Egypt's wealth fund TSFE aims to raise $2.5bln for development projects

The fund is looking to forge public-private partnerships emulating state-owned investors in other emerging economies such as India and Indonesia

  
Image used for illustrative purpose. Cairo Skyline along Nile River. The bridge, the Nile river & the Corniche Street in central Cairo.

Image used for illustrative purpose. Cairo Skyline along Nile River. The bridge, the Nile river & the Corniche Street in central Cairo.

Getty Images

Egypt's sovereign wealth fund seeks to raise $2.5 billion by end of 2022 to invest in a range of economic and social development projects, from education to utilities, according to The Sovereign Fund of Egypt (TSFE).

The Egyptian fund is looking to forge public-private partnerships emulating state-owned investors in other emerging economies such as India and Indonesia, according to a report published by Global SWF, a consultancy and data provider focused on sovereign wealth funds and public pension funds.

"The Fund aims to raise its investment portfolio to EGP30-40 billion ($2-2.5 billion) by end-2022 and reaching EGP200 billion ($12 billion) within a decade with an ultimate target of EGP1 trillion ($64 billion)," said Ayman Soliman, the director-general of TSFE.

The growth strategy of TSFE is based on partnering with the private sector to generate income from state assets, he added.

This week, TSFE announced plans to raise $2.5 billion to build 17 solar-powered desalination plants to supply drinking water by 2025, in order to counter the depletion of freshwater resources due to drought and the damming of the Nile in Egypt, Global SWF reported citing the fund. 

"A call for investment partners in the water utility projects will be made in Q1 2022," said Soliman, adding that the projects will increase water desalination capacity from approximately 830,000 cubic metres per day to more than 3.6 million cubic metres.

To boost the educational standards of the country's human capital, TSFE established Lighthouse Education platform last month with a target capital of EGP1.75bn ($111 million) in partnership with Banque Misr, the Misr Insurance Holding Company, and the Suez Canal Bank, it said.

In a bid to attract foreign capital for localization of industry through joint ventures, TSFE initiated a partnership between Egypt's National Egyptian Railway Industries Company (NERIC) and South Korea's Hyundai Rotem to manufacture metro cars and electric trains in Egypt, said the statement..

In the continuation of its PPP strategy in Q4 2021, TSFE is set to offer stakes in the Wataniya Petroleum Company and Siwa-based National Company for Producing & Bottling Natural Water - Safi, which are affiliated with the Egyptian Armed Forces’ National Service Products Organization (NSPO), Global SWF reported, adding, TSFE aims to acquire a minority stake in a PPP with foreign investors.

Media reports say the Emirates National Oil Company Group (ENOC), the Abu Dhabi National Oil Company (ADNOC), Saudi Arabia’s Petromin Corporation, and Egypt’s Qalaa Holding have submitted offers to purchase a majority stake in Wataniya Petroleum, which owns a national network of 255 petrol stations. TSFE aims to offer investors 10 of NSPO’s portfolio companies, covering diverse sectors such as food production, petrochemicals, and construction.

Seeded with under-utilized state assets, TSFE was established with a mandate to advance the government’s ambitious Vision 2030 economic program with joint investments with international institutional investors. The development of “sub-funds” around development themes is central to the strategy to attract domestic and international capital.

(Writing by Syed Atique Naqvi, editing by Seban Scaria)

 seban.scaria@refinitiv.com

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© ZAWYA 2021


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