Egypt defies IMF reform push with sweeping powers for military-linked economic giant

The House of Representatives on Tuesday gave final approval to legislation that transforms the Future of Egypt Authority into one of the country’s most powerful economic institutions and places it directly under the supervision of President Abdel Fattah el-Sisi.

The law significantly expands the authority’s influence over strategic sectors of the economy, giving it broad responsibilities for commodity imports, agriculture, fisheries, investment, real estate development, land allocation, licensing, asset management and revenue collection.

Its passage signals that Egypt intends to continue relying on powerful state-backed institutions to drive economic development even as international lenders push for deeper private sector participation.

From land reclamation project to economic powerhouse

The Future of Egypt Authority began in 2017 as a government-backed land reclamation initiative designed to increase agricultural production.

In less than a decade, it has evolved into one of Egypt’s most influential state institutions, steadily assuming responsibilities that extend well beyond farming into strategic sectors considered vital to national food security, investment and economic planning.

The new legislation formalises that transformation, consolidating planning, licensing, investment approvals and land management within a single entity while exempting it from several existing legal frameworks.

It also establishes two new financial vehicles, a sovereign fund known as Pyramids of the Nile and a parallel services fund, to finance the authority’s expanding activities.

Addressing parliament, Executive Director Bahaa al-Ghannam said the legislation was intended to strengthen governance and clarify the authority’s direct reporting line to the president.

He maintained that the organisation should be viewed as an incubator for investment rather than a commercial investor competing directly with private companies.

A difficult balancing act for Egypt

The legislation comes as Egypt remains under pressure to implement reforms agreed under its multibillion-dollar IMF support programme.

After a severe foreign currency shortage, soaring inflation and successive currency devaluations, Cairo secured expanded financial support from the IMF while pledging to strengthen the private sector, reduce the role of state-owned enterprises and encourage greater competition.

The IMF has repeatedly argued that companies linked to the state and the military enjoy structural advantages, including preferential access to land, tax exemptions and other incentives, that discourage private investment and distort competition.

The expansion of the Future of Egypt Authority is therefore likely to attract close attention from investors and international lenders assessing Egypt’s progress on those commitments.

Supporters of the legislation argue that centralising strategic economic functions will improve coordination, accelerate investment decisions and strengthen food and national security in a volatile global environment.

Critics, however, warn that concentrating extensive economic powers within a single state-backed institution could make it more difficult to create the competitive business environment the IMF has been advocating.

Parliament pushes for stronger oversight

The legislation was debated over two days before lawmakers approved a series of amendments aimed at increasing transparency.

Among the changes, parliament secured the right to approve the designation of development zones, expanded oversight by Egypt’s state audit agency and the legislature, and introduced limits on annual fee increases within those zones.

Lawmaker Reda Abdel Salam said roughly 80% of the provisions that had initially raised concerns were amended to improve transparency, accountability and competitive neutrality.

Not everyone was convinced.

Atef al-Meghawry argued that lawmakers had not been given sufficient time to examine the bill or consult independent experts. He also rejected the argument that exempting the authority from parts of Egypt’s legal framework would improve efficiency, warning that doing so risked undermining the broader government apparatus.

The legislation now awaits presidential ratification before becoming law.

The approval of the legislation highlights the central question facing Egypt’s economic strategy: can the country expand the role of powerful state-backed institutions while simultaneously delivering the market-oriented reforms demanded by international lenders and private investors?

As one of Africa’s largest economies, one of the continent’s biggest recipients of IMF financing and a critical gateway for regional trade through the Suez Canal, Egypt’s economic direction is closely watched by governments, investors and development partners across Africa and the Middle East.

The Future of Egypt Authority is expected to play a leading role in major agricultural, investment and strategic development projects.

Whether its expanded mandate attracts more investment or deepens concerns about competition with the private sector could shape investor confidence, influence future IMF programme reviews and determine the pace of economic reforms in one of Africa’s most strategically important economies.