CAIRO: Amidst discussion of the benefits and challenges of international trade agreements at the annual Global Trade Matters conference, a new project was announced that will take full advantage of favorable trade terms between Egypt and the United States secured through the QIZ agreement.
Al Tajamouat Industrial City Egypt is a new project being developed by Jordan’s Al Tajamouat, which develops industrial cities and other real estate projects in Jordan, Qatar and Syria.
The development of Al Tajamouat Egypt comes on the heels of a highly successful industrial city in Jordan, active since 1994. The Jordanian facility, which exports nearly $500 million to the United States yearly through the QIZ agreement, offers client factories a one-stop shop for all their business needs, providing world-class operations facilities, support services and housing and catering services for workers.
Al Tajamouat Egypt will be structured on the same lines as the Jordanian facility and is expected to create 50,000 jobs and bring in $1 billion in foreign direct investment.
Upon its completion, the 1.1 million square meter zone is projected to have the capacity to generate close to $1 billion in exports.
Daily News Egypt met with Jansat Khansa, Al Tajamouat Egypt’s executive project director, on the sidelines of the Global Trade Matters conference to learn more about the progress of the project, the impact the project will have on Egypt’s economy, and Al Tajamouat’s plans for future expansion in the country.
Daily News Egypt: What is the vision for Al Tajamouat Egypt?
Jansat Khansa: Like Al Tajamouat industrial city in Jordan, the project in Egypt will be a full service operation providing all necessary support to the client factories. Our goal is to work with companies from the incorporation phase all the way up through beginning production on site. And we will provide all the necessary tools and know-how to make this happen; everything from engineering services to providing water, gas and health insurance options.
Another unique aspect of our vision is our commitment to providing housing and food services to workers in the city. Housing workers on-site increases productivity and allows the workers to have access to quality housing and food and take away pure income from their work.
We’ve had a lot of success with this model in Jordan and we plan to send Egyptian management to train in that facility to gain experience to apply to their work in Al Tajamouat Egypt.
How long has the project been in the works?
We incorporated in Egypt in November 2007 and signed the contract to purchase our site on the Ismailia road shortly after. Since then we have been working through all the logistical phases of the project and starting in April we started working on the infrastructure of the site.
In July we’ll begin the second phase of infrastructure work and we will proceed from there. The project will be completed in three phases and we expect to be operating at full capacity by 2015.
We’ve had lots of support throughout this process from the Egyptian government, especially from Minister of Trade Rachid Mohamed Rachid.
Why Egypt, why now?
Egypt is an ideal location to set up an industrial city for a variety of reasons.
Unlike Jordan, Egypt has a large skilled labor force and ample sources of raw materials for production. Production costs are also very low and Egypt enjoys favorable trade terms with many important markets. The companies operating in the new city will be able to benefit from all of these advantages.
In Jordan we didn’t have these advantages and the zone was a great success, so I believe the project here has great potential.
Up until now, Egypt has lacked the capacity to take full advantage of export opportunities, especially in the area of ready-made garments, and we hope that the establishment of Al Tajamouat will help unlock the potential that exists in the market right now.
What challenges have you faced?
The financial crisis delayed our plans slightly; we’d originally intended to begin in late 2008 but this got pushed back to April 2009. We will also need to invest time in promoting quality production and work ethic to make the project as successful as possible.
Since our clients will be employing Egyptian labor, we will also need to overcome cultural opposition to the idea of workers living on-site, especially for young women. We will need to reach out to the families and educate them about the living facilities and the advantages of on-site housing so that young people can take advantage of the employment opportunities the city will create.
Does Al Tajamouat intend to pursue other projects in Egypt?
We are always open to new opportunities and Egypt is a great market to explore new options. A high-end retail development might be a good option for this market, but we will keep our eyes open and see what comes along.
