North coast issue revisited … again

09-09-2018 09:00 AM

Youssef Sidhom

Youssef Sidhom

Problems on hold

The southern Mediterranean coast that forms Egypt’s northern border stretches some 1000 kilometres long and forms Egypt’s northern coast. But a specific portion of it that runs west of Alexandria and until Egypt’s westernmost point at Salloum, some 500 kilometres, boasts beaches of unparalleled pristine waters and natural beauty, and has become famous as “The North Coast”. This stretch now teems with beach resorts that are especially busy all summer.
Those who headed home from the North Coast last weekend could not have failed to notice the dense traffic heading away from the coastal area as the summer holiday season came to near-end. It is back to work, and would very soon be back-to-school and back to university. The busy traffic heading to the North Coast early summer has now reversed. Even those few who can afford to remain there longer, for the mellow September and October weather, realise this would not be easy since their beloved holiday site would no longer be guest-friendly. Daily commodities and basic services become scarce owing to largely reduced demand once the majority of holidaymakers leave. The North Coast becomes a living testimony to the Egyptian folk saying: “a paradise without people is not worth living in”.
The enchanting paradise that is the North Coast with its natural beauty, turquoise blue water, white sands, refreshing breeze, and mellow weather year round, in addition to its well-panned resorts, roads, and infrastructure, is inhabited little over three months a year. Other than that, it is deserted and lonely, void of services and lacking in basic commodities.
Egypt boasts another coastline, that of the Red Sea to the East, that does not have the problem of having to thrive for only a specific, relatively short season every year. Sharm al-Sheikh, Hurghada, North and South Sinai, and all Red Sea resorts bloom all year round. Why the glaring difference between the North Coast and the Red Sea coast? The answer is obvious: the application of policies that give precedence to the hospitality industry as opposed to those that favour private use of the land.
In absence of nationwide, long term planning according to well-defined objectives in the 1970s and 1980s, the political authority delegated the investment planning of the Red Sea Coast to experts with touristic expertise, and that of the Mediterranean Coast to real estate experts. Touristic mentality focuses on investing in sustainable projects that create lucrative all-year-round business and job opportunities, even though there exists the risk of occasional tourist bust periods. Real estate mentality, on the other hand, believes in safe, carefully calculated investment in terms of cost and profit. It relies on development for direct, private use. It is a mentality that, by its very raison d’être, does not accommodate risks of loss.
In the absence of national planning, it looked as though a man divided his wealth between his two children; one exploited his share in some sustainable investment that generated perpetual income, whereas the other sold his share and secured a large income but lost the capital. This is how I explain the divergent policies between the tourist projects in Egypt’s Eastern Coast—the Red Sea and Sinai—and the private-use nature of the resorts on the North Coast. Legislation concerned with allocating land in the Eastern Coast decreed that hotel share does not go below 75 per cent of any land allocated or sold, meaning that only 25 per cent would go to strictly private use. This policy produced a wealth of hotels that now constitute the backbone of tourist investment in the region, ensuring sustainable operation and job opportunities all year round. Conversely, the real estate investment on the North Coast resulted in a large number of resorts restricted to private use. The result is billions of pounds lost to potential investment other than the expected evaluation in real estate value.
Accordingly, the North Coast became doomed to a boom of no more than four months a year, hibernating for the remaining months of the year, whereas the Eastern Coast is lively and active all year round. This is the predicament—if not catastrophe—of the North Coast. But is there no way out? Will New Alamein hold a lifeline for the region? Is there any vision to develop the ownership system there? This is an important issue that has for long been placed on hold, and which must now be tackled.

Watani International
9 September 2018

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