The Egyptian government has decided to cancel privatization of the business sector since companies sold to private owners show serious stages of neglect. Although the government does not want to re-nationalize companies that were sold at potentially below-value prices, there is a recent movement to review the prior governmental sales contracts.
Dr. Ali Assilmi, vice president of political affairs and supervisor of the business sector announced that the cancellation of the privatization law is unfair. As for nationalization, Ahmed Borai, minister of the workforce and immigration, said the idea would negatively impact the investment climate in Egypt and give businessmen a bad impression.
According to Borai, the government should implement measures to encourage much needed investment. He confirmed that current private businessmen have taken advantage of their employees, including firing current employees, lowering salaries, and denying health insurance. However, Borai says these drawbacks can be overcome by the proper application of the Labor Law Number 12 of 2003.
Privatization is the transfer of ownership or management of a governmental economic entity either partially or completely to the private sector. The reverse is nationalization.
Pure privatization is an economic perception that aims to use human and natural resources as efficiently as possible through market liberation and minimal government intervention. Its political perspective calls for reducing the role of the State and limiting it to issues such as defense, internal security, the judiciary and social services.
Source: www.yallafinance.com
