Amid the present global tensions, China is convening the Shanghai Cooperation Organisation Plus Summit in Tianjin this week, the largest annual gathering ever held by the group that comprises 20 countries, including China, Russia, and India, and spans founding members, observers, and dialogue participants.
Egypt was invited to attend the summit, represented by Prime Minister Mustafa Madbouli on behalf of President Abdel-Fattah Al-Sisi. It is taking place amid heightened political tensions in the Middle East, deepening economic crises, and a continued slowdown in Red Sea shipping.
However, the recent geopolitical tensions have not prevented the flow of billions of dollars in Chinese investments into Egypt. Over the past few weeks, agreements have been signed to establish a car tyre plant and a flooring factory, and the China Energy Engineering Corporation has announced plans to invest $1 billion in Egypt over the next five years in desalination, renewable energy, and energy storage facilities.
A consortium of Egyptian, Chinese, Bahraini, and Emirati investors is also setting up a $220 million industrial complex for solar energy components in the China-Egypt TEDA Industrial Zone.
The trade policies of US President Donald Trump are among the key factors behind the recent surge in Chinese interest in the Egyptian market. “The time is favourable for investors seeking to maintain their share in the US market by establishing factories in Egypt,” said Sherif Al-Sayyad, chairman of the Engineering Industries Export Council.
He explained that Egyptian exports benefit from reduced US tariffs of 10 per cent, compared with customs duties exceeding 30 per cent on goods from some other countries.
Al-Sayyad added that the current climate is favourable not only for Chinese investments but also for Turkish, Indian, and Korean investors in Egypt. This has been evident over the past four years, during which foreign direct investment (FDI) from these countries, led by China, has grown significantly in Egypt.
This perception is reflected in the media coverage of the Shanghai Summit, with headlines such as “Is Egypt China’s New Gateway to the American and European Markets?” The Arabic-speaking Chinese media has portrayed Egypt-China relations as a successful strategic partnership grounded in mutual respect and benefits, presenting China as a reliable and stable partner for Egypt, the Arab world, and Africa.
Most reports have concluded on an optimistic note, describing China-Egypt ties as “model relations between major developing countries”.
Egypt’s invitation to the summit stems from its Middle East policies, which have demonstrated resilience, determination, and adherence to principle, said Mohamed Ali Ibrahim, a professor of transport and logistics and founding dean of the Faculty of International Transport in Cairo.
These policies, he argued, reaffirm Egypt’s strategic weight in the Middle East and Africa.
The China summit also cannot be viewed in isolation from the global trade war, the struggle to control international maritime trade routes, and the search for alternatives to traditional networks, he said. These developments coincide with political pressures aimed at fragmenting the region and undermining it as a unified political and economic bloc.
Against this backdrop, opportunities are emerging for Egypt and China to pursue common objectives aligned with their development strategies. Just as China has recently established industries in the US’s backyard, it can also turn to Egypt as a gateway to Africa by investing in the Suez Canal Economic Zone.
Ibrahim noted that avenues for China-Egypt cooperation extend beyond industrial localisation in the Zone to include applied research and education.
However, he cautioned that an internal challenge must first be addressed: improving the investment climate and formulating a comprehensive vision for industrial development that aligns with Egypt’s political and demographic priorities.
He added that the narrow approach of seeking immediate returns through the sale of industrial land should be abandoned, as greater and more sustainable benefits lie in industrial localisation, including taxes, exports, and employment.
He also stressed the need to engage more fully with multinational companies specialising in industrial development, as well as major global industrial developers, noting that some of these entities wield influence extending beyond their home countries.
Chinese direct investment in Egypt rose from $6.8 billion in 2020 to more than $9 billion by the end of 2024. These investments are focused on strategic sectors that support Egypt’s 2030 development plan, including infrastructure and urban development.
In the New Administrative Capital, Chinese companies have invested more than $3.8 billion, including the construction of the tallest tower in Africa.
In the field of new and renewable energy in the Gulf of Suez, Chinese investment has reached $1.3 billion, covering a factory for electric vehicle production and the Light Rail Train. Meanwhile, the Chinese Industrial Zone in the Suez Canal hosts more than 130 companies, with investments exceeding $1.5 billion and generating over 30,000 direct jobs.
Imad Al-Saei, a transportation and logistics expert, said that the prevailing global political and trade uncertainty, intensified by the decisions of the current US administration, requires China to strike a balance in its transport and logistics strategies, particularly in view of growing Arab economic synergies.
He noted that Egypt remains the largest recipient of foreign direct investment in Africa, despite complex geopolitical challenges.
According to the China Chamber of International Commerce, Egyptian investment in China has also expanded, rising from $120 million in 2020 to more than $180 million in 2024, in sectors such as textiles, agricultural products, and logistics services.
Despite the disruptions caused by the Covid-19 pandemic and the resulting repeated closures of ports and airports, bilateral trade has continued to grow, increasing from $12.5 billion in 2020 to $17.37 billion in 2024, according to official Egyptian and Chinese figures.
* A version of this article appears in print in the 4 September, 2025 edition of Al-Ahram Weekly
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