Three major cities in Canal Zone governorates are experiencing boom conditions as a result of work on the New Suez Canal over the past year. Drawn by the new job opportunities, more people are moving to the cities. Port Said, Ismailia and Suez, the three governorates bordering the Suez Canal, are located at the Mediterranean entrance to the canal, along its length and at its Red Sea exit respectively. The New Suez Canal has already led to increased business in Ismailia, as workers employed in the dredging works for the canal have been mostly housed in the city. Each of the governorates has seen an increase in population, as tens of thousands of people from across Egypt have come to work on the New Canal. “Thousands of people have been coming every week since the dredging of the New Canal started,” said Ahmed Ibrahim, a merchant from Ismailia. He added that everyone wants to see the mega-project with their own eyes, and travellers are stopping by the governorate to shop even if they are heading back to their home cities. The New Suez Canal has caused many businesses to flourish in Ismailia along with other cities and areas near the canal as its official inauguration approaches. More than 20,000 workers have taken part in the dredging works for the New Suez Canal. The influx has boosted business in the governorate of Ismailia in particular, which is the closest to the New Suez Canal. Akram Al-Shafei, head of the Ismailia Chamber of Commerce, said that mainly small commercial activities have flourished since the beginning of the year as a result of the large numbers of workers employed on the New Suez Canal and “visits by people who want to witness history in the making.” Said Al-Shafei, “Many unemployed people have been finding jobs more easily lately, and more people have been encouraged to start their own small- or medium-sized businesses.” Although most of these are small commercial projects and more job opportunities still need to be created, Al-Shafei said that once it is operational the Suez Canal Area Development Project (SCADP) will lead to an unprecedented economic boost for Ismailia and for the wider Egyptian economy. The government has announced that total income from the SCADP is expected to reach $100 billion. Ismailia has been preparing for today's inauguration ceremony of the New Suez Canal since the end of 2014. Its infrastructure has been upgraded, and roads, buildings and facilities have been repaired. “Everything looks good for the New Suez Canal celebrations,” Al-Shafei said. The inauguration of the New Suez Canal coincides with the beginning of another national mega-project that will benefit Ismailia citizens, Al-Shafei added. “We all have high hopes for the Suez Canal Area Development Project, which is expected to give a significant boost not only to Ismailia's economy and trade activities, but also to Egypt's economy as a whole,” he said. Experts predict the project could represent a third of Egypt's economy once it is completed. The SCADP includes 42 projects, six of them considered high priority. They include developing the Cairo-Suez and Ismailia-Port Said roads to improve transport to the capital, building the Ismailia Tunnel that passes through the Suez Corridor to link the east and west banks of the Suez Canal, building a tunnel under the canal at South Port Said to link the east and west banks, developing the Nuweiba Port as a free zone, developing Sharm El-Sheikh Airport to improve travel to the Peninsula, and constructing a new by-pass on the Ismailia canal up to the site of the water desalination station to support new development areas. The SCADP is focused mainly on Ismailia, Port Said and Suez. Two development projects are planned for Ismailia, the first being the “Technology Valley” which will host technology investments. “The Technology Valley will be an industrial area that will include high-technology manufacturing, as well as factories making solar cells from raw materials extracted from Sinai,” said Naema Moheb, director of the Technology Valley project in Ismailia. The project will be built on 215 feddans of land, and its infrastructure, including roads and an electricity and sewage system, is set for completion by the end of 2015. More than LE100 million has been allocated for the valley's infrastructure alone, she said, adding that over 20 companies will join the Technology Valley in its initial phase. Moheb said that a residential complex for site workers and Technology Valley employees will be built at a cost of LE50 million and financed by the Ministry of Housing. A services complex will also be established. Another project planned for Ismailia is the Abou Khalifa Industrial Zone, which is being built on an area of 160 feddans, with investments worth about LE8 billion distributed over 150 projects. Tens of thousands of new jobs will be created through these mega-projects alone, improving employment opportunities for residents of Ismailia and neighbouring governorates. As a result of the expected rise in the number of domestic immigrants to Ismailia, Port Said and Suez who will be working on projects related to the SCADP. A New Ismailia City, including 58,000 housing units, is being built on an area covering almost 5,000 feddans. The housing is expected to accommodate the large workforce of the Suez Canal Area Development Project. The first phase, which includes 14,000 units, is almost finished. According to the Engineering Authority of the Armed Forces, which is supervising the building of the city, apartments and villas to suit people of various incomes are being built. A sports complex has been built, as well as schools, mosques and a medical centre. The minister of housing announced earlier that several projects are being carried out by the ministry, designed specifically to serve the SCADP at a total investment cost of LE3.6 billion. According to Mahmoud Abul-Ela, head of the Suez Investors Association, it is important that local investors participate in the SCADP. “All Egyptian investors, and not just those from the three governorates bordering the canal, must be prepared for the opportunity of a lifetime,” he said. Exceptional opportunities have been created by the government's willingness to provide facilities for those looking to participate in one of the biggest projects in Egypt's history, he added. Fewer visitors to the New Suez Canal site have stopped at Suez, which has seen little effect on trade over the past year. Abul-Ela says that once the SCADP projects get underway the situation will change, especially since more job opportunities in various specialisations will open up and lower area rates of unemployment. Port Said, long known as a free-trade zone, with countless stores and traders, has been affected by a government decision to cancel its free-trade zone status. Since the announcement of the New Suez Canal project last year, however, the city's economy has revived. The government says that LE200 million from Egypt's 2015-2016 budget will be allocated for the development of the Port Said governorate. Last April, the government decided to reduce customs fees for products imported to Port Said by 25 per cent and raise tax exemptions for visitors to LE400 a year. “Trade in Port Said is still weak, but the SCADP gives us hope that trade movements might double,” said Mohamed Al-Masry, head of the Port Said Chamber of Commerce. People are waiting for the announcement of projects to be carried out in the governorate as part of the SCADP, he said. “Our city has been suffering from a recession that has increased unemployment, but the new mega-projects in the Canal Corridor will definitely help solve this problem,” Al-Masry added. In 2012, a violent clash between supporters of two Egyptian teams during a football match in the city left 74 dead and hundreds injured. Port Said has been receiving fewer visitors from Cairo ever since. The new projects should attract more people, providing more customers for local businesses, Al-Masry said. The Ministry of Transportation has also announced a plan to attract investments worth $700 million to expand the Suez Canal Container Terminal at East Port Said, as officials believe Port Said has great potential for growth. Experts believe that the government should be ready with enough land and with the services needed to support the expected mega-projects. “Any lack of the needed land areas supported by basic services will lead to a significant increase in land prices in the canal-bordering governorates,” said Ibrahim Al-Arabi, vice-president of the Egyptian Federation of Chambers of Commerce. The housing projects should also be sufficient to house the large numbers of workers expected to participate in the SCADP projects. “Otherwise, prices and rents will skyrocket,” he added. Ismailia has already witnessed increases in real estate prices over the last few months. “This is normal, as trade movements have increased and more people are visiting the city every day,” Al-Shafei said. He added that projects like the New Ismailia City will help stabilise the real estate market in Ismailia, Port Said and Suez. “We just need to wait for the details of the SCADP projects,” he said.
