CAIRO - 19 March 2023: Abu Dhabi Ports Group announced Saturday the signing of a concession agreement to develop and operate the Egyptian port of Safaga, in addition to two agreements for a period of 15 years to establish two cement handling terminals, a memorandum of understanding and three preliminary agreements that include Egyptian ports overlooking the Red and Mediterranean seas.
This contributes to greatly expanding the group's activities in Egypt.
These agreements aim to provide multi-purpose ports and cruise ship terminals, and to enhance logistical capabilities in the cities of Safaga, Ain Sukhna, Port Said, Hurghada, Sharm El-Sheikh and Arish, according to the Emirates News Agency, WAM.
The Abu Dhabi Ports Group and the General Authority for Red Sea Ports signed a 30-year concession agreement, granting the group the right to develop and operate a multi-purpose terminal in the Egyptian port of Safaga, which enjoys a strategic location overlooking the Red Sea coast.
Thus, the port of Safaga will be the first international port in the Upper Egypt region, as it will achieve significant cost savings for workers in the trade and industry sector and companies operating in this region.
Under the agreement, the marine terminal will be developed on an approximate area of 810,000 square meters, and is scheduled to be operational in the second quarter of 2025.
The terminal will have a quay wall with a length of 1,000 meters, and will be able to handle five million tons of general and dry cargo, one million tons of liquid cargo, 450,000 TEUs and 50,000 vehicles.
As part of the concession agreement, the Abu Dhabi Ports Group will allocate a total investment of up to $200 million to develop the superstructure, equipping equipment, buildings and other real estate facilities, and the public services network within the concession area, with the majority of these capital expenditures to be spent between 2024 and 2025.
It is expected that the group will not face any risks related to currency fluctuations, as all revenues will be converted into dollars.
The two agreements were signed for a period of 15 years between the Abu Dhabi Ports Group and the General Authority for the Economic Zone of the Suez Canal, according to which the group will establish two terminals in the port of Arish and the port of West Port Said to handle bulk cement, with an investment in the two terminals amounting to LE 1 billion.
The group will also establish silos with a storage capacity of 60 thousand tons in the port of Arish, and 30 thousand tons in the port of East Port Said, and each station will be able to handle between one million and one and a half million tons annually. This contributes to doubling Egypt's cement exports to global markets. The two stations are expected to start operating in the fourth quarter of 2023.
The implementation of the two agreements is subject to the approval of the Board of Directors and the General Authority for the Suez Canal Economic Zone.
The MoU, signed by the Abu Dhabi Ports Group and the General Authority for the Suez Canal Economic Zone, aims to enhance ways of joint cooperation in various transport and infrastructure projects in Egypt, with an initial focus on developing a multi-purpose terminal and a logistic and economic zone in East Port Said.
Upon these agreements, the group will develop three terminals, including a ro-ro terminal, a cruise terminal, and another multi-purpose terminal, and it will manage and operate a cruise ship terminal in the port of Hurghada.
Moreover, the group will undertake the development, management and operation of a cruise ship terminal in the port of Sharm El-Sheikh.
The UAE is the second largest trading partner of Egypt in the region, and the first country in terms of foreign direct investments, as it contributes 29 percent of foreign investments in Egypt. On the other hand, Egypt is the UAE's fifth trading partner in terms of non-oil trade, contributing 7 percent of the UAE's total non-oil trade with Arab countries.