PM Witnesses Signing of Partnership with UAE to Develop Ras Al-Hikma

Prime Minister Mostafa Madbouly witnessed the signing ceremony of the largest direct investment deal in the history of Egypt, Friday, with the Emirati side to develop the Ras El Hekma region on the northwest coast.

The signing came under the title of Egypt and the Emirates “Partnership for Development - Ras Al-Hikma”.

The agreement was signed on the Egyptian side by Assem El Gazzar, Minister of Housing, Utilities and Urban Communities, and on the Emirati side by Mohammed Al Suwaidi, Minister of Investment of the United Arab Emirates.

The prime minister confirmed that the Ras El Hekma City development project on the northwestern coast of Egypt is considered, by all standards, the largest foreign direct investment deal in the history of Egypt.

 Madbouly said, "The idea of the project and the integrated urban development plan for Egypt 2052 was that the northern coastal region of Egypt was the first promising region that could accommodate the largest amount of population increase in Egypt, because of its very promising potential of lands along the coast and the suitability of its climatic conditions to accommodate the largest amount of population. This plan was developed by a group of cities and worked to change the idea of developing the northern coast to develop integrated urban communities and not summer tourist resorts.”

The Prime Minister continued that the plan identified the cities of (Alamein, Ras El Hikma, El Negila, Sidi Barrani, Jarjoub) as new cities that can be developed in addition to the development of Matrouh and Salloum so that we have a series of new smart cities with developed infrastructure that will accommodate millions of residents and create millions of job opportunities for youth.

Madbouly explained that this project is like other projects undertaken by the state; it allocates land to the developer and the state takes a cash advance in exchange for the land, and also has a share of the project’s profits in order to maximize the state’s assets.

He pointed out that the project is considered the largest of its kind because it aims to develop a city with an area of 170 million square meters, or more than 40,600 feddans, explaining that the Abu Dhabi Developmental Holding Company will establish a holding company or a company in the name of “Ras Al Hekma”, which will be responsible for the project.

The Prime Minister pointed out that the project will include residential neighborhoods for all levels, international hotels at the highest level, tourist resorts and giant entertainment projects, in addition to all the urban services present in every city, whether schools, universities, hospitals, administrative and service buildings, in addition to a special service free zone.

Madbouly explained that the city will also have a large international “marina” for yachts and cruise ships, noting that outside the project land, it was agreed to establish an international airport south of the city, by allocating land to the Egyptian Ministry of Aviation.

The payement will include foreign direct investment entering the Egyptian state within two months, with a total of $35 billion. They will be divided into two batches, the first within a week, with a total of $15 billion, and the second batch two months after the first, with a total of $20 billion.

He explained that for the first batch of $15 billion, it will be divided into $10 billion, liquidity coming directly from abroad, in addition to Abu Dhabi Holding Company’s waiver of the portion of deposits in the Central Bank of Egypt (CBE) amounting to $11 billion. Up to $5 billion will be used in the first batch, which will be transferred from dollars to Egyptian pounds in order for the company to use them in establishing the project.

He pointed out that after two months, the $20 billion will enter the country, of which $14 billion comes in the form of liquidity, in addition to the remaining part of the deposits, which is $6 billion, which means $24 billion direct liquidity in addition to the $11 billion that are in CBE deposits and will be transferred at the Central Bank in Egyptian pounds, that the company will use in the project.

Madbouly added that this money is deposits and obligations of the Egyptian state that it cannot dispose of, and it was registered within Egypt’s external debt, and therefore this amount will fall from the external debt.