Egypt overhauls its prisons with eye on monetising assets

The vast prison complex in the leafy neighbourhood of Maadi in southern Cairo is so close to Mohamed Rushdi's home of 50 years that he can see its wall from his bedroom window. The stunning green surroundings and quiet streets do not invite comparison with the crowded, gridlocked and polluted neighbourhoods in some other areas of Egypt's capital, and the Tora Prison wall is an eyesore for Mr Rushdi. He has long wished the entire compound would be relocated. “I’m really happy they have finally started moving prisoners to their new location," Mr Rushdi, a 69-year-old retiree, told The National . "Don’t get me wrong, it’s not because of the people detained there, but imagine how this land could develop in the near future.” According to the Egyptian Ministry of Interior, some prisons in the Tora complex will be closed, along with about 11 more across the country, after Cairo inaugurated a new prison in the desert of Wadi Al Natrun in the north in October. The ministry said it wanted to replace the damp, poorly ventilated and dark cells at Tora with prisons that have sports grounds, hospitals and vocational training centres to rehabilitate prisoners. Another goal is part of an ambitious asset-monetisation scheme by The Sovereign Fund of Egypt. It has decided to repurpose old buildings and reshape vital areas in Cairo by creating luxury apartment buildings, high-end restaurants and cultural centres, as well as setting the stage for a regional hub for start-ups. The changes have already begun, with the colossal Mogamaa El Tahrir building in the Cairo city centre. It was a symbol of red tape as the headquarters of offices for nearly all government institutions. Several investors are competing for the new development project. Established in 2018 to help the government carry out its economic reforms, TSFE seeks to raise $2.5 billion by the end of 2022. “Making the best of the underutilised state assets would be the best long-term prescription for the state’s fiscal ailments. At this time of fiscal distress, all available options should be explored by the government,” said Adel Beshai, professor of economics at the American University in Cairo. The fund’s officials have said it helps unlock the potential of former state monopolies and opens markets to competition. Speaking to the Egyptian YouTube channel Economy Plus, the fund's chief executive Aymen Soliman denied that it was planning to auction off its assets, but will revitalise the private sector to invest in major industries such as telecoms, education and health care. Mr Soliman, an AUC-educated financial expert who managed dozens of major companies in diverse sectors, rejected speculation that the projects were aimed at providing a quick fix to the budget deficit or the handling of public debt. Sceptics have claimed that the government was trying to plug holes in its annual budget deficit or use the fund’s revenues to service interest payment on several loans from international banks to finance mega projects including the Dabaa Nuclear Power Plant, solar power stations and an entertainment district in Egypt’s new administrative capital. In its latest review on Egypt, the World Bank said the country's macroeconomic environment has shown resilience in the face of Covid-19. But it shed light on persistent challenges, including the ratio of public debt to gross domestic product, which remains high at 87.5 per cent. For Mr Rushdi, the resident of the affluent Maadi suburb and a former logistics manager at a silica sand factory, the perks of developing the Tora prison area were just too good to pass up. A proud Maadist, as many of the residents who have put down roots in the region call themselves, he said the new development plans would result in more amenities for future generations, such as schools, fitness centres, swimming pools and chic cafes. “We aren’t talking here about gentrification," he said. "Maadi already has some of the bests clubs, schools and facilities in Cairo, but we see this as an overdue extension with sleek and high-end skyscrapers, while the old Maadi keeps its character. “We want pet spas here,” he said half-jokingly. The prime location of the Tora prison is enough in itself to lure investors. It’s less than 2 kilometres from the east bank of the Nile, a 30-minute drive with congestion to central Cairo, and the neighbourhood is connected to a ring road. Maadi also has excellent infrastructure. Beyond this, the appeal to investors includes less suffocating air pollution and noise. The current exchange rate from the US dollar to the Egyptian pound also works in favour of foreign buyers. Back at Wadi Al Naturn, the new location of the prison complex, prisoners will be waiting anxiously for the next family visit. But it will be a long and more stressful journey this time, and many families will not be able to make it. Before, they were only a few bus or metro stops away from the Tora prison, said George Ishaq, a member of the National Council for Human Rights. “Now, they will be about 200km away from their loved ones behind bars," he said. "Many of the families are destitute, with no money or cars to make it. They can’t afford renting expensive cars with drivers. They already financially struggle to buy them food and cigarettes."

Egypt overhauls its prisons with eye on monetising assets

The government has ambitious plans to repurpose state assets including prisons