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Bridging the divide
TRANSPORT
1,454
vessels passed through the
Suez Canal in 2009
Some countries are seeking international
investors to back billions of dollars worth
of projects, such as the £E4.4bn ($800m)
railway from Cairo to Roubiky and 10th of
Ramadan cities in Egypt, and the planned
Jordanian rail network.
In Saudi Arabia, the government
will finance key parts of the kingdom’s
infrastructure itself after banks refused
to lend money to two multi-billion-dollar
projects: the $7bn high-speed railway
between Mecca and Medina, and the $7bn
Saudi Land bridge rail link connecting the
Gulf and Red Sea coasts.
In other cases, it is unclear whether the
state or the private sector will finance badly
needed developments. In Iraq, for example,
the $1bn privatization of the deep-sea port at
Umm Qasr – the country’s marine gateway
– has been on hold since September,
when Transport Minister Amer Abduljabbar
blocked the appointment of an international
consultant, the US’ Cornell Group, to
oversee the redevelopment of the site.
Suez Canal
Iran’s ability to push ahead with its
major transport projects is just as doubtful,
although the financing difficulties in the
Islamic Republic are further complicated
by the US-led international sanctions and
domestic economic problems.
High-speed lines from Tehran to Esfahan
and Mashhad have been on hold since
January 2008 because the government
cannot afford to pay for them directly. The
$18.5bn project to add 12 lines to the
Tehran Metro before 2030 has also been
stalled for two years.
However, a 1,100-kilometre-long rail line
running the length of the country’s eastern
border, from Mashhad in the northeast to the
port of Chabahar on the Arabian Sea, seems
likely to go ahead at a cost of at least $1bn,
if only because Chinese rail firms are likely
to provide the finance.
Many other international companies
continue to shy away from Iraq and Iran,
however, due to the inherent difficulties
in working in either country and the
opportunities available elsewhere.
Egypt has made significant steps to
open itself to foreign investment since the
government of Prime Minister Ahmed Nazif
came to power in 2004, although further
moves could yet be needed given the
extent of Cairo’s plans. Investment Minister
Mahmoud Mohieldin has drawn up a list
of road, rail and port projects worth up to
£E130bn that the government hopes to
award by the end of June 2011.
The port projects alone will require
£E15bn in investment. They include plans
for a £E5.2bn bulk terminal at Adabiya Port,
to the south of the Suez Canal, which will
import iron ore and export finished products.
At the Mediterranean end of the canal, the
Transport Ministry plans to build a container
terminal and a ship refuelling station, and to
develop the port’s logistics capabilities.
Other schemes cover less strategically
important sites. For example, the Investment
Ministry wants to build a 415km-long
road linking the cities of Asyut, Qena and
Sohag in Upper Egypt to the Red Sea
coast, at a cost of £E1.6bn. In common
with other countries in the region, Egypt is
also expanding its rail system. Orascom
Construction Industries, the country’s largest
construction firm, is currently working on an
upgrade to the Cairo Metro, which is due to
have six new lines by 2022.
The port projects alone
will require £E15bn in
investment. They include
plans for a £E5.2bn bulk
terminal at Adabiya Port,
to the south of the Suez
Canal
Tanger Med Port
May 2010 Link 23