Trans­port Min­istry seeks co­op­er­a­tion from pri­vate sec­tor to de­velop rail­ways

Cairo Metro will in­crease its ticket prices in 2018 or 2019 af­ter it com­pletes the de­vel­op­ment process

The Daily News Egypt - - Front Page - By Nevine Kamel

Min­is­ter of Trans­porta­tion He­sham Arafat said his min­istry seeks to co­op­er­ate with the pri­vate sec­tor to de­velop rail­ways. “We wel­come the par­tic­i­pa­tion of the pri­vate sec­tor to ac­com­plish the task,” he said.

Dur­ing a sem­i­nar or­gan­ised by the Amer­i­can Cham­ber of Com­merce in Egypt, Arafat added that the Min­istry of Trans­porta­tion has al­ready re­ceived a num­ber of of­fers from in­vestors to de­velop the Abu Tartour Safaga Rail­way.

The min­is­ter said that a pro­to­col was signed with a pri­vate com­pany to trans­port con­tain­ers from the 6th of Oc­to­ber City to Alexan­dria, Dami­etta, and Ain Sokhna ports.

De­spite the re­cent rise in metro ticket prices, the num­ber of metro users in­creased by 10%, said Arafat. Hence, there is an ur­gent need to im­prove the metro’s ser­vices to ab­sorb the grow­ing num­ber of users.

The min­is­ter an­nounced that an­other in­crease in metro tick­ets will be ap­plied in 2018 or 2019 af­ter the end of the de­vel­op­ment process.

Arafat be­lieves Egypt’s lo­ca­tion can work in favour of the de­vel­op­ment of the na­tional econ­omy, not­ing that the trans­port sec­tor’s con­tri­bu­tion to the GDP reached only 3% in the fis­cal year (FY) of 2014 / 2015. There­fore, the min­istry seeks to de­velop in­te­grated road net­works na­tion­wide.

In this con­text, Arafat an­nounced plans to es­tab­lish new roads with 2,200km to link the en­tire coun­try, with in­vest­ments worth EGP 30bn un­til 2030.

He also an­nounced the min­istry’s in­ten­tion to de­velop 500km of ex­ist­ing roads with in­vest­ments of EGP 10bn, in ad­di­tion to 15 new cor­ri­dors above the Nile with in­vest­ments of EGP 12.5bn dur­ing the same pe­riod.

“The de­vel­op­ment of metro ser­vices be­came ur­gent to ab­sorb the ex­pected pres­sure on the fa­cil­ity due to the re­cent cut of en­ergy sub­si­dies,” Arafat said.

Since the 30 June Up­ris­ing, the Egyp­tian gov­ern­ment has cut the value of en­ergy sub­si­dies fre­quently, par­tic­u­larly gaso­line and diesel.

In re­gard with the river trans­port, the min­is­ter said he en­cour­ages the pri­vate sec­tor to con­trib­ute to es­tab­lish­ing a num­ber of Nile routes, such as Cairo-Alexan­dria, Cairo-Dami­etta, Cairo-Aswan, and Cairo-Talkha.

Arafat said that the min­istry in­tends to fi­nance the ex­pan­sion and de­vel­op­ment of road net­works and rail­ways through ob­tain­ing loans from in­ter­na­tional fi­nance in­sti­tu­tions such as the Euro­pean Bank for Re­con­struc­tion and De­vel­op­ment (EBRD), the World Bank, and the Kuwait De­vel­op­ment Fund. In ad­di­tion, the min­istry can is­sue bonds or through pri­vate eq­uity.

“The par­tic­i­pa­tion of the pri­vate sec­tor in fi­nanc­ing the road projects is nec­es­sary,” said the min­is­ter, point­ing out that the de­vel­op­ment of each kilo­me­ter of roads costs EGP 20m, while the con­struc­tion of each kilo­me­tre of rail­way costs $7.5m.


Min­is­ter of Trans­porta­tion He­sham Arafat

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