DAVOS – Egypt is seeing good investor urge for food for stakes in its state-owned enterprises, the nation’s planning minister stated on Wednesday, as the federal government pursues partial privatisations to drum up funds after a pointy fall within the worth of its foreign money.
Egypt, confronted with a foreign money crunch exacerbated by the struggle in Ukraine, just lately began a $3 billion IMF programme that requires decreasing the state’s footprint within the economic system, liberalising the trade fee and rationalising spending.
It features a aim of elevating $2-2.5 billion by mid-year from gross sales earlier than any preliminary public choices on the inventory market, a goal Planning Minister Hala al-Mentioned instructed Reuters Egypt was on monitor to achieve.
“There’s lots of urge for food to the Egyptian economic system. I believe positively the inventory market is at its finest now,” she stated on the sidelines of the World Financial Discussion board in Davos.
Sectors into account embrace trade, agriculture, telecoms, she stated, with out giving any particulars of any specific firms or offers.
“We now have nice demand from completely different traders, excessive web value people, sovereign funds,” she stated.
Egypt’s essential index rose 22.17% in 2022, to its highest degree since 2017, and has risen an extra 9.51% this 12 months, based on Refinitiv knowledge.
Nonetheless, the nation has lengthy struggled to draw international direct funding (FDI) exterior its power sector, and the state has continued to play a dominant position within the economic system.
The Egyptian pound has misplaced practically half its worth since March 2021 after being allowed to devalue in jumps, and inflation accelerated to 21.3% in December, its highest for 5 years.
Following the newest sharp depreciation final week, Egypt’s central financial institution stated on Monday that international traders had transferred greater than $925 million into the Egyptian international trade market.
Egypt’s foreign money was dealing with a brief downside given the “a number of shocks” taking place globally, stated el-Mentioned.
“I believe it is a non permanent challenge and we’ve got taken already the mandatory measures within the liberalisation of the trade fee and in rationalising the international part of expenditure that we’ve got, and in addition when it comes to providing the correct funding local weather to make sure the inflow of international trade coming from FDI,” she added.
As a part of that rationalisation, she stated infrastructure tasks that incurred exhausting foreign money spending could be delayed, however not stopped, to be able to cut back international foreign money outlays.
(Reporting by Maha El Dahan, writing by Nafisa Eltahir; modifying by Aidan Lewis and Philippa Fletcher)