The state is earmarking EGP 8 bn to develop Damietta Port ahead of opening up the dock to international management tenders and a future public offering, a government official tells EnterpriseAM. A EGP 6 bn new grain and bulk commodities terminal and a EGP 2 bn 2.5 mn sqm multi-purpose terminal under the name Tahya Misr 2 will be built by the Suez Canal Authority’s Harbor and Great Projects Company, while the second phase of the logistics zone at the port will be built by the Holding Company for Roads, Bridges and Land Transport Projects, we were told.

Why it matters: By fronting the money for the two developments, the government is de-risking the projects for global port giants (like DP World or AD Ports) that are increasingly hesitant to take on greenfield construction risks in the current macro environment. This approach to building up state assets and cleaning up balance sheets before a sale or inviting the private sector to take on management to get a better price is illustrative of the state’s broader approach to divestment.

The development follows the port’s USD 600 mn Tahya Misr 1 terminal project, which demonstrated the state’s ability to attract foreign direct investment into the sector, Chamber of Transport and Logistics Secretary-General Amr El Samadony tells EnterpriseAM. The further two projects will continue to support the country’s efforts to attract global alliances and establish itself as a global logistics hub, he added.

What’s next? Once the development works are completed, international alliances will be invited to participate in a global tender for the management and operation of the newly developed terminals, the government official tells us.

Tags: