It has been two weeks since Egypt signed with the United Arab Emirates a deal to develop the North Coast Mediterranean area of Ras al-Hekma, a name which translates into “Cape of Wisdom”, located some 212km west of Alexandria. The agreement was a historic one; the project held huge promise for economic empowerment, and put Egypt on track of its “Egypt 2052” urban development plan. It brought on a resounding uproar with many applauding the project and yet many others criticising it. The details that have now come into focus, however, give a firmly reassuring image that defies the arguments of those critical of the project and, incidentally, of any project that potentially leads Egypt to overcome any of its many challenges and sows the seeds of hope. It is not for nothing that I have penned the title of this article “Ras al-Hekma: The Beginning of Wisdom”.
Ras al-Hekma is not alone in the Egypt 2052 plan. Other spots are set to join it; among them Alamein, al-Negila, Sidi Barani, Gargoub, Matrouh, and Salloum, all on Egypt’s Mediterranean coast, commonly known as the “North Coast”, west of Alexandria. The plan is that these areas should host smart cities built on state-of-the-art infrastructure, capable of accommodating millions of residents and providing millions of jobs. This comes in the context of taking Egypt’s North Coast from its current situation as a place that hosts summer resorts operating only seasonally into a sustainably developed site of year-round, stable, communities. That would guarantee activities, services, and job opportunities for a wide, diverse community which would thrive on development that goes beyond the targeted tourism.
Egyptian governments have worked during the last decade on building infrastructure that has made locations on Egypt’s western North Coast no longer “remote areas” but “promising areas” capable of attracting investment. This includes the highspeed electric train that runs from Sukhna on the Red Sea in the east of Egypt to its westernmost point of Salloum on the North Coast; also the coastal highway from Dumyat (Damietta) on the eastern tip of the Nile Delta to Salloum, as part of the regional North Africa highway. Additionally, there have been huge investments in water, power, and communications projects.
Ras al-Hekma deal represents no dissipation of Egyptian soil. Egypt is not selling off its land to foreigners, as some have depicted the agreement. It is a partnership based on allocating Egyptian land for urban development by an investor, in return for successive instalments and sharing in the investment returns.
Financial details announced concerning Egypt’s share of Ras al-Hekma project read as follows:
The agreement stipulates that the Emirati side commits to pumping a capital of USD150 billion during the execution of the project. The first instalment of that sum is USD35 billion divided into USD24 billion in cash and USD11 billion as deposits with the Central Bank of Egypt. These sums were to be paid to Egypt as USD15 billion in cash a week on signing the agreement—it has already been paid; and USD20 billion to be paid two months on the signing.
The second part of the agreement stipulates that Egypt gets 35 per cent of the profits of the project. To those critical of the deal, this proves the agreement is a partnership.
Ras al-Hekma is not the only project that targets foreign investment in Egypt’s development plans; it is the first of a series of ambitious projects. I cite here a number of such projects mentioned on the websites of Egypt’s Prime Minister and AboutMsr
https://m.facebook.com/Aboutmsr
- Saudi Aqua Power pumps USD10 billion in the project of developing West Sohag.
- Emirati USD3 billion investment in an Aluminium plant.
- Project for building a solar power plant in Naga Hammadi, Qena, to produce electricity equal to half the hydropower produced by the Aswan High Dam. Noteworthy is that Egypt has the world’s 4th largest solar power plant in Benban, Aswan.
- The Emirati Haidar group to build a residential project with integrated services on 157 feddans [1 feddan = 4,200sq.m] overlooking the middle ring road of Greater Cairo.
- Kuwaiti firm to open a wood processing factory at USD120 million investment.
- Hospital to be built with Turkish investment in the New Administrative Capital.
- Johnson & Johnson to build in Egypt its first hospital in Africa.
That was only a sample of a series that shall follow in the wisdom of the Ras al-Hekma project.
Watani International
8 March 2024
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