Al-Sisi reviews Egypt's food security, strategic commodity reserves    Egypt signs strategic agreements to attract global investment in gold, mineral exploration    Syria says it will defend its territory after Israeli strikes in Suwayda    Egyptian Exchange ends mixed on July 15    Suez Canal vehicle carrier traffic set to rebound by 20% in H2: SCA chief    Tut Group launches its operations in Egyptian market for exporting Egyptian products    China's urban jobless rate eases in June '25    Egypt's Health Minister reviews drug authority cooperation with WHO    Egypt urges EU support for Gaza ceasefire, reconstruction at Brussels talks    Pakistan names Qatari royal as brand ambassador after 'Killer Mountain' climb    Health Ministry denies claims of meningitis-related deaths among siblings    Egypt, Mexico explore joint action on environment, sustainability    Egypt, Mexico discuss environmental cooperation, combating desertification    Needle-spiking attacks in France prompt government warning, public fear    Foreign, housing ministers discuss Egypt's role in African development push    Korea Culture Week in Egypt to blend K-Pop with traditional arts    Egypt, France FMs review Gaza ceasefire efforts, reconstruction    CIB finances Giza Pyramids Sound and Light Show redevelopment with EGP 963m loan    Greco-Roman tombs with hieroglyphic inscriptions discovered in Aswan    Egypt reveals heritage e-training portal    Three ancient rock-cut tombs discovered in Aswan    Egypt condemns deadly terrorist attack in Niger        Sisi launches new support initiative for families of war, terrorism victims    Egypt's GAH, Spain's Konecta discuss digital health partnership    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Egypt's Irrigation Minister urges scientific cooperation to tackle water scarcity    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    Egypt's Democratic Generation Party Evaluates 84 Candidates Ahead of Parliamentary Vote    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Cabinet approves establishment of national medical tourism council to boost healthcare sector    Egypt's PM follows up on Julius Nyerere dam project in Tanzania    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Government promotes public-private partnerships
Published in Daily News Egypt on 18 - 09 - 2012

Driven by the current financial shortfall, the Egyptian government has begun discussions regarding prospective public-private partnerships (PPP). According to officials, PPP are intended to catalyse infrastructure development, of which the country is in desperate need.
The Ministry of Finance launched the MENA Project Finance and PPP two day conference yesterday, under the patronage of Prime Minister Hesham Qandil, delineating the government's short, medium, and long-term economic outlook.
“This conference summarises, in a simple manner, the Egyptian government's social and economic philosophy," said Minister of Planning and International Cooperation, Ashraf El-Arabi.
The Egyptian government's new approach to bolstering infrastructure development and attracting more investments is premised on the concept of partnership between the private and public sector. “For a period of time, we relied excessively on the public sector, and for another period we reversed to private sector without setting the proper rules and regulations," El-Arabi said. He added that relying solely on either and ignoring the other is bound to backfire, asserting that “only the collaboration between the two sectors could guarantee the achievement of economic growth as well as social justice."
“The government may possess the capital, but it might not be the best manager for such capital," noted Minister of Finance Momtaz El-Saeed.
He added that the exhausted state coffers cannot afford the state budget's expenses; “it can only cover from 65 to 70 per cent of the budget's expenses."
The private sector has many advantages as opposed to the public sector; it is more flexible, swifter and more technologically innovative, said Minister of Investment Ossama Saleh.
A PPP is a contract between a public sector authority and a private sector party, where the latter provides a public service or carries out a project, assuming financial, technical, and operational risk. “The private sector is much more efficient than the public sector if regulated properly," said Atter Hannoura, Director of PPP Central Unit at the Ministry of Finance.
Two main technical aspects should be addressed before carrying out any project under the PPP system, Atter explained. The first aspect of any pre-feasibility plan is called public sector vomparator, which measures the cost of the service provided by the private sector to ensure it doesn't exceed a certain benchmark set by the public sector. It also involves reviewing the cost of construction, operation as well as the quantification of financial risk. The second technical aspect defines the structure of the project itself, what Atter dubbed as ‘risk allocation' or the bankability of the project.
“Up to 15 projects are currently under PPP pre-feasibility studies," Atter stated. These projects include infrastructure development projects including the Safaga Industrial Port, Rod El-Farag corridor, Shoubra-Banha highway, Ain Shams-10th Ramadan railway. The government is also planning projects in the fields of education such as the Nile schools as well as other medical projects.
Saleh referred to what he labelled a “tranquil transition to democracy" as a pre-condition for the success of the government's plans. Egypt faces onerous challenges including the budget deficit, balance-of-payment deficits, and rising unemployment. “The government needs to employ its full potential in order to meet these challenges," Saleh said. However, he noted that the government has no “magic stick" to solve all problems all at once.
El-Saeed disclosed that the government plans to increase investment to reach EGP 276 billion to achieve a growth rate of four to 4.5 percent during the 2012/2013 fiscal year. He added that, in the long-term, the government targets a seven to 7.5 percent growth rate in order to create the 750,000 jobs the country is in need of annually. In the same respect, El-Arabi referred to the utmost importance of boosting direct investments, asserting the correlation between investment rate and growth rate. “The current investment rate stands between 15 and 16 per cent, which is very low," El-Arabi clarified, adding that the government aspires to boost this ratio to 65 per cent.


Clic here to read the story from its source.