26 companies make up 90% of public sector losses

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Sun, 30 Sep 2018 - 08:57 GMT

FILE - Minister of Public Business Sector Hesham Tawfik

FILE - Minister of Public Business Sector Hesham Tawfik

CAIRO – 30 September 2018: Delta Company for Fertilizers and Chemical Industries sustained losses in the value of LE 712 million ($40 million) as it started to collapse in 2011 “for unknown reasons,” Minister of Public Business Sector Hesham Tawfik announced in a press conference on Saturday.

The minister added that the company will be subject to reform procedures to ensure that it is generating profits. They also target increasing the establishment’s production from 300 tons to 1,200 tons a year.

Tawfik added that reform plans will be assigned to consultancy offices through tenders since 90 percent of the losses incurred by the public sector are concentrated in 26 companies. Tenders will be invited in a week with the aim of finishing reforms in a year and a half.

The decision of hiring consultancy offices is made after millions of pounds have been spent on reform attempts set by each company’s administration without any significant results.

The minister asserted that energy prices are not an acceptable excuse for the losses of the Delta Company since the company has an agreement that provides it with gas in reduced prices in return for supplying 55 percent of its production to agricultural cooperatives.

Tawfik explained that some other companies supply 80 percent of their output to those cooperatives and make profits.

The Chairman of the Chemical Industries Holding Co. Emad El Din Mostafa said that two plants have been shut off because of emissions and that they are being currently renovated. Tawfik said that all new plants will be built in industrial zones.

The minister has already visited six companies and will visit 10 others of those making losses in October. He added that there is a joint cooperation with the Ministry of Agriculture to resolve the fertilizers’ black market issue declaring that an announcement on the matter will be issued soon.

The problem rose due to the discrepancy in fertilizer prices as the global market value per ton is LE 5,000 while public sector companies supply half of their production for LE 3,690 per ton.

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