The Egyptian government is seeking to secure investment for a wide range “mega projects” that are either planned are underway, and officials hope that the Egypt Mega Projects Conference this month will provide the solutions.
At the beginning of 2015, the Egyptian government launched an ambitious programme to attract investors to Egypt. The first step, in March, was the largest economic promotion event in the history of Egypt: the Egypt Economic Development Conference (EEDC).
This was followed by the “Egyptian International Economic Conference of the Matrouh Governorate” in October, aimed at inviting investment in the governorate.
In between those events, President Abdel Fattah Al-Sisi held talks with major international investors around the world.
The Egypt Mega Projects Conference, to be held in Cairo on 8 and 9 December, aims to finish 2015 with a final push on encouraging large-scale investment, the aim being to attract more investors into specific sectors that require further attention.
According to government figures, a further $173bn is needed in order to meet the need for planned industrial and development projects.
Many of the projects still seeking investment are either planned or underway, their value amounting to between $370m and $412m.
Among the key sectors represented are construction, energy, chemicals, water, and industry, with a combined project value of $177.778m, according to official data.
The lion’s share of projects falls into the category of civil engineering and construction, at 55%, while transport projects account for just 9%.
The value of investments required breaks down in sectors as follows: $117.274m for construction; $36.466m for energy; $18m for gas projects; $12.4m for oil; $18.939m for transportation; $4.75m for water projects; and $1.665m for industrial developments.
However, despite the great efforts exerted by the government, numerous challenges hinder the development of current and planned projects, as well as the search for investors.
In the construction sector, there is the lack of land currently available for use, while the activities of land-brokers and auctions have pushed real-estate prices up. This is in addition to bureaucratic complications in registering land and obtaining licenses. Meanwhile, the instability of the pound has pushed up real-estate development costs.
The most common investment problems facing Arab investors pertain to questions over the ownership of land, as well as the interpretation of contracts. The issues are highlighted by the crisis of Tanta Flax, which was owned by Saudi investor Abdul Elah Kaki, the owner of Kaki Group.
The problem emerged after the 25 January revolution, when the Egyptian judiciary, issued provisions cancelling the sale of several companies during the rule of former president Hosni Mubarak. The companies, including Tanta Flax and Cemex Egypt, were returned to the state.
