Public enterprise reform and privatization in Egypt

Abstract

The move towards public sector reform (PSR) in Egypt was a long and hesitant process ever since the major nationalization drive in the early sixties. It dates from the late 1950's when an ambitious industrialization program was initiated. In 40 years, economic and public sector management went through four distinct stages .These stages correspond closely to the evolving political outlook of the country. The first period extended from late 1956 to mid -1961. It was characterized by tentative government intervention under a free-market orientation. The second stage covered about 13 years (1961-74) in which the public sector was given dominance under a socialist umbrella. The third stage extended from 1974-1989 where the private sector was given a chance to play a parallel albeit increasing role in a more favorable political environment but under de-fact leadership by the Public Sector. The final stage started with the recognition of the severity of the imbalances and the start-up of the first Economic Reform and Structural Adjustment Program (ERSAP) in 1991. We shall follow the various attempts of PSR before 1991 in this section and then discuss in more detail public sector reform under ERSAP in section II.