Egypt’s government cannot rely on revenues from oil and gas sales to pay its way. While its hydrocarbons deposits are sizeable, the revenues they produce are insufficient to finance the infrastructure required by its population of 83 million.

Cairo thinks it has found a way to pay for its infrastructure plans. It has created a list of the country’s priority projects. Roads, railways, ports and desalination plants all feature in an infrastructure projects programme worth up to £E130bn ($24bn).

The Investment Ministry hopes to award all the projects by the end of June 2011, with the bulk of the work being completed by the end of June 2012.

There is a snag, however. The 47 projects in the infrastructure programme are all long-term concessions that will pay fixed rates of return to their financial backers. The most adventurous investors, such as private equity firms, do not spend money on projects that generate relatively modest annual rates of return; they prefer to double, triple or quadruple their money when they exit investments.

Most of the major investors in utilities are European companies that are used to operating in countries with wealthy populations and relatively developed legal systems. But Egypt, with its gross domestic product of just $2,162 a person, offers relatively meagre financial returns to investors.

There is also the risk, which Egyptian politicians are loath to discuss, that the country will suffer a political upheaval when its octogenarian president, Hosni Mubarak, inevitably steps down in the coming years.

Projects in sectors in which Egypt has a competitive advantage, such as the 13 port schemes, should be able to attract investors. But for socially useful infrastructure investment spending, such as on wastewater treatment plants, the Egyptian government would be better off asking the African Development Bank or

Priority: Egypt needs to upgrade infrastructure