Sep 18, 2019

CAIRO — Egypt is expanding its use of no-bid sale, lease and licensing of state-owned property to investors, companies and even private citizens, raising concern among human rights activists and public affairs observers who believe the decision opens up the possibility of corruption and favoritism.

Prime Minister Mustafa Madbouly issued a decree effective Aug. 31 allowing the disposal of state-owned property by government agencies by direct agreement, saying the action aims to meet the social and economic requirements of the public interest.

The decree stipulates that agencies must justify requests to use the no-bid process, showing "urgent need." They also must verify that a buyer has the necessary financial and technical wherewithal for the purchase, as well as a good reputation.

Abdel Khalek Farouk, director of the Nile Center for Economic and Strategic Studies, told Al-Monitor the decree could significantly abet corruption and favoritism by circumventing the normal bidding process.

“This usual legal method provides for a fair amount of transparency in the process of choosing one company over the other," requiring the government to select the best deal at the best price, Khalek Farouk said, adding, "This aspect is not available in the allocation by the direct agreement method, due to the increased likelihood of some government officials being linked to a certain company and favoring it over others, which kills the process of free competition.”