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Investment Minister Hassan El Khaitb will now be minister in charge of the Sovereign Fund of Egypt (SFE), according to a decision by Prime Minister Moustafa Madbouly published in the Official Gazette on Thursday that places the fund under the control of whoever is heading the Investment Ministry.
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This wasn’t the only important change made to the sovereign wealth fund over the last few days: Madbouly’s decision came alongside President Abdel Fattah El Sisi ratifying amendments to the law regulating the SFE that gave the prime minister the power to appoint the minister in charge of the fund — rather than the responsibility falling to the planning minister. Under the amendments the fund will also be directly under the cabinet’s control and deemed a cabinet-affiliated fund.
The why: The move comes alongside efforts to better align the SFE with the objectives and actions of the cabinet by placing it more firmly under its control and to boost its contribution to the country’s economic development. The importance placed on the investment minister — as opposed to the planning minister previously — also signals a change in approach to the focus of the fund being more towards attracting investment from abroad, positioning the fund to better carry out the state’s privatization program.
El Khatib has already laid out his vision on how he would run the fund: “I’m not fixated on privatization,” El Khatib said last month at the EnterpriseAM Finance Forum, explaining that he instead approaches the topic as “an investor.” El Khatib explained that instead of selling assets quickly and cheaply, “I want to talk about maximizing their value and the returns we get for them, move them to a sovereign wealth fund, have them be run by the private sector, and monetize them to generate more value.”
There’s been quite a bit of movement on the privatization front recently: The government will soon announce “important news” regarding the privatization of a number of banks and airports, Madbouly announced earlier this month. The news was quickly followed by the central bank-owned United Bank temporarily listing its shares on the EGX ahead of an IPO and unconfirmed reports of the first five airports to be included in the state’s airport privatization plans. The government is looking to raise USD 2-2.5 bn through the privatization of state-owned companies in FY 2024-2025.
