Chinese firms have returned to Cairo to restart negotiations that could see up to $20bn-worth of investments pumped into the proposed New Capital City project.

While the Egyptians will say this is a positive development, it serves as yet another confusing chapter in the story that is Egypt’s New Capital City.

The story started in 2015 when the president announced the project at the Egypt Economic Development Conference in the coastal city of Sharm el-Sheikh. At the time it was announced as a $40bn Eagle Hills project with UAE real estate investor Mohamed Alabbar.

Not long after, the project’s flagship status was reduced when Alabbar pulled out of the scheme over various disagreements including the UAE company’s ability to raise funds from local banks.

The Egyptian government then went at it alone before announcing several agreements with Chinese firms including China Fortune Land Development (CFLD) and China State Construction Engineering (CSCEC). The memorandum of understanding (MoU) was set to see up to $20bn-worth of investments from the Chinese.

This agreement broke down earlier this year, leaving the Egyptians to again look towards local companies to plug this gap.

In the first six months of this year, local contractors such as Arab Contractors and Hassan Allam Construction picked up various work in the proposed ministerial district, while local developers such as Talaat Mostafa were awarded swathes of land in a government auction.

But after some success in pressing ahead with the first phase, the latest from the housing ministry is that talks with CSCEC and CFLD have restarted.

The talks will be a relief for the authorities, which have been concerned over the strain on public finances a project like this could have.

But the confusion will be for local firms that had previously been told to focus their efforts on projects in the New Capital City area. If the authorities are able to finalise a deal with Beijing, it could leave local firms sidelined as Chinese companies get preferential treatment. To counter these concerns, the authorities will need to be transparent.