies, especially those that dominate the market, such as cement, steel, and marble firms. However, this pressure collides with a complex reality: sales require lengthy processes of valuation, pricing, and negotiation, while the IMF demands quick results.
Although the periodic reviews show modest improvements in indicators such as inflation and foreign-currency reserves, “the pressure to achieve tangible progress in reforming the state sector and the limited advances in divesting state-owned companies” remain key concerns.
In a striking statement issued in mid-July, the IMF criticized the continued involvement of the military establishment in Egypt’s economic activities, warning that state dominance—particularly by the armed forces—hampers growth and restricts employment and investment opportunities. The report, published as part of the fourth review of the $8 billion loan program, revealed for the first time that the military owns 97 companies, including 73 in the industrial sector alone, describing this situation as one that “obstructs growth and prevents the creation of real job opportunities for the private sector.”
In its report, the IMF directly linked the slow implementation of the privatization program to the need to merge the fourth and fifth reviews. It also noted that the projected proceeds from asset sales dropped from $3 billion to $0.6 billion by the end of the fourth quarter of 2024 due to the sluggish pace of divestment. According to IMF Deputy Spokesperson Julie Kozack, the delayed application of the divestment policy led to the merging of the fifth and sixth reviews. Kozack stressed the need to deepen reforms in the public business sector, reduce the role of the state in the economy, and accelerate the sale of government and sovereign company stakes to ensure the release of the upcoming financing tranche.
Egypt’s Deputy Minister of Finance, Ahmed Kojak, meanwhile expressed optimism about completing the joint fifth and sixth reviews during September or October of this year, saying that such progress would open the door to injecting an additional $2.5 billion to support the budget. He affirmed the government’s commitment to completing three to four privatization deals before the end of the current fiscal year and to expanding partnerships with the private sector, particularly in energy, tourism, real estate, and financial services.
Among the key measures planned for the coming period is the offering of stakes in army-owned companies through Egypt’s Sovereign Wealth Fund, fulfilling the IMF’s condition to reduce the economic role of the state and the military in civilian sectors. Companies expected to be included in these offerings are Wataniya Petroleum, Safi, Silo Foods, Chill Out, and the National Company for Roads and Development. Additionally, several historic government buildings in central Cairo are set to be offered for investment through the same fund.
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How Did the Path of Privatization Begin?
In 2022, Cairo entered a new phase of its state asset sales program through a series of major deals with Gulf investors. The Saudi sovereign wealth fund (Public Investment Fund) acquired minority stakes in four state-owned companies listed on the Egyptian Stock Exchange for approximately $1.3 billion, through its subsidiary, the Saudi Egyptian Investment Company.
During the same period, the Abu Dhabi sovereign wealth fund purchased stakes in five state-owned companies worth about $1.85 billion, focusing on the fertilizer, petrochemical, and logistics sectors. As a result, significant portions of companies such as Abu Qir Fertilizers, MOPCO, Alexandria Container & Cargo Handling, and e-Finance were transferred to Saudi and Emirati investors.
The Egyptian government linked these deals to the urgent need for liquidity and debt repayment, emphasizing that they are part of a strategy to maximize the value of state assets and reorganize the government’s role in the economy while safeguarding the rights of future generations.
However, the program did not end with the 2022 transactions. It expanded into new sectors over the following two years. In May 2023, the state sold 9.5% of its shares in Telecom Egypt through a secondary public offering on the stock exchange for 3.75 billion pounds ($77.6 million). A few months later, in September, the Emirati company Global Investment Holding acquired 30% of Eastern Company (Eastern Tobacco) for $625 million, in addition to committing $150 million to finance tobacco imports, which reduced the state’s ownership to about 20.95%.
In December of the same year, Egypt’s Sovereign Wealth Fund executed a deal to sell a portfolio of seven historic hotels, including the Mena House, Winter Palace, Old Cataract, and Cecil, to ICON, a subsidiary of the Talaat Moustafa Group, for $800 million. In January 2024, the Emirati fund ADQ joined as a partner in this portfolio by acquiring 40.5% of ICON, reflecting the hybrid nature of partnerships that the program fosters between the government and local and foreign investors.
The Egyptian government plans to expand the privatization program in 2025 to include more than twenty companies across multiple sectors. The list includes banks such as Bank of Alexandria and Bank of Cairo, renewable energy plants like the Gabal El-Zeit wind farm, Beni Suef (Siemens), and Zafarana, as well as industrial firms such as Egypt Pharma, alongside army-owned companies like Wataniya Petroleum and Safi Water.
