Egypt wants people to invest in the southern coast of the Red Sea

The housing minister and a source from the finance ministry have stated that Egypt is making progress in its efforts to attract large-scale investments by developing the Ras Banas area of remote coastline on the Red Sea.

The Ras Banas region, a 30-kilometer (19 mile) peninsula in the far southern region of Egypt, is one of the few areas of the North African country’s littoral that has not been developed for tourism. It is situated across the Red Sea from Saudi Arabia.

In an effort to resolve a protracted economic crisis that has resulted in an increasing debt burden, record inflation, and abrupt currency devaluations over the past two years, Egypt has been actively pursuing large-scale investments.

The $24 billion sale of rights to develop the Ras El Hekma peninsula on Egypt’s Mediterranean coast to a UAE sovereign fund earlier this year has led to speculation about potential follow-up agreements involving Gulf investors.

Housing Minister Sherif el-Sherbiny was quoted by Egyptian media as stating on Saturday that a strategic and investment blueprint for Ras Banas was nearing completion. He intended to present the blueprint to potential investors in the near future.

A source from the finance ministry verified that Egypt was actively seeking investment in Ras Banas and suggested that Saudi Arabia could be a potential investor. The source also mentioned that there had been months of discussion regarding the conversion of Saudi deposits at the Egyptian central bank into direct investments.

In an effort to resolve a protracted economic crisis that has resulted in an increasing debt burden, record inflation, and abrupt currency devaluations over the past two years, Egypt has been actively pursuing large-scale investments.

Before Egypt signed the Ras El Hekma deal with Abu Dhabi’s ADQ and secured billions in financing from international lenders, a chronic foreign currency shortage was exacerbated by a loss of Suez Canal revenues as a result of attacks on Red Sea shipping by Yemen’s Houthi movement.

The conversion of $11 billion in dollar deposits at Egypt’s central bank was part of the $35 billion agreement with ADQ.

According to data from Egypt’s central bank, Saudi Arabia maintains $5.3 billion in medium- to long-term deposits. It is also believed that the $5 billion in short-term deposits that were deposited in 2022 have been carried over since that time.

Egypt’s cabinet announced on Monday that the Saudi Public Investment Fund would invest $5 billion in Egypt as a result of a meeting between the Egyptian prime minister and Saudi Crown Prince Mohammed bin salman.

The announcement resulted in a surge in the value of Egypt’s government bonds on Tuesday.