Egypt is expanding a model of government that concentrates regulation, commercial activity and oversight inside one institution, raising questions many African countries will eventually have to answer.
Development Diaries reports that Egypt’s parliament recently approved legislation formally expanding the military-linked Future of Egypt Authority into one of the country’s most powerful economic institutions, placing it under direct presidential oversight and giving it sweeping responsibilities across agriculture, strategic commodity imports, fisheries, real estate and investments.
The authority has evolved from a land reclamation project launched in 2017 into an institution that now plans, licenses, allocates land, manages assets, collects revenue and operates businesses in many of the same sectors it regulates.
Egypt argues that such concentration of authority allows government to deliver infrastructure faster, strengthen food security and respond more effectively to economic shocks.
Those are legitimate public policy objectives for a country of more than 100 million people facing limited arable land and repeated global supply disruptions.
The accountability problem begins when the same institution that regulates a market also becomes one of its biggest competitors.
Imagine applying for farmland from an agency that also farms commercially, or seeking a licence from an institution competing for the same customers. Losing the application may have nothing to do with unfair treatment, but proving otherwise becomes almost impossible because the regulator and the competitor are now the same organisation.
That concern has become even more significant because the new law exempts the authority from several existing laws. While details of those exemptions remain unclear, every exemption granted to a public institution automatically raises questions about whether private businesses competing in the same market continue to operate under the same rules.
The International Monetary Fund (IMF) has repeatedly urged Egypt to reduce the commercial dominance of state- and military-owned enterprises, arguing that preferential access to land, tax concessions and other advantages weaken competition and discourage private investment.
However, the government sees the same arrangement differently, with officials maintaining that strategic sectors cannot always wait for fragmented procurement processes, particularly when national food security and essential commodity supplies are involved.
Governments participate in economies everywhere. The accountability problem begins when government regulates a market while competing inside it at the same time.
Military-linked commercial enterprises already exist in several African countries, including Nigeria, Uganda, Zimbabwe, Sudan and Ethiopia. Egypt has simply developed one of the continent’s most extensive versions, making its experience relevant to governments considering similar state-led economic models.
Presidential supervision also changes the nature of accountability because institutions normally answer to laws, independent auditors and oversight bodies that survive changes in political leadership.
The people most likely to feel the effects of concentrated authority are smallholder farmers and fisherfolk who depend on access to land, licences and production opportunities controlled by public institutions. Women, who make up a significant share of Egypt’s agricultural workforce while owning comparatively little registered farmland, face even greater difficulty challenging decisions involving land allocation.
Consumers are equally affected because strategic commodity imports increasingly depend on administrative decisions rather than competitive market processes.
Egypt’s constitution commits the state to equality of opportunity and combating corruption, while the African Charter on Human and Peoples’ Rights requires public resources to be managed in the interest of the people.
The African Continental Free Trade Area is also negotiating competition rules built on the principle that state-linked enterprises should not enjoy advantages unavailable to private competitors.
Those commitments become difficult to measure when one institution writes the rules, plays the game and marks its own performance.
Egypt’s Central Auditing Organisation should publicly clarify whether it retains full authority to audit the Future of Egypt Authority, while parliament should publish the complete schedule of laws from which the institution has been exempted.
The IMF should also explain whether the legislation aligns with the competitive neutrality commitments attached to Egypt’s ongoing reform programme.
For governments across Africa, Egypt offers an opportunity to decide whether faster delivery should come at the cost of independent oversight, because when government begins competing with the citizens it regulates, accountability becomes much harder to find.
