• 19:08
  • Thursday ,21 March 2019
العربية

Egypts Minister of Public Business Sector promises new era in managing investments

By-Ahram

Home News

00:03

Thursday ,21 March 2019

Egypts Minister of Public Business Sector promises new era in managing investments

Speaking on Tuesday at the opening of the Portofolio Egypt 2019 conference held by private think tank Al-Mal-GTM under the title "Opportunities Blunted by Risks," Egypt s Minister of Public Business sector Hisham Tawfik promised a new era in investment for maximum returns. 

Minister Tawfik pointed out that the assets owned by the companies that fall under the ministry include real estate assets, equity owned by subsidiaries or joint ventures. 
 
He added that the ministry employs a philosophy in managing these fixed assets based on finding ways to achieve most efficient use of them; applying the concepts of "development management"; partnership with the private sector in order to transfer technology, opening new markets; and applying the idea of ​​creating demand for goods and services.
 
During his presentation, Minister Tawfik announced that a tentative agreement has been signed with the Japanese carmaker Nissan to establish a partnership with Egypt s El-Nasr Automotive Company to produce about 100,000 cars annually, with a focus on raising the percentage of the the locally manufactured component and exporting most of the product.
 
The final deal is expected to be signed in three months.
 
Unused lands
 
In terms of real estate assets, the minister explained that the ministry has identified 250 unused plots of lands at an area of 19 million metres square.
 
"These lands are now being diverted from industrial to residential use, especially if they fall within residential zones; and they will be offered to real estate developers at auctions. The payment shall be made in installments, with a deduction in the case of cash payment of cash," the minister highlighted during the conference. 
 
Tawfik explained that the sale of these lands would raise funds, provide a service to the  of community.
 
The proceeds from the sales would be used to pay the debts owed by the subsidiary companies to government agencies, which amounts to about EGP 38 billion; finance  development and restructuring process; and boost the state treasury.
 
He explained that the ministry manages 119 companies, which fall under eight holding companies subject to Law 203 of 1991, along with ownership rights in the number of 299 joint companies subject to Law 159 of 1981.
 
The minister stressed that the return on investment in its companies is being maximized, explaining that the ministry has divided its companies into three categories: profitable and ready to IPO; companies that are performing below potential and require administrative and commercial development to reach maximum capacity; and loss-making companies that are being developed technically and financially either autonomously or through partnership with the private sector.
 
The minister explained that the ministry is implementing a comprehensive plan of development in its spinning and weaving companies at an estimated cost of EGP 25 billion, aiming to eliminate the losses of these companies, which currently exceed EGP 2.7 billion, and turn profit of EGP 3 billion after 4 years.
 
Expansion of tire production and other reforms
 
The minister also said the ministry is developing its transport and engineering company to expand the production of tires through partnership with a foreign company that has technical expertise and strong connections in the global markets, with the aim of raising production capacity of tires from 50,000 to 900,000.
 
Tawfik added that the ministry has put in place a long term plan to maximize returns in its 299 joint ventures through new ways to manage investments more efficiently, and assigning financial management of IPOs to capable entities. 
 
On administrative reforms inside the ministry, Tawfik revealed that the ministry will start a program to measure the efficiency of the executive departments of the affiliated companies next week according to clear and specific criteria, as well as establishing central marketing and sales departments in the holding companies in order to strengthen sales and marketing operations of products.
 
The Minister added that after the floating of shares for Eastern Tobacco the government is planning to float shares for three more companies on the stock market as part of phase one of issuing IPOs, and is set to float shares for up to eight more companies in the financial year 2019-2020.