The performance of Egypt's ports is nearly equivalent to that of foreign ports, according to maritime transport experts, and though the political instability has affected companies operating in the maritime market, this has not led any of these to exit the market altogether. Moreover, the maritime transportation and logistics sectors are among the most promising and attractive markets in Egypt for investment, with both being ready to receive further investments. However, last week the US agribusiness giant Cargill expressed “a pressing need for more investment to relieve port congestion in the Middle East and North Africa to ease delays that make governments pay more for imported food”. “The Middle East and North Africa today have very long line-ups of vessels as the port capacity to get the commodities into the supply chain is not sufficient,” the managing director of Cargill in the Middle East and Africa said in a Reuters report. Delays in handling and discharging shipments at Egyptian ports could eventually increase freight costs, pushing the price of imports higher and holding up the supply chain. Mohamed A. Hashish, vice-president of the Egyptian International Shipping Group, said that delays in shipments increased the prices of imports. “If a vessel has to linger in port for 10 days waiting for a shipment to be discharged, of course the shipping costs will swell. The port will charge the ship for mooring, and this will be charged on the final bill,” he explained. However, he denied that delays were being caused by port authorities in Egypt. There was no overcrowding or long line-ups at Egyptian ports, he said. “But in cases of vessels carrying food commodities, especially wheat, the government has stated that shipments should go through certain steps to make sure they are suitable for human consumption,” Hashish said, explaining that this could lead to delays. The regulatory authorities and the agricultural quarantine authorities do not allow the release of any shipment unless it passes through screening tests to Egyptian standards to confirm its validity for human consumption. Samples are taken by the regulatory authorities and sent to the relevant labs, and the shipment is only released after results are received. “In the case of wheat, they have to make sure it doesn't contain toxic seeds and that it is free of radiation, parasites or other hazardous materials,” he said. Last month, the General Authority for Supply Commodities (GASC) bought 240,000 tonnes of wheat from Russia and the United States at a price of LE2,096 per tonne ($301) through global tenders. The current wheat stockpile will last until mid-May 2014, and though Egypt's existing silo storage capacity is 1.5 million tonnes, the UAE has promised to build 25 new silos as part of its $4.9 billion aid package to Egypt, each with a capacity of 60,000 tonnes. This will bring the country's storage capacity to three million tonnes by mid-2014. The Cargill official noted that port development “should take priority over the onshore storage projects that have attracted considerable investment,” however, and it is true that Egypt's ports need a revamp. During a press conference held at its headquarters last month to announce plans to develop the country's sea ports and maritime transport sector, the ministry of transport said that it was aiming to attract LE87 billion in investment in two phases through to 2050. Although some ports such as Alexandria and Damietta were renovated and developed in the 1980s and beyond, others have not seen any revamp in decades, among them west Port Said. “The West Port Said port definitely needs development,” said Adel Lamei, chairman of the Port Said Chamber of Shipping. “The port needs urgent renovation. The roads, the docks, and the storage areas are all old and crumbling.” He added that the terminal operated by the Port Said Cargo and Containers Handling Company was being developed. “The dredge work will be finished within a year, but that is only 900 metres of the whole port.” The development of the infrastructure of the West Port Said port was the ministry of transport's responsibility, Lamei added. Despite high demand for investment in infrastructure, the government's capacity to fund projects is limited and Egypt continues to be highly dependent upon loans and financial assistance from neighbouring countries. However, the ministry plans to attract LE50 billion in investment for the sector in the first phase until 2030, raising the ports' capacity to 370 million tonnes per year through their handling of 24 million containers, up from the current capacity of 120 million tonnes handling six million containers. In the second phase of the plan, from 2030 to 2050, the ministry of transport aims to attract LE37 billion to increase port capacity to 600 million tonnes annually handling 40 million containers.
