Cairo – Mubasher: The Egyptian government has pumped approximately EGP 200.7 billion worth of investment in the implementation of projects in the new cities being established across the country, while the private sector has invested nearly EGP 400 billion in these projects, according to the latest official data by the New Urban Communities Authority of Egypt.
The authority has allocated EGP 73.7 billion in the housing sector, EGP 17.1 billion in the services sector, EGP 107.7 billion in the utilities sector, and EGP 2.2 billion in the agriculture and performance development sector.
Growing population in Egypt encouraged the government to think of alternatives to absorb the continuous demand for residential units.
JLL Country Head- Egypt Ayman Sami told Mubasher on Sunday that “Egypt is developing 20 new cities to accommodate more than 30 million people over an area of 2.4 million square kilometres.”
In his comment on establishing new cities in Egypt, Ayman Sami further explained that: “The densities within the current cities are becoming less sustainable and it is affecting the quality of life, hence the growth towards the new cities is inevitable and will continue to grow as the population grows at the current rates; this will flow into the need for more housing with almost 1 million marriages per annum, more jobs to support the growing demand, more industrial, offices, and retail activity, etc.”
(JLL Country Head- Egypt Ayman Sami)
Recent official data shows that the number of housing units in new urban cities across the country totals 2.282 million; as 782,000 are executed by the authority, while the current total number of housing units implemented by the private sector reaches 1400,000.
Over and above the large local demand, there are further efforts from the government and private developers to attract foreign buyers to acquire residential units in Egypt, Ayman Sami added.
As for the labour force in Egypt and its contribution to the country’s gross domestic product (GDP), JLL’s country head- Egypt told Mubasher that according to the Central Agency for Public Mobilization and Statistics (CAPMAS), 13 % of the total labour force is engaged in the field of construction and building; and according to the Central Bank of Egypt (CBE), it is growing at a much faster pace than the GDP growth rate, hence it is a very important contributor to GDP and employment in Egypt.
The number of factories founded under the administration of the New Urban Communities Authority has reached 9,040 at an invested capital exceeding EGP 132.56 billion pounds; with an annual production of EGP 113.08 billion, the factories are estimated to develop 754,661 job opportunities with a salary amounting EGP 5.405 billion, according to the latest official data.
Factories under construction stand at approximately 5,850 with a capital reaching EGP 64.149 billion; these factories are forecast to produce EGP 98.071 billion each year and create 193,897 job opportunities of EGP 2.222 billion worth of income.
Ayman Sami believes that: “In the context of the regional developers and international retailer interest in moving closer to the tertiary cities, there is a very large interest in those new cities due to the limited availability of modern shopping centres/land for development within the existing cities; and in some areas the purchasing power is actually quite high.”
The retail sector and modern shopping centres industry in Egypt have been developing rapidly in the recent period, with the major shopping centres spots including Mall of Egypt, Mall of Arabia, and Galleria40 in the 6th of October City; Cairo Festival City Mall and Downtown Katameya in the 5th Settlement in New Cairo; Arkan Plaza in Sheikh Zayed City; Dandy Mega Mall and Designopolis on the Cairo-Alex Desert Road.
“The development of modern shopping centres away from the main cities will not only serve the consumers who have a thirst for the variety of brands which are currently only available in the major cities, but will also create direct jobs within those retail centres and indirect jobs for logistics, agricultural and industrial activity supporting and formalising trade all over the country,” JLL’s country head- Egypt told Mubasher.
Furthermore, Ayman Sami said that in addition to the above, the revival of the tourism sector is also another large contributor to employment and hotel development in Egypt.
Last week, Colliers International MENA told Mubasher that the new cities are also an opportunity to enhance the economic growth to attract FDI to the local economy, and encourage a certain economic pattern such as industrial cities, port cities, etc.
(Contributed by Ingy ElSafy)