Egypt's Investment Minister Ashraf Salman (R) speaks with Richard Banks, director of Emerging Markets for Euromoney Conferences in Cairo, September 16, 2014 (Photo: Reuters)
Egypt's investment minister, Ashraf Salman, told the Euromoney Egypt conference on Tuesday that the two Suez Canal megaprojects are important drivers for the country's economic growth.
The Suez Canal corridor project will attract $220 billion worth of investments over 15 years, while a new waterway being dug along the canal will bring in $2-5 billion in state revenues over the three years, said Salman.
Businesses will be able to enter bids to invest in development projects along a 160 km corridor of barren desert beside the international waterway, as soon as Gulf-based firm Dar Al-Handasah wraps up its master plan.
In the meantime, work on an extension of the international waterway began in August with the aim of increasing ship traffic to generate higher revenues.
The new waterway will add at least $2-5 billion to Egypt's revenues from the Suez Canal, already a key source of national income and foreign currency, in the next three years, Salman said at the conference.
The digging of the new canal and underground tunnels costs $4 billion, which are being raised by the government through a public offering of investment certificates.
The certificates have proved to be a success, collecting LE60 billion in less than a fortnight, and even LE12 billion on the last day alone, announced central bank governor Hisham Ramez.
"This is a pilot project that is very important in driving growth in the fiscal year 2014/15," said Salman.
The popularity of the certificates shows that Egypt can finance projects internally and that the domestic banking industry has the resources to finance megaprojects, he added.
Egypt's government is targeting a 3.5 percent growth rate by the end of the current fiscal year and 5.7 percent growth by the end of June 2018.