The plan also targets the sale of stakes in petrochemical and oilfield service companies, including Ethydco, Elab, and National Drilling, and extends beyond companies to include major real estate development projects such as Ras El-Hekma on the Mediterranean coast, with announced investments of $35 billion. This project, however, resembles a long-term development right rather than a direct sale of existing companies.
On the financial front, the government aims to raise about $3.6 billion from asset sales during the 2024/2025 fiscal year. The program also includes the sale of land and diverse investment projects, including residential, industrial, and agricultural plots in the New Administrative Capital and Badr City, as well as tourism and commercial lands in Hurghada and the Red Sea region. These assets are presented as investment opportunities for urban and tourism expansion across the country.
This policy framework is organized under the State Ownership Policy Document, launched in 2022, which outlines where the state will remain an active player and where it will exit, with a goal of reducing its presence in dozens of sectors within three years, and increasing the private sector’s share of the economy to 65%. The government considers this document a safeguard to balance the need for external financing with the preservation of strategic assets for future generations.
Egypt’s Fifth IMF Review Sparks Controversy Over Asset Sales and Public Services
Does the Government Have Another Option?
In an interview with Zawia3, Zohdy El-Shamy, an economist and chairman of the board of trustees of the Popular Socialist Alliance Party, said that Egypt is now living under the constant rhythm of “privatization and sale news” almost on a daily basis, as if it has become “the only available economic policy.” He asked, “Can this really be considered a rational economic choice?”
El-Shamy explained that after the government pushed external debt to around $150 billion and became unable to secure new loans as before, it chose the path of selling assets to meet its obligations. He stressed that this policy does not solve the crisis but instead deprives the state of profits from successful enterprises such as fertilizer companies, Abu Qir, MOPCO, Eastern Tobacco, pharmaceutical firms, and banks. Moreover, it allows foreign investors to repatriate profits in foreign currency, further straining the economy rather than relieving it.
The economist and political figure told Zawia3 that what is happening is “a sale of what the government does not own to those who do not deserve it,” arguing that the government is sacrificing the future of current and coming generations. He warned that the risks are not only economic but also extend to national security, citing the sale of ports and the privatization of airports as particularly dangerous steps.
El-Shamy noted that “even the United States itself once rejected Abu Dhabi’s acquisition of American ports due to national security concerns—so how can Egypt allow this?” He pointed out that the UAE is involved in projects and interests that conflict with Egypt’s strategic interests, such as the Jebel Ali Port project and the new India–Middle East–Europe trade corridor, which connects India to the Mediterranean via Haifa, Jordan, and the UAE.
Does the Government Have the Right to Sell State Assets?
Since 2014, Egypt has enacted legal amendments that allow the government to sell public assets. The Law Regulating Appeals Against State Contracts prohibits third parties from filing lawsuits against contracts concluded with the state. This means that only the parties directly involved in such contracts may bring legal action, unless any of them is found guilty of crimes involving public funds.
Former interim president Adly Mansour ratified this controversial law in 2014. It was introduced in the wake of the January 2011 Revolution, aiming to prevent interference in state contracts—or the prosecution of cabinet members and government officials by outside parties—on the grounds that they act in the public interest.
The Administrative Court later referred the law to the Supreme Constitutional Court to assess its constitutionality, in the context of a lawsuit filed years earlier by employees of the Nubaria Seed Production Company (Nubaseed) challenging the government’s decision to privatize the company.
However, the Egyptian Constitution obliges the government to protect public property and national resources. Article 32 of the Constitution states:
“Mineral wealth and natural resources belong to the people, and their revenues are their right. The state is committed to preserving, developing, and ensuring their sound exploitation while considering the rights of future generations. Public property of the state may not be disposed of, and the granting of concessions for its use or the operation of public utilities shall be regulated by law and for a limited duration. The law shall define the rules and procedures governing the disposal of private state property.”
The liquidation of state assets is one of the economic tools that governments use to achieve specific financial goals. It refers to the process of converting state-owned assets—such as real estate, companies, and infrastructure—into cash through their sale or privatization. Governments employ this approach to pursue several objectives, including reducing public debt, improving economic efficiency, and attracting investment.
For example, in Greece, the government sold portions of public assets as part of the financial rescue program provided by the European Union and the International Monetary Fund during the country’s debt crisis in the past decade. In India, the government privatized numerous state-owned enterprises—including airlines and oil refineries—in an effort to enhance financial efficiency and attract investment.
