Egypt considers PPP for future metro projects

05 October 2015

France provided $1.5bn of financing for Cairo’s metro network between 1979 and 2012

Egypt is considering utilising a public-private partnership (PPP) model for the future expansion of the Cairo metro, according to Sameh Refaat, vice chairman of the National Authority for Tunnels (NAT).

Speaking on the sidelines of MEED’s MENA Rail and Transport conference in Dubai on 5 October, Refaat told MEED: “initially we were not considering the private sector with metro work financed through public funds and international loans. But now we are open to the involvement of the private sector, with a PPP model now becoming an option for further work”.

In the past, the Cairo metro has received significant financial support from France. According to Naglaa el-Ahwany, former international cooperation minister, France financed $1.5bn of Cairo’s metro network between 1979 and 2012.

An agreement was signed with France’s ambassador to Egypt on 14 December 2014 that will involve Paris providing Cairo with $214.4m as a concessional loan, which is to be repaid over 53 years. The loan will have a 20-year grace period at an annual interest rate of 0.1 per cent. The second half of the finance will come in the form of credit facilities by French credit company Coface.

Meanwhile, Egypt’s PPP Central Unit is pushing ahead with a number of major projects, such as the recently awarded PPP scheme to expand the Abu Rawash wastewater treatment plant. As the PPP unit’s network of private investors expands, there is an expectation that more transport schemes will be developed using the PPP model.

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