Minister of Planning Ashraf El-Araby revealed that the government will establish a sovereign wealth fund to invest in infrastructure.
The fund will be owned by the state with subsidiaries funds for different sectors, including agriculture, electricity, and industry. A number of Arab investment funds will participate with 50%.
Egypt launched its sustainable development strategy for 2030 in February. The strategy governs the economic development plans to achieve sustainability in partnership with the private sector and civil society, as well as many international organisations operating in Egypt, El-Araby said.
The government is serious about promoting investments and meeting the challenges to national security, as well as the high population growth rate, which is four times more than that of China, the minister added.
El-Araby explained that Egyptians live on 7% of Egypt’s total area, which represents another challenge, especially when put in the context of the slowing economic growth. However, the government aims to reach an economic growth rate of 6% by 2018, according to the minister.
The unemployment rate stands at 12.8% and 30% among youth.
The government is working to establish a consulting entity for major projects carried out by the state, El-Araby said, adding that the National Investment Bank (NIB) has already established this entity and will announce its details in the coming period.
El-Araby believes that improving the investment climate requires solving many obstacles, including the provision of energy and land, as well as licences and permits, which the government has been trying to solve by enabling investors to obtain them by notification.
The minister emphasised that Egypt has dozens of investment opportunities, which will be put forward for participation in the private sector, in the coming period.
El-Araby explained that management should be in the hands of the private sector for its experience in investment, while the role of the public sector should be limited to regulation and supervision.
The construction sector is one of the most important sectors leading economic growth, and the government is adapting a growth strategy that will achieve a boost in growth in parallel with social justice, he explained.
The government will complete 600,000 social housing units before June 2016.
El-Araby named a few projects, on which the state will rely during the coming period, including the New Suez Canal, the Golden Triangle, the New Administrative Capital, development of the north-western coast, and the 1.5m feddans project.
He admitted to the failure of the subsidies policy, saying that the role assigned to them has not been fulfilled. He noted that the subsidies allocations have been increasing over 30 years, accompanied by increases in poverty rates.
“The poor did not benefit from the system,” he said.
He explained that the government will turn to cash subsidies, raise economic efficiency, and maintain affordable prices to counter the declining quality of services provided.
“The prime minister said that 20% of the budget is allocated for investments and improving services,” El-Araby said.
Al Mal GTM’s Government Business Dialogue Conference 2016, entitled “How Investment Is Driven”, began on Monday under the auspices of Prime Minister Sherif Ismail. The two-day conference will include sessions on macro-economic, investment, finance, industry, real estate, tourism, energy, trade, and transport, along with a number of speeches to be given by senior officials and investors.
Over 500 government officials and leading businessmen will flood to the Cairo Marriott Hotel to attend the conference, including El-Araby, Minister of Housing Mostafa Madbouly, Minister of International Cooperation Sahar Nasr, Minister of Electricity and Renewable Energy Mohamed Shaker, Minister of Trade and Industry Tarek Kabil, Minister of Telecommunications Yasser El-Kady, Minister of Supply Khaled Hanafy, and Sherif Fathy for the Ministry of Civil Aviation.