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The International Finance Corporation (IFC) will advise the government on its ongoing privatization efforts under a transaction advisory agreement signed yesterday, the multilateral lender (pdf) and the cabinet said in separate statements. Signed by International Cooperation Minister Rania Al Mashat and IFC Managing Director Makhtar Diop, the agreement will enable the government to receive “technical assistance and advisory support” from the IFC, which will develop a strategy for selling down state assets.
On the IFC to-do list: The agreement will see IFC get involved in developing a strategy and implementation plan, preparing and restructuring assets ahead of sales, improving corporate governance, and implementing approved transactions, Prime Minister Moustafa Madbouly saidyesterday.
What’s next? “We will be closely monitoring the progress of this agreement with the prime minister’s office and with Minister Rania Al Mashat because we believe in the potential of transforming the Egyptian economy and really taking it to the next level,” Diop told Enterprise yesterday on the sidelines of the signing ceremony.
Some USD 2 bn in the pipeline?The IFC will help the government attract USD 2 bn in private investment to the country “over the coming years,” with some of that coming from its own funds, Al Mashat said, without providing further details.“We expect to be attracting large amounts of investments including from the IFC as we intend to double our commitment for next year in support of the government’s strategy,” Diop told us.
They’ve done it before, they can do it again:The IFC has a history of assisting governments globally in attracting private sector investments in state assets, the statement reads, adding that it has successfully facilitated asset monetization transactions for state-owned companies in countries including Kenya, Brazil, Cameroon, and more. “Our appointment as strategic advisor to support the sale and monetization of state assets will further unlock the potential of the private sector to build a sustainable, resilient, and inclusive economy for Egypt,” said Diop.
The hope is that the agreement with Egypt can be a model that can be replicated across other emerging markets, Diop said.
Part of a wider framework: The agreement “is the first operation to be signed under the recently launched 2023-2027 Country Partnership Framework with the World Bank Group, specifically supporting the government’s [state-owned enterprise] reform agenda and harnessing private capital,” Al Mashat said.
A meeting with the president:Diop sat down with President Abdel Fattah El Sisi and Al Mashat to discuss the implementation of the state privatization program, Ittihadiya said in a statement.
