Egypt’s House approves EGP 800 million loan for ‘Super Jet’ to operate in NAC

Gamal Essam El-Din , Monday 24 Jan 2022

Egypt’s Parliament – the House of Representatives – approved on Sunday a draft law aiming to allow the Arab Union Company for Land Transport ‘Super Jet’ to obtain an EGP 800 million loan from a number of Egyptian banks under guarantees provided by Minister of Finance Mohamed Maait.

File photo: Egyptian parliament (Photo: Reuters)

A report by the House’s Budget Committee said that the loan is necessary to help Super Jet operations inside Egypt’s New Administrative Capital (NAC).

“The loan will give Super Jet the money necessary to buy 120 minibuses and build a garage inside the NAC to serve the first phase of internal transport there,” said the report, adding that “the law will also make it legal for the Finance Minister to guarantee Super Jet as the constitution stipulates that the government can take loans or offer loan guarantees only with prior approval from parliament.”

The report indicated that in return for guaranteeing the loan, Super Jet will offer the Ministry of Finance an in-kind collateral in the form of assets such as lands, buildings, cars, and microbuses, the price of which is equal to the loan.

The committee’s report explained that Super Jet’s decision to take a bank loan comes under the instructions of the political leadership, which is doing its best to implement the first phase of internal transportation inside the NAC.

“Internal transportation is very important to facilitate the transfer of businesses and government ministries and institutions to the NAC, particularly during the first phase of operations there,” said the report.

MP Mohamed Hammadi said the transfer of government departments and ministries to the NAC is very important and in order to achieve this objective, it is necessary to support internal transportation there.

“Super Jet is 50 years old and has a lot of experience in land transportation operations, not to mention that it has a lot of assets that can help it repay the EGP 800 loan,” said Hammadi.

MP Abdel-Fattah El-Shahat said it will be very difficult to encourage government and private institutions move to the NAC without first introducing an integrated system of land transportation there.

“The loan will help Super Jet implement this system and make it very easy for citizens to go to the NAC,” said El-Shahat.

MP Mahmoud Essam said he has reservations over the bank loan, revealing that Super Jet suffered EGP 11 million in financial losses in 2021.

“I am afraid the loan could complicate the company’s financial problems,” said Essam.

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