CAIRO: Egypt’s approach to finalizing the second phase of the road map (the presidential elections) increases hopes of restoring the previous rates of economic growth and reviving the ailing economy, Prime Minister Ibrahim Mahlab said Tuesday.
In his speech at the IPO Egypt conference organized by the Egyptian Exchange (EGX) in Cairo, Mahlab urged companies to offer their shares in Egypt’s stock market, noting that the government is working on improving the public sector performance and increasing its efficiency through professional management and separating management from ownership.
IPO Egypt aims to spur investors and owners of company businesses to receive the necessary financing for their expansion plans by listing in the EGX.
“EGX managed to provide 2 billion EGP for the listed companies during the first quarter of this year and 5 billion EGP for 4 months…It will also play a significant role in financing the Suez Canal Development project,” said Mahlab.
Mahlab further noted that IPO Egypt comes amid significant steps to implement the government’s efforts to establish a “strong” and “promising” economy.
During the event, Mahlab witnessed the signing of a memorandum of understanding between EGX and the Ministry of Transportation, with the aim of promoting transportation national projects through offering IPOs in the stock market.
“Transportation projects require massive finance resources besides that provided from the state budget, external loans and grants, leading the ministry to work on generating new sources to finance its projects including IPOs,” said Minister of Transportation Ibrahim el-Demeiry.
“We will consider launching a number of projects for IPOs, headed by the High-Speed Train project, through the ministry’s supreme committee for investment along with experts specialized in this area,” added Demeiry.
The state tends to broaden ownership of public projects by offering such projects in the stock market, so as to utilize funding potentials without bearing additional cost like banks, said the minister.
Reiterating the EGX’s significant role in attracting new domestic and foreign investment to the Egyptian market, Minister of Investment Mounir Fakhry Abdel Nour said EGX is not a mirror reflecting Egypt’s current economic situation as much as indicating investors’ future outlook.
“These indicators clearly reflect the EGX’s remarkable progress recently in boosting its legislative and regulatory structure, in addition to promoting its position among emerging markets,” said Abdel Nour.
Head of EGX Mohamed Omran urged state-owned companies and national projects to take advantage of the booming stock market by launching their projects for IPOs to get the required financing to implement such projects.
During the first four months of 2014, EGX investors offered a total of 5 billion EGP finance to the listed companies, said Omran, who considered this record a clear sign of growing confidence in Egypt’s economy.
“This is a high record which is likely to edge up while completing the road map,” added Omran.
Further, Minister of Communication and Information Technology Atef Helmy reviewed the ministry’s strategy for 2020 and the national projects launched recently, including the internet broadband, smart villages, electronic manufacturing and outsourcing.