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Egypt’s SWF key issue since 2015; will be applied in Q1 of 2019 - Daily News Egypt

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Egypt’s SWF key issue since 2015; will be applied in Q1 of 2019

Chinese ambassador expressed interest to support new fund, utilising China’s expertise


Seeking to make use of its assets, Egypt has taken serious steps since April 2018 in order to establish its first sovereign wealth fund (SWF). Egypt has currently undertaken actions in order to start utilising the fund in 2019.

In this regard, responding to President Abdel Fattah Al-Sisi’s instructions, the government approved in April a draft law to establish the SWF entitled ‘Misr Fund’ with a capital of EGP 200bn, for the purpose of managing the state’s assets. The government also approved an EGP 5bn startup capital for the fund, with EGP 1bn to be immediately transferred from the treasury. The law came into effect in July, and the fund will be entirely managed by the ministry of planning.

The new fund is also expected to serve as an instrument to help decrease Egypt’s budget deficit, which slightly decreased to 1.9% in fiscal year 2018/19.

According to the Minister of Planning and Administrative Reform, Hala Al-Saeed, the law allows the fund to establish sub-funds and contribute to similar Arab funds, aiming to utilise the state-owned assets, especially the unused ones which are estimated at 3,000 units.

Since this action was taken, a unit was formed at the ministry of planning, which is responsible for following up and coordinating with other ministries and concerned bodies, in order to prepare a database of the state’s assets, particularly the unused ones.

Noteworthy, Egypt intended to establish such a fund four years ago, as it was a main issue in Al-Sisi’s presidential programme during his first term, and it is still a priority till our present day. In June 2015, Egypt’s cabinet under former prime minister Sherif Ismail, had formally approved plans for the country to establish a SWF titled ‘Amlak’ subject to the supervision of the National Investment Bank.

At that time, the former Minister of Trade, Industry and Investment, Mounir Fakhry Abdel Nour, informed Russian media that the fund will pay special attention to communications’, logistics’, and tourism’s infrastructure. Moreover, experts are mostly positive that this fund could give Egypt’s economy a much needed lift.

For the ‘Misr Fund’, Al-Saeed announced that it will play a key role in achieving sustainable development as it is considered a long term investment, adding that the Chinese ambassador in Egypt expressed China’s interest to support the new fund with his country’s expertise in establishing said funds.

As for the fund’s executive manager, it is expected that the individual’s name will be announced in March, paving the way for the fund to come into effect in the first quarter (Q1) of 2019.

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https://dailynewsegypt.com/2019/01/31/egypts-swf-key-issue-since-2015-will-be-applied-in-q1-of-2019/
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