This partnership is a much-needed bolster to investments in the SCZONE, as it not only strengthens localised industries but will also make advanced manufacturing technologies available, increase domestic production and offer a global push for Egyptian exports.
Egypt’s Ain Sokhna Industrial Zone, part of the Suez Canal Economic Zone (SCZONE), has inked a deal with Kemet Industries Group and Emirati-Chinese firm Al Qalaa Red Flag, and is set to begin three new mega projects worth a combined $3.5 billion.
The projects under this agreement include the construction of a seamless steel pipe factory, which can produce up to 250,000 tonnes annually, to meet Egypt’s requirements for its upcoming infrastructure and urban development projects. This will also help reduce the country’s reliance on imports.
Funds will also be allocated to set up a tyre factory with an annual production capacity of approximately 12-15 million tyres. A fibre optic cable manufacturing facility is also set to be developed to meet the country’s communications and information technology sector’s infrastructural needs. This will contribute to facilitating digital transformation and strengthening high-speed network connectivity across the North African country.
This partnership is a much-needed bolster to investments in the SCZONE, as it not only strengthens localised industries but will also make advanced manufacturing technologies available, increase domestic production and offer a global push for Egyptian exports.
The Egyptian Cabinet took to Facebook to announce that through the cooperation between the two parties in the SCZONE, investments for these three mega projects have totalled #3.5 billion. The Cabinet also said in its statement that this initiative will create employment opportunities for Egypt’s youth and is in tandem with the country’s aim to achieve comprehensive economic, social, and environmental development.
In the last fiscal year, the SCZONE has finalised 129 projects worth $4.4 billion, which has led to the creation of over 31,000 jobs. From July to mid-September, 26 more industrial and logistics contracts in Sokhna and Qantara West were signed, which have been valued at $1.85 billion and are estimated to create 21,800 jobs.
In September, it was reported that the SCZONE has garnered $6.3 billion in new investments across 155 projects in the preceding 14 months. This has resulted in record revenues of 11.6 billion Egyptian pounds ($237 million) for the 2024-25 fiscal year, a 38% jump in year-on-year.
At the second board meeting for this fiscal year, final account approvals showed net profits of 8.6 billion pounds, a 51% increase from last year, while expenditure was 2 billion pounds. According to the SCZONE Chairman Walid Gamal El-Din, these figures have been possible despite a 54% drop in Suez Canal transit revenues owing to reduced shipping traffic in the Red Sea. He attributed this growth to contracts worth $8.6 billion covering 297 industrial, service, and port projects.
The board has also approved five further projects totalling 441,000 square meters and $155 million in investment, which are projected to create 5,100 jobs. There will be four in Qantara West, including projects from Pakistani and Chinese apparel and textile companies, as well as a facility for recycled PVC wall panels and flooring. The fifth will build bonded container yards in Qantara West and Sokhna under the direction of the Egyptian-Turkish joint company SIGMA EGYPT.
The SCZONE has spent $10.4 billion on 334 projects since mid-2022. Of these, 11 projects in seaports total $1.5 billion, while the remaining 323 projects in industrial zones total $8.9 billion in investment and over 100,000 anticipated jobs. Solar panels, tyres, clothing, metals, logistics, and recyclable materials are just a few of the industries covered by the investment portfolio.
The SCZONE aims to attract regional businesses by offering them streamlined access to local markets and talent, value-driven industrial parks that can support and strengthen integrated supply chains. Despite the geopolitical tensions in the MENA region and the threats to the global supply chains due to tariffs and counter-tariff wars, the Suez Canal is expected to attract more such investments to support Egypt’s economy.
