Egypt’s Housing Ministry has told MEED the capital city project has not been cancelled and negotiations are ongoing.

A spokesperson from the ministry has falsified local reports made last week and told MEED: “This is a complex process and will take some time before the final agreements are met and the project can start.”

Despite this, sources close to the scheme have also told MEED that the UAE’s Capital City Partners and the government are currently disputing the financing of the first phase of the project.

The Egyptians are understood to be keen on funding for the first phase to come from foreign banks rather than local cash-strapped institutions.

Negotiations between the authorities and Mohamed Alabbar’s Capital City Partnership are ongoing, with the spokesperson from the ministry telling MEED: “No announcement will be made until after Ramadan.”

The capital city project was announced at the Egypt Economic Development Conference (EEDC) held in Sharm el-Sheikh in March this year, and was positioned as the event’s flagship scheme.