Infrastructure is set to receive substantial state funding in the upcoming fiscal year. The government is planning to direct a significant portion of its EGP 3.5 tn in total investments toward infrastructure-related sectors, including transportation, electricity, water and sanitation, oil and gas, and communications under its Economic and Social Development Plan for FY 2025-2026 (pdf).

The big picture: The government is targeting total investments of EGP 3.5 tn in FY 2025-26, up from an estimated EGP 2.6 tn in the current fiscal year. Public investments will account for EGP 1.2 tn, while the private sector is expected to contribute EGP 1.9 tn, representing c. 63% of the total and reflecting a shift toward greater private sector participation.

The government is dividing the investments across three main sectoral groups. Key service sectors like transport, storage, wholesale and retail trade, ins. and finance services, and tourism are allocated the largest share at 42%. Primary economic sectors such as agriculture, fishing, mining, and quarrying, as well as secondary sectors such as manufacturing, energy, and construction are expected to account for 34% of total fixed investments. Meanwhile, sectors tied to human and social development — such as education and healthcare — are expected to receive the remaining 24%.

Water and sanitation projects are a priority: Some EGP 77 bn worth of public investment has been allocated to complete drinking water and sanitation projects, including those that fall under the government’s Decent Life initiative. These investments will be split between EGP 27.8 bn for water projects and EGP 49.2 bn for the sanitation sector. During the fiscal year, the government aims to set up 56 drinking water stations with a capacity of 1 mn cubic meters per day, 17 desalination facilities with a capacity of 455k cubic meters per day, 135 sanitation projects, and 33 water treatment plants.

Lower spending on oil and gas: The government has allocated EGP 25.8 bn to the oil and gas sector — a far cry from the EGP 136 bn during the present fiscal year. The funds will be used to build petroleum pipelines, renovate and replace strategic fuel storage facilities, upgrade the national gas grid, and continue the construction of aircraft refueling stations.

Egypt’s fastest-growing sector is seeing major cuts: Public investment allocated to the ICT sector has been slashed to EGP 13 bn from EGP 85 bn in the currentfiscalyear. The funds will go toward telecom infrastructure, digital transformation, digital skills and capacity-building initiatives, IT industry localization, improving cybersecurity, and growing exports of outsourcing and consulting services. The government also plans to push ahead with software development, e-signature applications, and complete the first two phases of the new capital’s Knowledge City.

The plan aims to raise digital exports to USD 8.5 bn, with outsourcing services accounting for USD 6 bn of that figure.

REMEMBER- The government wants to see digital exports bring in USD 9 bn into the economy annually as of 2026 and then up to USD 13 bn by 2030.

Electricity and renewables will receive EGP 100 bn in public investment to help power megaprojects like the high-speed electric train, the Cairo monorail, and land reclamation. The funds will also support the completion of a 20 MW solar plant in Hurghada and prepare six sites for renewable energy projects across the Nile, Gabal El Zeit, Nag Hammadi, Ras Shukeir, South Hurghada, and Benban.

ICYMI- The government wants to increase renewables’ contribution to the energy mix to 18.6%by FY2026-27, 42% by 2030, and 65% by 2040.

On the logistics front: The state aims to complete 32 inter-governorate roads and 11 bridge projects in the next fiscal year. It also aims to implement 10 projects to streamline the flow of goods at land and dry ports and launch several initiatives at maritime ports, including kicking off construction at the Safaga Port.

Industry localization efforts continue: The government has allocated EGP 27 bn — primarily to be executed by public-sector companies — to support manufacturing. The state aims to focus on completing industrial zones, which includes introducing utilities at Robbiki Leather City and upgrading the infrastructure at zones in Sohag and Qena. The plan also focuses on building export-oriented industries, developing human capital, and supporting green industry. Priority sectors include iron and steel, paper, pharmaceuticals, vaccines, pipes, boilers, and auto components and spare parts.

Your top infrastructure stories for the week:

  • Property developer Landmark for Real Estate Development (LMD) is in talks with the Egyptian government to develop a new USD 4 bn mixed-use project in Cairo. The development will be located in “one of Cairo’s newest urban areas” and could kick off construction before the end of 2025.
  • The Red Sea Ports Authority is mulling awarding the EGP 4 bn Taba Port development project to Suez Canal Authority’s subsidiary Suez Canal Ports Company. The port is slated to give local exports access to new markets at lower costs and ease the reliance on traditional land routes by opening up faster and more efficient access to Jordan and Saudi Arabia.
  • The country’s first green chemicals plant is officially under construction, after China’s Binhua Group — or Befar — broke ground on their USD 500 mn chlor-alkali production facility in the China-Egypt TEDA trade zone. The big-ticket project is split between a USD 300 mn first phase — to be completed within 18 months — and a USD 200 mn second phase.
Tags: