Private infrastructure investment ‘would release funds for Egyptian public services’

11 Dec 18

Egypt could spend billions more on education and health using its current reforms to attract more private sector finance for infrastructure development, the World Bank has said.

The country has already freed up $14bn from public coffers by reforming energy subsidies, which has reduced pressure on the national budget and allowed more investment in welfare systems.

Clive Harris, head for maximising finance for development at the World Bank, said: “Egypt can learn from global experience and gain by increasing the use of private sector finance, management expertise and innovation in commercial infrastructure and agriculture, conserving public sector resources for where they are needed most.”

According to the G20’s Global Infrastructure Outlook, Egypt will need $675bn of investment over the next 20 years to cover its infrastructure costs.

Egypt is starting to benefit from an ongoing reform programme and has seen a boost in growth, stronger public accounts and debt is falling for the first time in a decade. 

But the World Bank said to make these gains sustainable and free up money to invest in citizens and public services, Egypt needs to “broaden and deepen its reform agenda to other sectors”.

“This would be part of a fundamental shift away from the state as a provider of employment and output to an enabler of private investment; with the economy driven by a dynamic private sector generating jobs for the youth,” the bank said in a statement.

The four biggest sectors with “huge potential” for private investment are transport, energy, water and sanitation, and agriculture.

Enabling more private investment to these sectors would also generate growth and create more jobs, the bank said.

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