{"id":582098,"date":"2023-02-13T00:00:00","date_gmt":"2023-02-13T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/02\/13\/mps-still-balk-at-the-liquidation-of-state-owned-zombiecos\/"},"modified":"2023-02-13T00:00:00","modified_gmt":"2023-02-13T00:00:00","slug":"mps-still-balk-at-the-liquidation-of-state-owned-zombiecos","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/02\/13\/mps-still-balk-at-the-liquidation-of-state-owned-zombiecos\/","title":{"rendered":"MPs still balk at the liquidation of state-owned ZombieCos"},"content":{"rendered":"

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<\/span>Public Enterprises Minister defends privatization plans + more overpopulation <\/span>talk in the House: <\/span>Public Enterprises Minister Mahmoud Esmat was in the hot seat in the House of Representatives yesterday, defending the liquidation of some unprofitable publicly owned companies \u2014 a long-running point of contention between the government and some opposition MPs. The House Health Committee also met to discuss the country\u2019s rising population. <\/span><\/p>\n

State-owned companies need private money to turn them around<\/span>, MPs said. \u201cThe problem with public enterprise companies is that they need huge investments to get out of their chronic financial, technical and management problems,\u201d Esmat said. Many state-owned companies are overstaffed, have dilapidated machinery, high debt levels, and lack of working capital, he said. Public firms in the pharma, automotive, fertilizers, and petrochem industries need \u201chuge investments \u2026 to be upgraded and streamlined,\u201d a problem that the new state ownership policy attempts to address by attracting fresh investment from the private sector, he said. <\/span><\/p>\n

MPs point to two cases where they think fresh investment will make a difference: <\/span>El Mahalla Spinning and Weaving Company will hit its full production capacity in the second half of 2023 after some EUR 540 mn was invested to upgrade its operations. \u201cWe are also working hard to put the <\/span>Talkha fertilizers company<\/span> in operation after a two-year suspension and in partnership with the private sector,\u201d Esmat said. <\/span><\/p>\n

OUR QUESTION- What do you do with chronic lossmakers in which no private investor will ever take a stake? <\/span><\/p>\n

Most MPs are fine with partial privatization \u2014 but some still can\u2019t stomach liquidation of loss-making state firms:<\/span> There is \u201cagreement among MPs\u201d that the ministry should stop closing and liquidating state-owned firms, said Rep. Moataz Mahmoud, who heads the House Industrial committee. \u201cWe support that these companies reach partnerships with the private sector as a new policy for upgrading performance and injecting investments,\u201d he said. \u201cBut at the same time we reject the ministry resorting to the option of liquidating or closing any of the affiliated companies.\u201d <\/span><\/p>\n

OUR TAKE- If it cannot find a willing private-sector buyer, the Madbouly government needs to hold the line and close down moribund companies <\/span>that continually deliver losses. Yes, that will mean the loss of jobs \u2014 but reskilling programs for those unable to find new work are a vastly better investment of public funds than Nasserist corporate welfare. <\/span><\/p>\n

Some opposition MPs have long <\/span>signaled dissatisfaction<\/a><\/span> with the Public Enterprise Ministry for liquidating loss-making companies.<\/span> They were <\/span>hoping for a change of heart<\/a><\/span> on the liquidation of financially moribund El Nasr Coke and Chemicals after Mahmoud Esmat last August took the reins of the ministry from Hisham Tawfik, who had been <\/span>repeatedly criticized<\/a><\/span> over his stance on privatization and liquidation as he worked to streamline the ministry\u2019s portfolio.<\/span><\/p>\n

MEANWHILE- MPs also called for more clarity on the <\/span>state ownership policy<\/a><\/span>, which lays out the government\u2019s privatization roadmap. <\/span><\/p>\n

HOUSE HEALTH COMMITTEE TALKS OVERPOPULATION-<\/span><\/p>\n

Legislation is not the solution to overpopulation:<\/span> It would be \u201cquite difficult\u201d to pass laws in <\/span>Egypt aimed at curbing population as seen in countries including China, Singapore and Vietnam, National Population Council head Tarek Tawfik told the House Health Committee yesterday. Our population is expected to reach 157 mn people in 2050 and 205 mn by 2100, he added.<\/span><\/p>\n

REMEMBER-<\/span> The government is <\/span>reportedly looking at<\/a><\/span> introducing incentives for families who commit to having no more than two children in a bid to control a population surge. Egypt\u2019s population has now surpassed 104.4 mn, increasing by 1.6 mn in 2022 alone, according to <\/span>data<\/a><\/span>by official statistics agency CAPMAS. <\/span><\/p>\n

FAST FACT- We\u2019re one among the eight nations that will deliver more than half of world\u2019s projected increase in population through 2050<\/span>, according to UN forecasts released <\/span>last year<\/a><\/span>. <\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Public Enterprises Minister defends privatization plans + more overpopulation talk in the House: Public Enterprises Minister Mahmoud Esmat was in the hot seat in the House of Representatives yesterday, defending the liquidation of some unprofitable publicly owned companies \u2014 a long-running point of contention between the government and some opposition MPs. The House Health Committee […]<\/p>\n","protected":false},"author":1,"featured_media":582099,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7344],"tags":[72,274,187,2262,359,79,587],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-582098","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legislation-watch","tag-enterpriseam","tag-house-of-representatives","tag-legislation-watch","tag-mahmoud-esmat","tag-population-growth","tag-public-enterprises-ministry","tag-state-privatization-program","wpautop","entry"],"acf":{"mongo_id":"ccb15edd-cf53-46f2-9554-b7a42137cce3","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2022\/10\/House1600.jpg","photo_position":"below","homepage_title":"","full_issue_title":"","related_issue":[582090],"teaser":"","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2023\/3\/.af8628df-b89b-4aee-82f5-3748e4f7ae89.mp3"},"yoast_head":"\nMPs still balk at the liquidation of state-owned ZombieCos - EnterpriseAM Egypt<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterpriseam.com\/egypt\/2023\/02\/13\/mps-still-balk-at-the-liquidation-of-state-owned-zombiecos\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"MPs still balk at the liquidation of state-owned ZombieCos\" \/>\n<meta property=\"og:description\" content=\"Public Enterprises Minister defends privatization plans + more overpopulation talk in the House: Public Enterprises Minister Mahmoud Esmat was in the hot seat in the House of Representatives yesterday, defending the liquidation of some unprofitable publicly owned companies \u2014 a long-running point of contention between the government and some opposition MPs. 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