There’s a lot of manufacturing news today,with overseas trips by the SCZone and Trade Ministry lining up nine-figure sums of potential investment from China and Turkey. This is good news for the Madbouly government, which has been on an investment promotion kick using tools including golden licenses and more recent business reforms.

CHINESE INVESTMENTS-

Over USD 100 mn in Chinese textile investments could be coming to the SCZone: The Suez Canal Economic Zone (SCZone) and a number of Chinese companies have signed agreements to establish textile projects worth a combined USD 101.3 mn in investment in the West Qantara Industrial Zone, a cabinet statement said yesterday. The statement did not provide any details on the production capacities of the project or their implementation timelines.

SCZone chief Walid Gamal El Din is currently in China to drum-up investment: Walid Gamel El Din landed in Shanghai on Sunday to meet with Chinese companies within the textile industries and other sectors targeted for localization in the authority’s ports and regions. The SCZone signed initial agreements with a number of Chinese companies in May, during its China and Hong Kong roadshow.

Hengsheng to invest USD 70 mn in textile factory: The SCZone signed a usufruct contract with Hengsheng Dyeing Zhejiang Company to invest USD 70 mn building a dyeing, processing, and textile manufacturing project on a 200k sq m plot of land in the West Qantara Industrial Zone, which is expected to create some 1.5k new job opportunities.

More to come: Three letters of intent were also signed to establish textile projects, with contracts hopefully being signed in the upcoming months, the statement read.

#1- Fabrics producer Shanoxing Yuding Textile Company wants to invest USD 5 mn to open a factory — under the name Dinghang Egypt — on a 12.7k sq m plot in the West Qantara Industrial Zone. The factory will create 100 new jobs and the company plans to export 90% of the total production to the US and European market.

#2-Shengzhou Captain Industrial and Trading Company chair Wang Xiao Rong signed a letter indicating that the company wants to invest USD 5 mn in a plant manufacturing spandex, polyester and elastic yarns on a 12k sq m plot in the West Qantara Industrial Zone, creating some 500 new jobs.

#3- Australian China-based investment firm IndoChine Holdings could spend USD 21.3 mn developing a factory in the Qantara West Industrial Zone. The Hangzhou-based company plans to export 100% of the factory’s products to US and European markets.

The SCZone’s textile sector has seen a host of commitments this year: Agreements for some USD 45 mn worth of textile projects in China’s TEDA industrial zone in Ain Sokhna were signed in July, while the local unit of Shanghai-listed Chinese textile manufacturer Zhejiang Cady Industry announced in August that it would invest USD 60 mn to establish a factory in the TEDA zone, with the first phase set to start this year and wrap up before the end of 2024

ICYMI- China is looking to expand its presence in Egypt in a big way: Some 10-15 Chinese companies have shown interest in establishing a specialized industrial zone for chemicals with investments worth the equivalent of USD 7.5-12 bn in CNY over the next three to four years. The push comes as many manufacturers look to diversify their footprints by adopting a “China +1” posture.

CNY investments could accelerate that: Authorities could allow Chinese to make local investments in CNY, with media outlets reporting that there is an agreement between the General Authority for Freezones and Investment and the Central Bank of Egypt to increase the use of the currency in Egypt. Talks are ongoing for the China Development Bank to set up a branch in Egypt, a move that would enable Chinese companies to access CNY in Egypt to fund local investments.

TURKISH INVESTMENTS-

Trade delegation drums up Turkish investments: Trade Minister Ahmed Samir was in Turkey to meet with companies working in textiles, paper, real estate, and other industries and promote investment in Egypt, according to a Trade Ministry statement yesterday.

#1- Textile and real estate company Eroglu Holding wants to expand one of its existing textile factories in Damietta to bring annual production to 50 mn meters of fabric and yearly sales to USD 150 mn. The company also wants to set up a USD 300 mn polyester and nylon factory on 500k sq m in the Suez Canal with the aim of achieving USD 200 mn in annual sales. The company is also mulling over opening a mattress factory at a cost of USD 200 mn to both serve local demand and export to Africa.

#2-Hygiene and sanitary products company Hayat hopes to open three additional factories in the country. A USD 70 mn paper tissue factory is on the cards, as is a USD 35 million industrial detergents plant, and a diaper facility of an unspecified size. The company is also studying the possibility of opening a paper factory that uses our abundant date palms as the main raw material. The company has been operating here since 2012 and has invested USD 550 mn so far in its Egypt operations.

#3-Clothing giant LC Waikiki wants to open a factory in one of our freezones to take advantage of the incentives on offer. On the high street (and malls), the Turkish company wants to expand to 100 stores in five years, more than double the 38 it currently has. Its total investments here currently stand at USD 100 mn.

#4- Fellow clothing company T&C is looking to expand its total factory footprint here to 100k sq m. The company already employs 6.5k people

#5- And last but not least, for the sweet tooths out there, Turkish confectionery companyKervan is aiming to expand its current factory by over 50% to 50k sq m.

BACKGROUND- Amid warming diplomatic ties between Egypt and Turkey, Turkish banks and manufacturers have been expressing their interest in expanding into the local Egyptian market, and the two sides even reinstated the Egyptian-Turkish Business Council for the first time in 10 years in May.

IN OTHER MANUFACTURING NEWS-

Alstom to ink EUR 300 mn industrial complex contract next month: French rolling stock manufacturer Alstom will ink a EUR 300 mn contract with the Transport Ministry on the sidelines of the the Transmea Conference, taking place from 5-8 November, Amwal Al Ghad reported, citing sources it says have knowledge of the matter. Alstom will use the investment over the next three years to establish two factories in Borg El Arab to produce electrical systems along with metro and monorail rolling stock. Over the summer, the cabinet approved in principle Alstom’s plans.

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