The government plans to attract US$5.0 billion from offering stakes of its power plants and state-owned companies from October 2023 until the end of June 2024, according to the Cabinet’s Information and Decision Support Center (IDSC).
Specifically, shares will be offered in the Siemens Beni Suef power plant, Gabal El-Zeit wind power plant, and Zafarana wind farm, in addition to Safi and Watanya, companies owned by the military. The government plans to offer stakes in 35 state-owned companies to strategic investors by the end of June 2024, under the State Ownership Policy Document. A list of 32 companies was released in February 2023. Since then, three additional companies have been added to the list: Eastern Company; Al Ezz Dekhila; and Telecom Egypt. (ZAWYA)
Egypt’s privatisation programme remains key to unlocking FX flows as the country has faced some liquidity challenges in recent months. To recall earlier this month, Moody’s extended its review period for downgrading Egypt’s B3 long-term foreign-currency and local-currency issuer ratings. It noted that its review balances progress on the government’s privatisation, fiscal and structural reform agenda against evidence of further weakening in external liquidity through a drawdown of commercial banks’ net foreign assets at a scale that exceeds recently concluded asset sales.
Moody’s also said that sufficient confidence in the ability of the government to generate necessary foreign exchange inflows to meet increasing external debt service payments over the next two years and bolster the economy’s foreign exchange reserves, would be credit positive.
