Housing Ministry to invest in Sinai Peninsula

25 February 2015

Central Agency for Construction commits additional funds to roads, power and housing projects in Sinai

  • Central Agency for Construction confirms additional funds for Sinai region
  • Housing prioritised by authorities 
  • Contractors looking forward to investment summit in mid-March

Egypt’s Central Agency for Construction, which works under the country’s Housing Ministry, has announced that it is to pump $203m into infrastructure and housing projects in the Sinai Peninsula.

The announcement was made on a local television channel by the agency’s head Mohamed Nasser.

Nasser said the investments’ aim is to upgrade 12,000 kilometres of Sinai’s main roads as well as power, social and housing projects for Sinai’s citizens.

Sinai has historically been neglected by previous governments and the local population has often felt disenfranchised from Cairo. As a result, security has been a major concern with several attacks on army and police checkpoints taking place since the 2011 uprising.

MEED also reported on 24 February that Egypt’s Housing Minister Mostafa Madbouly has announced that he will propose a $19bn residential project during the economic summit being held in Sharm el-Sheikh in mid-March.

Local reports say the project will be called October Oasis and will be built 50km outside Cairo in 6th October City.

Madbouly also stated the government is looking to draft new regulations that “reflect the partnership between the state and investors” to help boost the housing projects market.

Other local reports say the government is likely to increase the housing budget for the 2015/16 fiscal year by $3bn.

It is expected that a number of major housing schemes will be announced and awarded during Egypt’s Economic Development Conference that starts on 13 March.

Contractors in Egypt are looking forward to the next 24 months as the investment summit in mid-March promises new projects and contract awards.

A number of Egypt-based contractors have said confidence in the market is coming from the easing of investment laws, an improving security situation and proactivity from the government. This has meant Egypt’s investment conference promises to be a new start for the country’s project market.

Contractors are expecting a positive forecast following four years of halted projects and minimal investment.

Perfect timing for OCI demerger

Demerger set to be complete in time for Egypt’s economic development conference

The long-awaited demerger of the Netherlands-based OCI NV, which will create an independent Orascom Construction, is expected to have a big impact on the projects sector in Egypt.

The demerger will mean that Orascom Construction will be listed on the Nasdaq Dubaiexchange, but, more significantly, it will also list on the Egyptian exchange. In addition to adding some much-needed liquidity to the Egyptian market, the move is likely to boost work opportunities for Orascom in the country’s impending projects boom.

While the demerger is a clear business decision to enable Orascom to focus its operational strategy and raise extra capital, it is one that will significantly improve the company’s reputation and standing in the Egyptian market. This is potentially lucrative for the firm, with a number of major projects expected to be tendered and awarded in the next 12 months as the new government moves ahead with an ambitious infrastructure programme. Read more

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