Egypt and Qatar have signed a major partnership agreement on Thursday to develop a luxury real estate and tourism project along Egypt’s Mediterranean coast, marking a key step in Doha’s $7.5 billion investment pledge to Cairo.
At a signing ceremony held in Egypt’s New Administrative Capital, Prime Minister Mostafa Madbouly announced that Qatar will pay $3.5 billion in December for the land designated for the Alam Al-Roum project.
This payment, which will come as fresh foreign direct investment (FDI) rather than deposits, forms part of a total $29.7 billion investment by Qatari Diar, the real estate arm of Doha’s sovereign wealth fund, Reuters reported.
The Alam Al-Roum project will feature golf courses and marinas on a 7-kilometre (4.4-mile) stretch of undeveloped coastline about 480 kilometres northwest of Cairo.
According to Finance Minister Ahmed Kouchouk, the $3.5 billion will help reduce Egypt’s debt burden and strengthen its economic indicators.
In addition to the cash investment, Egypt will receive housing units valued at $1.8 billion and 15% of the project’s profits after Qatari Diar recoups its initial investment, Madbouly said.
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Egypt has long been working to attract foreign investment, particularly from Gulf nations, to address its mounting foreign debt and widening budget deficit.
Two financial sources revealed that the International Monetary Fund (IMF) delayed its disbursements to Egypt under a biannual review because the Qatari investment, which Cairo had assured would materialize by June, had been postponed.
Madbouly described the negotiation process with Qatari Diar as “long and bitter,” highlighting the challenges faced in securing the agreement.
Qatari Diar already holds significant assets in Egypt, including the St. Regis Cairo hotel and apartments, as well as the CityGate and NEWGIZA residential developments on Cairo’s outskirts.
The new Qatari investment is viewed as a strategic counterpart to the United Arab Emirates’ Ras El-Hekma development deal, signed in February last year.
Housing Minister Sherif El-Sherbiny told Reuters during the ceremony that work on Ras El-Hekma is progressing smoothly.
“The development of Ras El-Hekma is going well,” he said. “Developers have received the land, deployed the machinery, and started working on the project,” he added, dismissing reports of any delays.
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Image Credit: Gulf Business
