You are currently viewing The New Law encouraging Public-Private Partnerships

The New Law encouraging Public-Private Partnerships

  • Post last modified:

The private sector’s role is significantly noticeable in the Egyptian market, specifically in projects in the fields of infrastructure, energy, healthcare, and communications. Its significance has been further supported by the approval of the Parliament on 15 November 2021 of amendments to the Law on Private Sector Participation in Infrastructure and Public Services and Utilities Projects, more commonly known as the Public Private Partnerships (PPP) Law No. 67 for the year 2010 (the “Amendments”). The Amendments have been promulgated as Law No. 153 for the year 2021 published in the Official Gazette on 18 December 2021.

We will delve into the key highlights of the Amendments, as follows:

Formation of a New Reviewing Committee

According to the Amendments, a new committee including experts from the Ministry of Finance, the Ministry of Planning and Economic Development and the PPP Central Unit, along with other experts from relevant authorities, will be formed to review and decide whether potential projects submitted by governmental authorities as part of their annual plans are suitable to be implemented pursuant to a PPP. This screening process is expected to provide more scrutiny over potential PPP projects that will be included within the State’s budget in order to ensure a higher rate of the project’s success.

New Procurement Methods

Pursuant to the Amendments, the procurement methods for PPPs have been expanded to include limited tenders and bids and direct contract, depending on the nature of the project and its economic and social circumstances, provided the required approvals are obtained for the method of procurement to be implemented. The Amendments have also introduced a novel method of procurement by allowing the private sector to take the initiative to directly present new projects and submit unsolicited offers.

Market Reaction

The public sector sees the Amendments as an opportunity to facilitate procedures for the inclusion of the private sector in national projects concerning infrastructure and will help the Government reach its goals. The Chairman of the budget committee of the House of Representatives, Fakhri El-Fiqi, remarked that the Amendments will help simplify procedures required for awarding project contracts and eliminate administrative obstacles, which will facilitate the private sector’s ability to tap into the field of mega projects. He added that the value of infrastructure projects in Egypt reached EGP 6 Trillion over the last six years and is expected to double in the next few years.