East Port Said receives presidential approval, work to start this month: Zaki

Investments required in mega project exceed $50bn-$60bn, says Dar Al-Handasah Director of Operations

Daily News Egypt sat down with Yehia Zaki, the Director of Operations at Dar Al-Handasah, to discuss the progress of the detailed plans on the Suez Canal Zone's ports and industrial zone. During the interview, the timeframe for implementing those plans, the anticipated volume of investment, offered job opportunities and the industries each port will focus on were tackled.
Can you give us some details on the ports' master plan, in particular that of Port Said, taking into consideration previous announcements that it has great potential?
As you know, the project includes six ports. The most important two are Port Said and Ain Sokhna ports. [The development of] each one of those two ports is connected to the characteristics of its logistics and industrial areas. We can't work in one port individually, as we need to be looking on the whole image. After finalising the master plan, in which we placed a vision for each port's function and activities that will be carried out in it, we started focusing on each one through providing some details.
On 1 August, we met with President Abdel Fattah Al-Sisi to present the progress made in the East Port Said Area, including the port and its associated logistics and industrial areas. We reviewed the plan for the development of the port. The port currently exists and has some activities. We are implementing a new extension over different timeframes with the aim of allowing it to absorb new marine platforms, mainly for containers trade. It will be focused on the trade of containers as it is a promising port for trans-shipment. The containers trade and trans-shipment are the focus of the east Port Said port. We received the approval to start work immediately after the opening of the New Suez Canal. The work will be conducted over a timeframe of 15 years. We will start, and each year and half, a part of the master plan will be accomplished and put into operation.
Within 15 years, we would like to have an international industrial logistics centre in the area of East Port Said. This doesn't mean that we will wait for 15 years to accomplish results. Each year we will see results. This is why in order for this port to work and succeed; an industrial and logistics area should be present to support it. Everything must be developed together, including the infrastructure. The start will be right after the launch of the new Suez Canal and the development of the port and the industrial zone will start.
It will be developed with the Industrial Developer technique, wherein an industrial development company takes an area, around 4m sqm, and promotes it to attract investors and factories. This is a very ambitious plan, and it has become clear to us.
What is the predicted cost for development in the first 18 months?
It is not easy to predict, because there is the port, and then you have the infrastructure and the development of the industrial zone. We are currently conducting a detailed study for the port. We have the general plan and then the detailed plan, through which we will have details on the projects. For example, the development of the port will occur over several years and it can have a budget of EGP 15bn.
What about the targeted industries for the port?
As I said, the general plan is already approved and the master plan is available and now we are doing the detailed studies for the zone. The east Port Said project is the starting point for the whole mega project. There are four main industries: engineering industries, automotive industries and automotive components, electronic and home appliances, as well as packaging industries. These will be the industries on which the east Port Said zone will be based. [For the first stage]the industrial zone's space is about 40 sqkm and will be developed over various stages and will offer about 400,000 job opportunities within the implementation period [15 years]. The whole Suez Canal project will offer 1m direct job opportunities.
What about the other ports?
The Ain Sokhna Port will also be developed over several years. The industrial zone will rely on medium and heavy industries, such as petrochemicals. It will have a large residential area. Work on this port will also start immediately. The start of the project will be in Port Said, but will be immediately followed by Ain Sokhna. We will present the project details to Egyptian authorities to get the approval to start.
What is the space allocated for the Ain Sokhna industrial zone?
It's a large space, around 250 sqkm for the whole zone, in comparison to 150 sqkm for the whole Port Said zone. There are other zones in El-Qantarah and Ismailia. They do not have a port, but there's a suggestion that a dry port can be established. This dry port will rely on land transportation and will depend on its closeness to the agricultural lands. The targeted industries will be the agribusiness and textile industries. The industrial zones are all connected to one another, as well as the infrastructure work that will be implemented. We have two other ports in Sinai, the Al-Arish Port and Al-oor Port, although they are not related to the economic zones that we are working on. At the beginning of the study, there was a vision to add these ports to the Suez Canal zone. Al-Arish Port will be developed so that the area between it and Port Said in the north will be a touristic spot, following the stabilisation of security. The area has great potential and according to that plan, the port is being developed in order to serve the industries that are outputted from Sinai. The same concept is applied in the south for Al-Tor Port. Why are both ports included in the study? Because, as I said, we are looking and developing a comprehensive outlook.
What is the anticipated investment by the end of the 15 years?
The required investments in ports, utilities and infrastructure in total and at different stages are about $50bn to $60bn at least. This is separate from the investments in the industrial zones themselves.
Do you have a vision for the number of project in every zone?
This is very difficult to predict. If you take east Port Said, you'll see that the industrial zone is a project and the port development itself is another, while the infrastructure work is a third. Then you'll have the port itself which might have four or five projects. This makes the number of contracts or projects hard to predict. The first partial development for Phase I, which will be conducted in the first 18 months, needs huge engineering works, so maybe five or six companies will conduct it.
Have any specific companies expressed interest?
Major companies from Saudi Arabia, the UAE, Europe (namely Italy and France), and many from China showed interest in the project. They are interested in all industries.
Several months ago, in one of your presentations, you stated that there were two scenarios being planned for the vision after 2030. Which one was picked?
We were discussing the development of the zone's strategy after 2030, and with those we had two alternatives; whether to move east and develop the depth of Sinai or to integrate the project with Cairo and move to the west. What we have reached is two things; to define what we need in detail first for the strategy until 2030, then merge the two alternatives, placing a third strategy after 2030 that makes both scenarios applicable.
Can we discuss details of the infrastructure? You previously told Daily News Egypt that infrastructure is expected to be $15bn, with 3.8m cubic metres of water supply and 6 GW of electricity?
Yes, this is what was expected when placing the master plan. We also need to take into consideration that the detailed design level will be more accurate in predicting the required infrastructure.
When Dar Al-Handasah first signed the contact, it was worth $1.8m. Will we see an increase in that figure?
We would like to be committed for a longer stage. As a consulting company and a group, we would like to remain committed to this project, not only for the master plan but for any further steps. As for the contractual details of the master plan they remained the same.