There should be an institutional framework for the logistics industry in Egypt to maximise economic returns from the Suez Canal. To that end, the Egyptian authorities have revealed plans to list a number of key port companies in Alexandria, Damietta, East and West Port Said, Adabiya, Sokhna and Safaga on the country’s stock market.
However, Minister of Transport Kamel el-Wazir has stressed that the state would not sell these ports, noting that the abovementioned ports will be managed for a certain period of time in co-operation with the private sector.
Earlier on May 15, Prime Minister Moustafa Madbouli unveiled in a press conference in Cairo plans to merge Egypt’s seven largest seaports into one company to be listed on the stock exchange.
These plans are aimed at boosting the nation’s industrial and commercial potential thanks to its unique geographical location. The turning of the Suez Canal into a global logistics hub will be a milestone breakthrough for the Egyptian economy. The Suez Canal zone can significantly boost container traffic between South-east Asia, Africa and Western Europe.
Egypt has 44 seaports, of which 15 are commercial. There are seven mineral, five fisheries, four travel and 11 petroleum seaports. Commercial seaports, which deal in general goods and container handling, have 32.4 km-long piers, according to Transport Ministry data.
Suez Canal
Egypt should bank on the maritime transport industry in its overall economic development, emulating success stories in Dubai, Singapore and Hong Kong.
The nation’s maritime industry is seen to boom thanks to expansions in the Suez Canal. The North African country has already taken steps in this regard. In 2015, Egypt opened a new 72-km channel as part of the Suez Canal to increase the capacity of the waterway.
The new channel and the deepening of the old waterway will attract leading companies to invest here. Traffic will be slashed from 11 hours per vessel to three hours, increasing the waterway’s capacity in the long term.
Moreover, it is a must to upgrade the sector by turning the nation’s 44 seaports into smart facilities, emulating a worldwide trend.
Overall development
The overhaul of seaports should be a continuous and integrated process. In a bid to increase the handling capacity of the nation’s seaports and ease pressure on the domestic road network, the government is working on a dry port in the October 6th City industrial zone at a cost of $160 million.
A dry, or inland, port is connected to a seaport via a direct road or railway to facilitate imports and exports of goods. Inland ports are usually constructed to slash transport costs and time needed for cargo handling.
This type of port is usually built near industrial zones to ease imports and exports. The objective is to better serve investors.
The ultimate goal of the inland ports is to ease pressure on the country’s road network in a bid to reduce operational and maintenance costs. Moreover, the objective is to boost reliance on railway cargo transport across the country.
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