The Suez Canal Corridor Area Project – Project of the Century
The Suez Canal Corridor Area Project, also known as “The Great Egyptian Dream” is a project launched in 2014 by President Abdel Fattah El Sisi. The project aims to expand and strengthen the Suez Canal region, and use it as a source of income and an attraction for investment.
The Suez Canal has always been a matter of national pride however, in more recent years, it has been truly utilized by the Egyptian government for the benefit of Egypt’s economy and people. Incorporating the Suez Canal into a development project has always been a matter of political debate, as its unique attributes that make it the perfect area to develop. Firstly, Egypt is in current need of new national projects to support the country’s economy. Secondly, the state must utilize its current ports and zones and develop them further to benefit from them as much as possible. Thirdly, the project will create employment opportunities for Egyptian youth in different industries and positions. Similarly, the mega-project will also mainly rely on Egyptian companies and contractors, encouraging them and utilizing their power. Most importantly, the decisions marks a new stage in Egypt’s history, one where it takes charge of the canal, as it did decades ago, and uses it to benefit the country as a whole.
Realizing the sheer magnitude of the benefits of the canal, the current government has created a three-stage plan:
- The first stage encompasses the development of the ports in Port Said and Suez to keep them up to international standards, including developing a number of industrial projects in these areas.
- The second is the creation of an industrial zone prepared to host a number of different industries, such as those of machinery and textiles.
- The third stage concerns the creation of the “Ismailia Technology Valley”, aimed at creating a zone for the technology industry and any training or research that comes with it.
The project aims to increase national income by 50%, decrease the crossing time at the ports from 18 hours to 11 hours, reduce the wait time from 8 hours to 3, and raise the rank of the canal to make it one of the most efficient in the world.
These stages will be met with a number of miniature logistical projects, such as the creation of seven new tunnels to connect the Sinai Peninsula with Egyptian homeland. These include three in Port Said and four in Ismailia. Another project is Al Nasr floating bridge connecting Port Said and Port Fouad, which was built in 2016. Finally, one interesting project is the National Project for Fish Farming, which is designed to produce high quality fish for food. The project is powered by solar panels, which is a step forward in creating an environmentally-friendly industrial zone.
The mega-project is also supported by the New Investment Law of 2017 (https://www.lexology.com/library/detail.aspx?g=66240360-91e2-46ff-81b9-5ac777345d26Law No 72 of 2017 Promulgating the Investment Law). The law re-introduced free zones in Egypt, after their ban in 2015. One of the 9 free zones is the Suez Public Free Zone. Factories and companies in the free zones receive a number of benefits, such as:
- 1. Having no limitations on transferring profits or investing money.
- 2. The right to import and export without the need to maintain a record on the Importers Register.
- 3. The exclusion of customs duties, VAT, and other taxes and duties on all equipment, machinery, and transportation vehicles necessary to carry out activities in the free zone (except for cars).
- 4. The assurance that property or funds cannot be detained, seized, retained in protective custody, frozen, or confiscated.
- 5. Immunity from any interference by administrative bodies regarding the pricing of any products.
The above attributes have indeed already led to number of positive results; Fitch Ratings have predicted Egypt’s economic growth to increase by 4-5%. More expectations include the canal’s ability to handle 97 ships by 2023 instead of the current 49, an increase in income in foreign currencies, making them more available in the country, and the creation of 5 new residence zones.
In conclusion, the project is reminiscent of past expansion of the canal and the positive results yielded from such growth. This growth is guaranteed once again, as the canal is set to serve millions around the world, as will as millions of Egyptians. Egypt is taking matters into its own hands and is attaining global headlines and rankings. The mega-project is a promising, positive turn set to change Egypt’s current state for the better. It makes Egypt, and the Suez Canal in particular, the perfect environment for foreign investors.
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