Egypt’s sovereign wealth fund eyes food and health sub-funds

The fund will cooperate with consultants on the preparation of studies to determine the best investments

Ayman Soliman, chief executive of the Sovereign Fund of Egypt (TSFE), has revealed plans to establish four sub-funds in sectors with “significant investment opportunities” triggered by the Covid-19 pandemic.

“Sectors that attract attention of investors in the current circumstances after the spread of the coronavirus pandemic centred on medical security, food and healthcare,” he said during an online press conference.

Priority is being given to health services, pharmaceutical and food manufacturing, agriculture, financial channels and inclusion, as well as logistics and infrastructure.

The fund will cooperate with consultants on the preparation of investment studies to determine the best investment exploitation mechanism for TSFE’s assets.

Private investor contributions may reach 100%, and Soliman noted that TSFE could invest in these assets with potential investors.

“The TSFE is currently in negotiations with investors, and is looking to enter into new partnerships to exploit various state assets to achieve huge investment returns for the local economy,” he said.

Soliman explained that the partnerships the fund seeks to implement would help remove debts and financial burdens from the state budget. The strategy seeks to attract new investments into the local economy.

In May, the TSFE signed a memorandum of understanding (MoU) with New York-based Concord International Investments Group to establish a joint venture management company specialising in the healthcare sector.

This will see investments mainly in Egypt, as well as the wider Middle East and Africa (MEA) region, with fund worth $300 million.

The TSFE was established by Law No. 177/2018 to transfer ownership of unexploited government assets to the fund for development and management.

The law creating the new fund gives the TSFE the right to establish subsidiary and sub-funds alone or in partnership with Arab funds.

Soliman said details of the new funds will be formally announced during the next meeting of the Fund’s Board of Directors.