The Egyptian Cabinet on Sunday distanced itself from a high-profile proposal to write off domestic public debt through state asset transfers, even as its architect, prominent financier Hassan Heikal, pointed out that the government recently executed the exact same mechanism in a massive state media debt settlement.
The dispute centers on the “Great Swap,” a public proposal conceived by Heikal to eliminate Egypt’s domestic debt by transferring ownership of public companies and state assets to the Central Bank of Egypt.
Responding to widespread discussion on social media, the Cabinet stated on Sunday that ideas regarding public asset swaps against local debt were previously evaluated and deemed unsuitable.
While the official statement avoided naming Heikal directly, the cabinet argued that shifting assets and liabilities between state institutions does not reduce overall state obligations, requiring instead a comprehensive strategy addressing debt structure, servicing costs, domestic liquidity, and fiscal and monetary policy.
The cabinet also explicitly ruled out any inclusion of the Suez Canal in debt swap schemes, declaring the strategic waterway off-limits to any transfers, mortgages, or property swaps due to its connection to Egyptian national security and state sovereignty.
Addressing the recent settlement between the National Media Authority, known as Maspero, and the National Investment Bank, the cabinet characterized the 88.3 billion Egyptian pound deal—where real estate assets were transferred to clear historical debt—as an isolated institutional settlement tailored to specific legal conditions rather than a repeatable model for national debt management.
Heikal pushed back against the government’s position in a statement posted on X, questioning how the strategy could be dismissed as unviable after being implemented in what he termed a “minor swap” at Maspero. He also dismissed rumors that he serves as an advisor to the prime minister, while noting that the Suez Canal Authority could easily be excluded from his framework due to its geopolitical sensitivity.
“The government applied the swap in Maspero, so I am not sure how it can be described as ‘unviable’ when it was already implemented,” Heikal wrote. “I am calling for transferring the ownership of certain public companies from the Ministry of Finance to the Central Bank. If we trust this institution with over $50 billion in foreign reserves, the entire banking system, and public deposits, can we not trust it with holding some of the country’s assets?”
Heikal emphasized that conventional economic remedies have failed to yield results. “I do not know of any country in the world where debt interest eats up 60–70% of its budget, leaving citizens without adequate social protection,” he stated. “There is no other solution for local public debt if we want citizens living in Egypt to see ‘Egypt’!”
The Maspero real estate transaction forms part of a broader government effort to resolve entangled inter-agency debts owed to the National Investment Bank. In June, the bank signed two framework agreements totaling 196 billion pounds to settle historical financial overlaps dating back to the 1980s.
Heikal, the son of the late prominent journalist Mohamed Hassanein Heikal, is a key figure in Egypt’s financial sector and former chief executive officer of investment bank EFG Hermes. He resigned from EFG Hermes in 2013 after being charged in a stock market manipulation case, of which he was later acquitted.
