Hisham Tawfik, the Egyptian Minister of public business sector, announced during an interview with Bloomberg that the government has suspended the privatization of state-owned companies due to ‘unfavorable’ market conditions stemming from the coronavirus pandemic.
Through its privatization program, the government wanted to reorganize an oversized and loss-making public sector to revive the economy marked by years of crisis. Twenty companies were targeted by the strategy in various sectors, including finance and agriculture.
Since the beginning of the crisis, the government has multiplied large-scale measures to mitigate economic impacts. After announcing in early April a EGP100 billion ($6.3 billion) plan which should be supported in particular by loans from international financial institutions such as the IMF and the World Bank, the authorities have indicated that 1% of the net income of civil servants would be injected in the fight against the coronavirus, which has already affected 65,188 people in the country.
According to the European Bank for Reconstruction and Development (EBRD), the country’s growth could fall to 0.5% this year, from about 5.6% in 2019.
Credit: Ecofin Agency