Egypt yet to reach agreement with train supplier

16 August 2016

Negotiations ongoing between rail agency and firms

Egyptian National Railways (ENR) is still holding negotiations with two separate groups for the supply of 100 locomotives and 700 non-air-conditioned coaches for its main rail system.

“Negotiations are still ongoing and there is no definite timeline in terms of awarding the contract,” a source familiar with the transaction tells MEED.

It is understood that ENR has been discussing funding options and terms with international suppliers such as the US’ GE, Germany’s Siemens and Canada’s Bombardier, among others, for the supply of 100 locomotives.

The rail agency is also engaged in separate negotiations with Hungarian, Russian and Romanian firms for the supply of 700 non air-conditioned train coaches.

In June, MEED reported that Hungary’s Ganz Motor and Dunakeszi are the frontrunners for the contract, with the final price being negotiated.

It is understood that Hungarian Export-Import Bank has signed a letter of intent to extend a €900m ($1bn) loan to Egypt to finance the purchase of the coaches.

Russia’s Transmasholding was understood to also be competing for the contract, after it signed a memorandum of understanding (MoU) with ENR to supply and finance the 700 coaches.

Egypt has one of the oldest and longest rail networks in the region. ENR, a division of the transport ministry, operates the country’s 9,750-kilometre mainline network, which comprises 705 stations and 885 bridges and tunnels.

The purchase of the new locomotives and train coaches is part of its initiative to modernise the rail network.

European Bank for Reconstruction & Development (EBRD) also recently invited firms to bid for the contract to design, install and maintain six train sets on behalf of ENR. The acqusition of the six train sets will be funded under a €126m ($141.7m) loan suppplied by EBRD.

A MEED Subscription...

Subscribe or upgrade your current package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications